COMMITTEE SUBSTITUTE
FOR
COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 559
(By Senators Plymale, Bowman, Edgell, Unger,
Stollings, Foster, Jenkins and Hunter)
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[Originating in the Committee on Finance;
reported February 25, 2008.]
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A BILL to amend and reenact §29-22A-10 and §29-22A-10b of the Code
of West Virginia, 1931, as amended, all relating to the net
terminal income allocated to the Development Office Promotion
Fund and the Cultural Facilities and Capitol Resources
Matching Grant Program Fund.
Be it enacted by the Legislature of West Virginia:
That §29-22A-10 and §29-22A-10b of the Code of West Virginia,
1931, as amended, be amended and reenacted, all to read as follows:
ARTICLE 22A. RACETRACK VIDEO LOTTERY.
§29-22A-10. Accounting and reporting; commission to provide
communications protocol data; distribution of net
terminal income; remittance through electronic
transfer of funds; establishment of accounts and nonpayment penalties; commission control of
accounting for net terminal income; settlement of
accounts; manual reporting and payment may be
required; request for reports; examination of
accounts and records.
(a) The commission shall provide to manufacturers, or
applicants applying for a manufacturer's permit, the protocol
documentation data necessary to enable the respective
manufacturer's video lottery terminals to communicate with the
commission's central computer for transmitting auditing program
information and for activation and disabling of video lottery
terminals.
(b) The gross terminal income of a licensed racetrack shall be
remitted to the commission through the electronic transfer of
funds. Licensed racetracks shall furnish to the commission all
information and bank authorizations required to facilitate the
timely transfer of moneys to the commission. Licensed racetracks
must provide the commission thirty days' advance notice of any
proposed account changes in order to assure the uninterrupted
electronic transfer of funds. From the gross terminal income
remitted by the licensee to the commission, the commission shall
deduct an amount sufficient to reimburse the commission for its
actual costs and expenses incurred in administering racetrack video
lottery at the licensed racetrack and the resulting amount after the deduction is the net terminal income. The amount deducted for
administrative costs and expenses of the commission may not exceed
four percent of gross terminal income:
Provided, That any amounts
deducted by the commission for its actual costs and expenses that
exceeds its actual costs and expenses shall be deposited into the
State Lottery Fund. For the fiscal years ending the thirtieth day
of June, two thousand six, two thousand seven, two thousand eight,
two thousand nine, two thousand ten and two thousand eleven, the
term "actual costs and expenses" shall include transfers of no more
than twenty million dollars in any year to the Revenue Center
Construction Fund created by subsection (l), section eighteen,
article twenty-two of this chapter for the purpose of constructing
a state office building. For all fiscal years beginning on or
after the first day of July, two thousand one, the commission shall
not receive an amount of gross terminal income in excess of the
amount of gross terminal income received during the fiscal year
ending on the thirtieth day of June, two thousand one, but four
percent of any amount of gross terminal income received in excess
of the amount of gross terminal income received during the fiscal
year ending on the thirtieth day of June, two thousand one, shall
be deposited into the fund established in section eighteen-a,
article twenty-two of this chapter.
