A08468 Summary:

BILL NOA08468A
 
SAME ASSAME AS S08485
 
SPONSORRosenthal L
 
COSPNSRSeawright, Gottfried, Epstein, Gonzalez-Rojas, Simon, Kim, Fernandez, Burgos, Mamdani, Forrest, Gallagher, Montesano
 
MLTSPNSR
 
Amd §§1612 & 1617-a, rpld §1612 sub b ¶3, Tax L; rpld §1355 sub 1 ¶(b), RWB L
 
Relates to the investment of funds wagered on video lottery gaming for certain horse races.
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A08468 Actions:

BILL NOA08468A
 
11/17/2021referred to ways and means
01/05/2022referred to ways and means
03/04/2022amend (t) and recommit to ways and means
03/04/2022print number 8468a
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A08468 Committee Votes:

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A08468 Floor Votes:

There are no votes for this bill in this legislative session.
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A08468 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A8468A
 
SPONSOR: Rosenthal L
  TITLE OF BILL: An act to amend the tax law, in relation to the investment of funds wagered on video lottery gaming for certain horse races; to repeal certain provisions of the tax law relating thereto; and to repeal para- graph b of subdivision 1 of section 1355 of the racing, pari-mutuel wagering and breeding law relating thereto   PURPOSE: This legislation will end racing subsidies in New York State and invest the revenue generated from video lottery gaming facilities at racetracks to education and communities throughout the state.   SUMMARY OF SPECIFIC PROVISIONS: Section one amends subdivision f of section 1612 of the tax law. Section two amends paragraph 1-b of subdivision b of section 1612 of the tax law. Section three amends subdivision f-1 of section 1612 of the tax law. Section four amends paragraph 2 of subdivision b of section 1612 of the tax law. Section five repeals paragraph 3 of subdivision b of section 1612 of the tax law. Section six amends subdivision h of section 1612 of the tax law. Section seven amends paragraph 5 of subdivision a of section 1617-a of the tax law. Section eight repeals paragraph b of subdivision 1 of section 1355 of the racing, pari-mutuel wagering and breeding law. Section nine contains the severability clause. Section ten establishes the effective date.   JUSTIFICATION: Attendance at horse racing venues in New York State has sharply declined over the years. While the summer racing season at Saratoga remains popu- lar, stands at Yonkers Raceway, Aqueduct Racetrack and others are prac- tically empty. The decline in the popularity of horse racing in recent years has been partly attributed to the public's increasing disapproval of cruelty within the industry, evidenced by doping scandals and the high numbers of injuries and deaths. Despite horse racing's diminishing attraction, New York State continues to provide millions of dollars in subsidies each year to prop up the industry. Other states, including Kentucky, California, Illinois, and Texas do not provide state subsidies to their racing industry. Each year, approximately $250 million in revenue generated by the state's casino industry is diverted to support the horse racing indus- try. This revenue would be better spent investing in New York State's education system as well as economic development in communities where racing occurs. A 2021 Marist poll found that just 9% of New Yorkers support state subsidies of horse racing, and as the horse racing indus- try continues to decline in popularity, it is time to reinvest these subsidies in areas that will truly help New Yorkers.   LEGISLATIVE HISTORY: New bill.   FISCAL IMPLICATIONS: To be determined.   EFFECTIVE DATE: This act shall take effect immediately.
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A08468 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         8468--A
 
                               2021-2022 Regular Sessions
 
                   IN ASSEMBLY
 
                                    November 17, 2021
                                       ___________
 
        Introduced  by  M.  of  A.  L. ROSENTHAL, SEAWRIGHT, GOTTFRIED, EPSTEIN,
          GONZALEZ-ROJAS,  SIMON,  KIM,  FERNANDEZ,  BURGOS  --  read  once  and
          referred  to  the  Committee  on  Ways and Means -- recommitted to the
          Committee on Ways and Means in accordance with Assembly Rule 3, sec. 2
          -- committee discharged, bill amended, ordered  reprinted  as  amended
          and recommitted to said committee
 