(c) Net terminal income shall be divided as set out in this
subsection. For all fiscal years beginning on or after the first day of July, two thousand one, any amount of net terminal income
received in excess of the amount of net terminal income received
during the fiscal year ending on the thirtieth day of June, two
thousand one, shall be divided as set out in section ten-b of this
article. The licensed racetrack's share is in lieu of all lottery
agent commissions and is considered to cover all costs and expenses
required to be expended by the licensed racetrack in connection
with video lottery operations. The division shall be made as
follows:
(1) The commission shall receive thirty percent of net
terminal income, which shall be paid into the State Lottery Fund as
provided in section ten-a of this article;
(2) Until the first day of July, two thousand five, fourteen
percent of net terminal income at a licensed racetrack shall be
deposited in the special fund established by the licensee and used
for payment of regular purses in addition to other amounts provided
for in article twenty-three, chapter nineteen of this code on and
after the first day of July, two thousand five, the rate shall be
seven percent of net terminal income;
(3) The county where the video lottery terminals are located
shall receive two percent of the net terminal income:
Provided,
That:
(A) Beginning the first day of July, one thousand nine hundred
ninety-nine, and thereafter, any amount in excess of the two percent received during the fiscal year one thousand nine hundred
ninety-nine by a county in which a racetrack is located that has
participated in the West Virginia Thoroughbred Development Fund
since on or before the first day of January, one thousand nine
hundred ninety-nine, shall be divided as follows:
(i) The county shall receive fifty percent of the excess
amount; and
(ii) The municipalities of the county shall receive fifty
percent of the excess amount, said fifty percent to be divided
among the municipalities on a per capita basis as determined by the
most recent decennial United States census of population; and
(B) Beginning the first day of July, one thousand nine hundred
ninety-nine, and thereafter, any amount in excess of the two
percent received during the fiscal year one thousand nine hundred
ninety-nine by a county in which a racetrack other than a racetrack
described in paragraph (A) of this subdivision is located and where
the racetrack has been located in a municipality within the county
since on or before the first day of January, one thousand nine
hundred ninety-nine, shall be divided, if applicable, as follows:
(i) The county shall receive fifty percent of the excess
amount; and
(ii) The municipality shall receive fifty percent of the
excess amount; and
(C) This proviso shall not affect the amount to be received under this subdivision by any other county other than a county
described in paragraph (A) or (B) of this subdivision;
(4) One percent of net terminal income shall be paid for and
on behalf of all employees of the licensed racing association by
making a deposit into a special fund to be established by the
racing commission to be used for payment into the pension plan for
all employees of the licensed racing association;
(5) The West Virginia Thoroughbred Development Fund created
under section thirteen-b, article twenty-three, chapter nineteen of
this code and the West Virginia Greyhound Breeding Development Fund
created under section ten of said article shall receive an equal
share of a total of not less than one and one-half percent of the
net terminal income;
(6) The West Virginia Racing Commission shall receive one
percent of the net terminal income which shall be deposited and
used as provided in section thirteen-c, article twenty-three,
chapter nineteen of this code.
(7) A licensee shall receive forty-six and one-half percent of
net terminal income.
(8)(A) The Tourism Promotion Fund established in section
twelve, article two, chapter five-b of this code shall receive
three percent of the net terminal income:
Provided, That for the
fiscal year beginning the first day of July, two thousand three,
the tourism commission shall transfer from the Tourism Promotion Fund five million dollars of the three percent of the net terminal
income described in this section and section ten-b of this article
into the fund administered by the West Virginia Economic
Development Authority pursuant to section seven, article fifteen,
chapter thirty-one of this code, five million dollars into the
Capitol Renovation and Improvement Fund administered by the
Department of Administration pursuant to section six, article four,
chapter five-a of this code and five million dollars into the Tax
Reduction and Federal Funding Increased Compliance Fund; and
(B) Notwithstanding any provision of paragraph (A) of this
subdivision to the contrary, for each fiscal year beginning after
the thirtieth day of June, two thousand four, this three percent of
net terminal income and the three percent of net terminal income
described in paragraph (B), subdivision (8), subsection (a),
section ten-b of this article shall be distributed as provided in
this paragraph as follows:
(i) 1.375 percent of the total amount of net terminal income
described in this section and in section ten-b of this article
shall be deposited into the Tourism Promotion Fund created under
section twelve, article two, chapter five-b of this code;
(ii) 0.375 percent of the total amount of net terminal income
described in this section and in section ten-b of this article
shall be deposited
in equal amounts into the Development Office