        AN  ACT  to  amend  the  tax law, in relation to the investment of funds
          wagered on video lottery gaming for certain  horse  races;  to  repeal
          certain  provisions  of  the  tax  law relating thereto; and to repeal
          paragraph b of subdivision 1 of section 1355 of the racing, pari-mutu-
          el wagering and breeding law relating thereto
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section 1. Subdivision f of section 1612 of the tax law, as amended by
     2  chapter  174 of the laws of 2013, paragraph 1 as amended by section 2 of
     3  part OO of chapter 59 of the laws of 2014 and paragraph 3 as amended  by
     4  section  2  of  part  V of chapter 59 of the laws of 2020, is amended to
     5  read as follows:
     6    f. As consideration for the operation  of  the  video  lottery  gaming
     7  facility  at Aqueduct racetrack, the division shall cause the investment
     8  in the education system of the state of New York and the racing industry
     9  of the following percentages of the vendor fee to be deposited or  paid,
    10  as follows:
    11    1.  Six  and  one-half  percent  of  the total wagered after payout of
    12  prizes for the first year of operation of video lottery gaming at  Aque-
    13  duct  racetrack,  seven  percent  of  the  total wagered after payout of
    14  prizes for the second year of operation, and seven and one-half  percent
    15  of the total wagered after payout of prizes for the third year of opera-
    16  tion  and  thereafter,  for the purpose of [enhancing purses at Aqueduct
    17  racetrack, Belmont Park racetrack and Saratoga race course. One  percent
    18  of  the gross purse enhancement amount, as required by this subdivision,

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13560-05-2

        A. 8468--A                          2

     1  shall be paid to the gaming commission to be used exclusively to promote
     2  and ensure equine health and safety in New York.  Any  portion  of  such
     3  funding  to  the  gaming commission unused during a fiscal year shall be
     4  returned  on  a pro rata basis in accordance with the amounts originally
     5  contributed and shall be used for the purpose  of  enhancing  purses  at
     6  such  tracks]  funding  the  education  system of the state of New York,
     7  shall be deposited in the state  lottery  fund  for  additional  lottery
     8  grants  to eligible school districts, including schools serving students
     9  with disabilities and schools with preschool special education programs.
    10  [One and one-half percent of the  gross  purse  enhancement  amount,  as
    11  required  by  this  subdivision, shall be paid to an account established
    12  pursuant to section two hundred twenty-one-a of the racing,  pari-mutuel
    13  wagering  and  breeding  law  to  be  used exclusively to provide health
    14  insurance for jockeys.]
    15    2. [One] Eight and one-half percent of the total wagered after  payout
    16  of  prizes  [for  the first year of operation of video lottery gaming at
    17  Aqueduct racetrack, one and one-quarter percent  of  the  total  wagered
    18  after  payout  of  prizes  for the second year of operation, and one and
    19  one-half percent of the total wagered after payout  of  prizes  for  the
    20  third year of operation and thereafter, for an appropriate breeding fund
    21  for  the  manner of racing conducted at Aqueduct racetrack, Belmont Park
    22  racetrack and Saratoga race course] shall  be  deposited  in  the  state
    23  lottery fund for additional lottery grants to eligible school districts,
    24  including  schools  serving  students with disabilities and schools with
    25  preschool special education programs.
    26    3. [Four percent of the total revenue wagered after payout  of  prizes
    27  to  be  deposited  into  an account of the franchised corporation estab-
    28  lished pursuant to section two hundred six of  the  racing,  pari-mutuel
    29  wagering  and  breeding law to be used for capital expenditures in main-
    30  taining and upgrading Aqueduct racetrack,  Belmont  Park  racetrack  and
    31  Saratoga  race  course.  Capital  expenditures  may  include funding the
    32  construction of and initially equipping a state-based equine drug  test-
    33  ing  and research laboratory to be used pursuant to subdivision seven of
    34  section nine hundred two of the racing, pari-mutuel wagering and  breed-
    35  ing law.
    36    4.  Three percent of the total revenue wagered after payout for prizes
    37  to be deposited into an account of  the  franchised  corporation  estab-
    38  lished  pursuant  to  section two hundred six of the racing, pari-mutuel
    39  wagering and breeding law to be used  for  general  thoroughbred  racing
    40  operations  at  Aqueduct  racetrack, Belmont Park racetrack and Saratoga
    41  race course.
    42    5.] Paragraphs one[,] and two[, three and four]  of  this  subdivision
    43  shall   be   known  collectively  as  the  "[racing]  education  support
    44  payments".
    45    § 2. Paragraph 1-b of subdivision b of section 1612 of the tax law, as
    46  added by section 2 of part EE of chapter 59 of  the  laws  of  2019,  is
    47  amended to read as follows:
    48    1-b.  Notwithstanding  any provision of law to the contrary, free play
    49  allowance credits authorized by the division pursuant to  subdivision  i
    50  of  section  sixteen  hundred  seventeen-a  of this article shall not be
    51  included in the calculation of the total amount wagered on video lottery
    52  games, the total amount wagered after payout of prizes, the vendor  fees
    53  payable  to the operators of video lottery gaming facilities, fees paya-
    54  ble to the division's video lottery gaming equipment  contractors,  [or]
    55  racing support payments, or education support payments.

        A. 8468--A                          3
 
     1    §  3.  Subdivision  f-1  of section 1612 of the tax law, as amended by
     2  chapter 175 of the laws of 2013, is amended to read as follows:
     3    f-1.  As  consideration for operation of video lottery gaming facility
     4  located in the county of Nassau or Suffolk and operated by a corporation
     5  established pursuant to section five hundred two of the racing, pari-mu-
     6  tuel wagering and breeding law, the division shall cause the [investment
     7  in the racing industry of the] following [percentages] percentage of the
     8  vendor fee to be deposited or paid as follows:
     9    [1. Two and three tenths] Five percent  of  the  total  wagered  after
    10  payout  of prizes [for the purpose of enhancing purses at Aqueduct race-
    11  track, Belmont Park racetrack and Saratoga race course, provided, howev-
    12  er, that any amount that is in excess of the amount necessary  to  main-
    13  tain  purse  support  from  video  lottery gaming at Aqueduct racetrack,
    14  Belmont Park racetrack and Saratoga race course at the same level  real-
    15  ized  in  two  thousand  thirteen,  to be adjusted by the consumer price
    16  index for all urban consumers,  as  published  annually  by  the  United
    17  States department of labor, bureau of labor statistics, shall instead be
    18  returned to the commission] shall be deposited in the state lottery fund
    19  for  additional  lottery  grants to eligible school districts, including
    20  schools serving students with disabilities and  schools  with  preschool
    21  special education programs.
    22    [2.  five  tenths  percent of the total wagered after payout of prizes
    23  for the appropriate breeding fund for the manner of racing  at  Aqueduct
    24  racetrack,  Belmont  Park  racetrack and Saratoga race course, provided,
    25  however, that any amount that is in excess of the  amount  necessary  to
    26  maintain payments from video lottery gaming at Aqueduct racetrack at the
    27  same  level  realized  in  two  thousand thirteen, to be adjusted by the
    28  consumer price index for all urban consumers, as published  annually  by
    29  the United States department of labor, bureau of labor statistics, shall
    30  instead be returned to the commission.
    31    3.  one  and  three  tenths percent of the total revenue wagered after
    32  payout of prizes to be deposited  into  an  account  of  the  franchised
    33  corporation  established  pursuant  to  section  two  hundred six of the
    34  racing, pari-mutuel wagering and breeding law to  be  used  for  capital
    35  expenditures  in  maintaining  and upgrading Aqueduct racetrack, Belmont
    36  Park racetrack and Saratoga race course,  provided,  however,  that  any
    37  amount  that  is  in excess of the amount necessary to maintain payments
    38  for capital expenditures from video lottery gaming at Aqueduct racetrack
    39  at the same level realized in two thousand thirteen, to be  adjusted  by
    40  the  consumer price index for all urban consumers, as published annually
    41  by the United States department of labor, bureau  of  labor  statistics,
    42  shall instead be returned to the commission.
    43    4.  Nine  tenths percent of the total revenue wagered after payout for
    44  prizes to be deposited into an account  of  the  franchised  corporation
    45  established  pursuant to section two hundred six of the racing, pari-mu-
    46  tuel wagering and breeding law  to  be  used  for  general  thoroughbred
    47  racing  operations  at  Aqueduct  racetrack,  Belmont Park racetrack and
    48  Saratoga race course, provided, however, that  any  amount  that  is  in
    49  excess  of  the  amount  necessary  to  maintain  payments  for  general
    50  thoroughbred racing operations from video  lottery  gaming  at  Aqueduct
    51  racetrack  at  the  same  level realized in two thousand thirteen, to be
    52  adjusted by the  consumer  price  index  for  all  urban  consumers,  as
    53  published  annually  by the United States department of labor, bureau of
    54  labor statistics, shall instead be returned to the commission.]