Promotion Fund created under section three-b, article two, chapter five-b of this code
and the Cultural Facilities and Capitol
Resources Matching Grant Program Fund created under section three,
article one, chapter twenty-nine of this code;
(iii) 0.5 percent of the total amount of net terminal income
described in this section and in section ten-b of this article
shall be deposited into the Research Challenge Fund created under
section ten, article one-b, chapter eighteen-b of this code;
(iv) 0.6875 percent of the total amount of net terminal income
described in this section and in section ten-b of this article
shall be deposited into the capitol renovation and improvement fund
administered by the Department of Administration pursuant to
section six, article four, chapter five-a of this code; and
(v) 0.0625 percent of the total amount of net terminal income
described in this section and in section ten-b of this article
shall be deposited into the 2004 Capitol Complex Parking Garage
Fund administered by the Department of Administration pursuant to
section five-a, article four, chapter five-a of this code;
(9)(A) On and after the first day of July, two thousand five,
seven percent of net terminal income shall be deposited into the
Workers' Compensation Debt Reduction Fund created in section five,
article two-d, chapter twenty-three of this code:
Provided, That
in any fiscal year when the amount of money generated by this
subdivision totals eleven million dollars, all subsequent
distributions under this subdivision shall be deposited in the special fund established by the licensee and used for the payment
of regular purses in addition to the other amounts provided for in
article twenty-three, chapter nineteen of this code;
(B) The deposit of the seven percent of net terminal income
into the Worker's Compensation Debt Reduction Fund pursuant to this
subdivision shall expire and not be imposed with respect to these
funds and shall be deposited in the special fund established by the
licensee and used for payment of regular purses in addition to the
other amounts provided for in article twenty-three, chapter
nineteen of this code, on and after the first day of the month
following the month in which the Governor certifies to the
Legislature that: (i) The revenue bonds issued pursuant to article
two-d, chapter twenty-three of this code have been retired or
payment of the debt service provided for; and (ii) that an
independent certified actuary has determined that the unfunded
liability of the Old Fund, as defined in chapter twenty-three of
this code, has been paid or provided for in its entirety; and
(10) The remaining one percent of net terminal income shall be
deposited as follows:
(A) For the fiscal year beginning the first day of July, two
thousand three, the Veterans Memorial Program shall receive one
percent of the net terminal income until sufficient moneys have
been received to complete the veterans memorial on the grounds of
the State Capitol Complex in Charleston, West Virginia. The moneys shall be deposited in the State Treasury in the Division of Culture
and History Special Fund created under section three, article
one-i, chapter twenty-nine of this code:
Provided, That only after
sufficient moneys have been deposited in the fund to complete the
veterans memorial and to pay in full the annual bonded indebtedness
on the veterans memorial, not more than twenty thousand dollars of
the one percent of net terminal income provided for in this
subdivision shall be deposited into a special revenue fund in the
State Treasury to be known as the John F. "Jack" Bennett Fund. The
moneys in this fund shall be expended by the Division of Veterans'
Affairs to provide for the placement of markers for the graves of
veterans in perpetual cemeteries in this state. The division of
veterans affairs shall promulgate legislative rules pursuant to the
provisions of article three, chapter twenty-nine-a of this code
specifying the manner in which the funds are spent, determine the
ability of the surviving spouse to pay for the placement of the
marker and setting forth the standards to be used to determine the
priority in which the veterans' grave markers will be placed in the
event that there are not sufficient funds to complete the placement
of veterans grave markers in any one year, or at all. Upon payment
in full of the bonded indebtedness on the veterans memorial, one
hundred thousand dollars of the one percent of net terminal income
provided for in this subdivision shall be deposited in the special
fund in the Division of Culture and History created under section three, article one-i, chapter twenty-nine of this code and be
expended by the Division of Culture and History to establish a West
Virginia veterans memorial archives within the cultural center to
serve as a repository for the documents and records pertaining to
the veterans memorial, to restore and maintain the monuments and
memorial on the capitol grounds:
Provided, however, That five
hundred thousand dollars of the one percent of net terminal income
shall be deposited in the State Treasury in a special fund of the
Department of Administration, created under section five, article
four, chapter five-a of this code, to be used for construction and
maintenance of a parking garage on the State Capitol Complex; and
the remainder of the one percent of net terminal income shall be
deposited in equal amounts in the Capitol Dome and Improvements
Fund created under section two, article four, chapter five-a of
this code and cultural Facilities and Capitol Resources Matching
Grant Program Fund created under section three, article one of this
chapter.