        A. 8468--A                          4
 
     1    § 4. The opening paragraph of paragraph 2 of subdivision b of  section
     2  1612  of the tax law, as amended by section 2 of part S of chapter 39 of
     3  the laws of 2019, is amended to read as follows:
     4    As consideration for the operation of a video lottery gaming facility,
     5  the  division,  shall  cause  the investment [in the racing industry] in
     6  those counties that host video lottery gaming facilities, of  a  portion
     7  of the vendor fee received pursuant to paragraph one of this subdivision
     8  in  the  manner  set  forth in this subdivision.   With the exception of
     9  Aqueduct racetrack, a video lottery gaming facility authorized  pursuant
    10  to  paragraph  five  of  subdivision a of section sixteen hundred seven-
    11  teen-a of this article or a facility in the county of Nassau or  Suffolk
    12  operated  by  a corporation established pursuant to section five hundred
    13  two of the racing, pari-mutuel wagering  and  breeding  law,  each  such
    14  track  shall dedicate a portion of its vendor fees, received pursuant to
    15  clause (A), (B), (B-1), (B-2), (C), or (D) of subparagraph (ii) of para-
    16  graph one of this subdivision, for the purpose of [enhancing  purses  at
    17  such  track]  funding  economic development, job creation, and workforce
    18  protections in the counties that host video lottery  gaming  facilities,
    19  in  an  amount  equal  to  eight and three-quarters percent of the total
    20  revenue wagered at the vendor track  after  pay  out  for  prizes.  [One
    21  percent  of  the  gross  purse  enhancement  amount, as required by this
    22  subdivision, shall be paid to the gaming commission to  be  used  exclu-
    23  sively  to  promote and ensure equine health and safety in New York. Any
    24  portion of such funding to the gaming commission unused during a  fiscal
    25  year  shall  be  returned to the video lottery gaming operators on a pro
    26  rata basis in accordance with the amounts originally contributed by each
    27  operator and shall be used for the purpose of enhancing purses  at  such
    28  track]  Such  funds  shall  be credited to the host county in which each
    29  vendor track resides. Such funds shall be utilized by such counties  for
    30  the  purposes  of  economic  development,  job  creation,  and workforce
    31  protections. If a vendor track ceases racing operations, such vendor fee
    32  shall continue to be paid.
    33    [One and one-half percent of the gross purse enhancement amount  at  a
    34  thoroughbred track, as required by this subdivision, shall be paid to an
    35  account  established pursuant to section two hundred twenty-one-a of the
    36  racing, pari-mutuel wagering and breeding law to be used exclusively  to
    37  provide  health  insurance for jockeys.] In addition, with the exception
    38  of Aqueduct racetrack, a video lottery gaming facility authorized pursu-
    39  ant to paragraph five of subdivision a of section sixteen hundred seven-
    40  teen-a of this article or a facility in the county of Nassau or  Suffolk
    41  operated  by  a corporation established pursuant to section five hundred
    42  two of the racing, pari-mutuel wagering and breeding law, one  and  one-
    43  quarter  percent  of total revenue wagered at the vendor track after pay
    44  out for prizes, received pursuant to clause (A), (B), (B-1), (B-2), (C),
    45  or (D) of subparagraph (ii) of paragraph one of this subdivision,  shall
    46  be  distributed  [to  the  appropriate  breeding  fund for the manner of
    47  racing conducted by such track] for funding  economic  development,  job
    48  creation,  and  workforce  protections  in  the counties that host video
    49  lottery gaming facilities.
    50    § 5. Paragraph 3 of subdivision b of section 1612 of the  tax  law  is
    51  REPEALED.
    52    §  6.  Subdivision  h  of  section  1612 of the tax law, as amended by
    53  section 3 of part S of chapter 39 of the laws of  2019,  is  amended  to
    54  read as follows:
    55    h. As consideration for the operation of a video lottery gaming facil-
    56  ity located in Orange county, the division shall cause the investment in