(B) For each fiscal year beginning after the thirtieth day of
June, two thousand four:
(i) Five hundred thousand dollars of the one percent of net
terminal income shall be deposited in the State Treasury in a
special fund of the Department of Administration, created under
section five, article four, chapter five-a of this code, to be used
for construction and maintenance of a parking garage on the State Capitol Complex; and
(ii) The remainder of the one percent of net terminal income
and all of the one percent of net terminal income described in
paragraph (B), subdivision (9), subsection (a), section ten-b of
this article shall be distributed as follows: The net terminal
income shall be deposited in equal amounts into the Capitol Dome
and Improvements Fund created under section two, article four,
chapter five-a of this code and the Cultural Facilities and Capitol
Resources Matching Grant Program Fund created under section three,
article one, chapter twenty-nine of this code until a total of one
million five hundred thousand dollars is deposited into the
Cultural Facilities and Capitol Resources Matching Grant Program
Fund; thereafter, the remainder shall be deposited into the Capitol
Dome and Improvements Fund.
(d) Each licensed racetrack shall maintain in its account an
amount equal to or greater than the gross terminal income from its
operation of video lottery machines, to be electronically
transferred by the commission on dates established by the
commission. Upon a licensed racetrack's failure to maintain this
balance, the commission may disable all of a licensed racetrack's
video lottery terminals until full payment of all amounts due is
made. Interest shall accrue on any unpaid balance at a rate
consistent with the amount charged for state income tax delinquency
under chapter eleven of this code. The interest shall begin to accrue on the date payment is due to the commission.
(e) The commission's central control computer shall keep
accurate records of all income generated by each video lottery
terminal. The commission shall prepare and mail to the licensed
racetrack a statement reflecting the gross terminal income
generated by the licensee's video lottery terminals. Each licensed
racetrack shall report to the commission any discrepancies between
the commission's statement and each terminal's mechanical and
electronic meter readings. The licensed racetrack is solely
responsible for resolving income discrepancies between actual money
collected and the amount shown on the accounting meters or on the
commission's billing statement.
(f) Until an accounting discrepancy is resolved in favor of
the licensed racetrack, the commission may make no credit
adjustments. For any video lottery terminal reflecting a
discrepancy, the licensed racetrack shall submit to the commission
the maintenance log which includes current mechanical meter
readings and the audit ticket which contains electronic meter
readings generated by the terminal's software. If the meter
readings and the commission's records cannot be reconciled, final
disposition of the matter shall be determined by the commission.
Any accounting discrepancies which cannot be otherwise resolved
shall be resolved in favor of the commission.
(g) Licensed racetracks shall remit payment by mail if the electronic transfer of funds is not operational or the commission
notifies licensed racetracks that remittance by this method is
required. The licensed racetracks shall report an amount equal to
the total amount of cash inserted into each video lottery terminal
operated by a licensee, minus the total value of game credits which
are cleared from the video lottery terminal in exchange for winning
redemption tickets, and remit the amount as generated from its
terminals during the reporting period. The remittance shall be
sealed in a properly addressed and stamped envelope and deposited
in the United States mail no later than noon on the day when the
payment would otherwise be completed through electronic funds
transfer.
(h) Licensed racetracks may, upon request, receive additional
reports of play transactions for their respective video lottery
terminals and other marketing information not considered
confidential by the commission. The commission may charge a
reasonable fee for the cost of producing and mailing any report
other than the billing statements.
(i) The commission has the right to examine all accounts, bank
accounts, financial statements and records in a licensed
racetrack's possession, under its control or in which it has an
interest and the licensed racetrack shall authorize all third
parties in possession or in control of the accounts or records to
allow examination of any of those accounts or records by the commission.
§29-22A-10b. Distribution of excess net terminal income.