        A. 8468--A                          5
 
     1  the  [racing  industry] education system of the state of New York at the
     2  following amount from the vendor fee to be paid as follows:
     3    [As  amount  to  the  horsemen  for  purses at a licensed racetrack in
     4  Sullivan county in an] An  amount  equal  to  eight  and  three-quarters
     5  percent of the total revenue wagered at the video lottery gaming facili-
     6  ty,  after  pay out for prizes to be deposited in the state lottery fund
     7  for additional lottery grants to eligible  school  districts,  including
     8  schools  serving  students  with disabilities and schools with preschool
     9  special education programs. [The facility located in Orange  county,  as
    10  defined  in  paragraph  five of subdivision a of section sixteen hundred
    11  seventeen-a of this article shall pay to  the  horsemen  at  a  licensed
    12  racetrack  at  Yonkers  racetrack  an amount to maintain purses for such
    13  horsemen at the same dollar levels realized in two thousand eighteen, to
    14  be adjusted by the consumer price index  for  all  urban  consumers,  as
    15  published  annually  by  the United States department of labor bureau of
    16  labor statistics.] In addition, one and  one-quarter  percent  of  total
    17  revenue  wagered  at the video lottery gaming facility after pay out for
    18  prizes, received pursuant to clause (B) of subparagraph  (ii)  of  para-
    19  graph  one of subdivision b of this section, shall be distributed to the
    20  [appropriate breeding] state lottery fund  for  [the  manner  of  racing
    21  conducted  by  such  track] additional lottery grants to eligible school
    22  districts, including schools  serving  students  with  disabilities  and
    23  schools  with  preschool  special education programs. In no circumstance
    24  shall net proceeds of the lottery, including  the  proceeds  from  video
    25  lottery  gaming,  be used for the payment of non-lottery expenses of the
    26  gaming commission, administrative or otherwise.
    27    § 7. Paragraph 5 of subdivision a of section 1617-a of the tax law, as
    28  added by  section 4 of part S of chapter 39 of  the  laws  of  2019,  is
    29  amended to read as follows:
    30    (5) At a facility located in Orange county to be operated by the enti-
    31  ty  otherwise  licensed  to  operate  video lottery gaming at Monticello
    32  racetrack, provided that: (i) such licensed entity is no longer  operat-
    33  ing  video  lottery  gaming  at  Monticello racetrack [and provided that
    34  Monticello racetrack is conducting racing operations]; (ii) such facili-
    35  ty in Orange county is not sited within a  thirty  mile  radius  of  the
    36  video  lottery  gaming  facility  at  Yonkers  racetrack;  and (iii) the
    37  licensed entity, its subsidiaries and affiliates, including  the  entity
    38  licensed to operate a commercial gaming facility in Sullivan county, and
    39  the entity licensed to operate video lottery gaming at Yonkers racetrack
    40  enter  into a mitigation agreement, to be approved by the gaming commis-
    41  sion, which shall include, but not be limited to,  terms  that  require:
    42  (A)  the  operator  of  the  facility in Orange county to make an annual
    43  payment to the entity  licensed  to  operate  video  lottery  gaming  or
    44  commercial  gaming  at Yonkers racetrack to account for the effects that
    45  siting such facility in Orange county would likely  have  on  the  gross
    46  gaming  revenue  of the entity licensed to operate at Yonkers racetrack;
    47  (B) employment levels at the affected  facilities;  and  (C)  that  upon
    48  expiration  or  termination  of  the agreement, the authority to operate
    49  video lottery gaming in Orange county shall cease.  Notwithstanding  any
    50  other  provision of this subdivision, at no time shall an entity operat-
    51  ing video lottery gaming in Orange county be permitted to apply  for  or
    52  receive  a license to operate a commercial gaming facility in that coun-
    53  ty.
    54    § 8. Paragraph (b) of subdivision 1 of section  1355  of  the  racing,
    55  pari-mutuel wagering and breeding law is REPEALED.

        A. 8468--A                          6
 
     1    §  9. Severability.   If any provision or term of this act is, for any
     2  reason, declared unconstitutional  or  invalid  or  ineffective  by  any
     3  competent  jurisdiction,  such decision shall not affect the validity of
     4  the effectiveness of the remaining portions of  this  act  or  any  part
     5  thereof.
     6    § 10. This act shall take effect immediately.
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