(a) For all years beginning on or after the first day of July,
two thousand one, any amount of net terminal income generated
annually by a licensed racetrack in excess of the amount of net
terminal income generated by that licensed racetrack during the
fiscal year ending on the thirtieth day of June, two thousand one,
shall be divided as follows:
(1) The commission shall receive forty-one percent of net
terminal income, which the commission shall deposit in the State
Excess Lottery Revenue Fund created in section eighteen-a, article
twenty-two of this chapter;
(2) Until the first day of July, two thousand five, eight
percent of net terminal income at a licensed racetrack shall be
deposited in the special fund established by the licensee and used
for payment of regular purses in addition to other amounts provided
in article twenty-three, chapter nineteen of this code; on and
after the first day of July, two thousand five, the rate shall be
four percent of net terminal income;
(3) The county where the video lottery terminals are located
shall receive two percent of the net terminal income:
Provided,
That:
(A) Any amount by which the total amount under this section
and subdivision (3), subsection (c), section ten of this article is in excess of the two percent received during fiscal year one
thousand nine hundred ninety-nine by a county in which a racetrack
is located that has participated in the West Virginia Thoroughbred
Development Fund since on or before the first day of January, one
thousand nine hundred ninety-nine, shall be divided as follows:
(i) The county shall receive fifty percent of the excess
amount; and
(ii) The municipalities of the county shall receive fifty
percent of the excess amount, the fifty percent to be divided among
the municipalities on a per capita basis as determined by the most
recent decennial United States census of population; and
(B) Any amount by which the total amount under this section
and subdivision (3), subsection (c), section ten of this article is
in excess of the two percent received during fiscal year one
thousand nine hundred ninety-nine by a county in which a racetrack
other than a racetrack described in paragraph (A) of this
subdivision is located and where the racetrack has been located in
a municipality within the county since on or before the first day
of January, one thousand nine hundred ninety-nine, shall be
divided, if applicable, as follows:
(i) The county shall receive fifty percent of the excess
amount; and
(ii) The municipality shall receive fifty percent of the
excess amount; and
(C) This proviso shall not affect the amount to be received
under this subdivision by any county other than a county described
in paragraph (A) or (B) of this subdivision;
(4) One half of one percent of net terminal income shall be
paid for and on behalf of all employees of the licensed racing
association by making a deposit into a special fund to be
established by the Racing Commission to be used for payment into
the pension plan for all employees of the licensed racing
association;
(5) The West Virginia Thoroughbred Development Fund created
under section thirteen-b, article twenty-three, chapter nineteen of
this code and the West Virginia Greyhound Breeding Development Fund
created under section ten of said article shall receive an equal
share of a total of not less than one and one-half percent of the
net terminal income.
(6) The West Virginia Racing Commission shall receive one
percent of the net terminal income which shall be deposited and
used as provided in section thirteen-c, article twenty-three,
chapter nineteen of this code;
(7) A licensee shall receive forty-two percent of net terminal
income;
(8)
The tourism promotion fund established in section twelve,
article two, chapter five-b of this code shall receive three
percent of the net terminal income: Provided, That for each fiscal year beginning after the thirtieth day of June, two thousand four,
this Three percent of net terminal income shall be distributed
pursuant to the provisions of
paragraph (B) subparagraph (ii),
subdivision (8), subsection (c) , section ten of this article;
(9)(A) On and after the first day of July, two thousand five,
four percent of net terminal income shall be deposited into the
Workers' Compensation Debt Reduction Fund created in section five,
article two-d, chapter twenty-three of this code:
Provided, That
in any fiscal year when the amount of money generated by this
subdivision together with the total allocation transferred by the
operation of subdivision (9), subsection (c), section ten of this
article totals eleven million dollars, all subsequent distributions
under this subdivision during that fiscal year shall be deposited
in the special fund established by the licensee and used for
payment of regular purses in addition to other amounts provided in
article twenty-three, chapter nineteen of this code;
(B) The deposit of the four percent of net terminal income
into the Worker's Compensation Debt Reduction Fund pursuant to this
subdivision shall expire and not be imposed with respect to these
funds, which shall be deposited in the special fund established by
the licensee and used for payment of regular purses in addition to
the other amounts provided in article twenty-three, chapter
nineteen of this code on and after the first day of the month
following the month in which the Governor certifies to the Legislature that: (i) The revenue bonds issued pursuant to article
two-d, chapter twenty-three of this code have been retired or
payment of the debt service is provided for; and (ii) that an
independent certified actuary has determined that the unfunded
liability of the Old Fund, as defined in chapter twenty-three of
this code, has been paid or provided in its entirety; and
(10) (A) One percent of the net terminal income shall be
deposited in equal amounts in the Capitol Dome and Improvements
Fund created under section two, article four, chapter five-a of
this code and Cultural Facilities and Capitol Resources Matching
Grant Program Fund created under section three, article one of this
chapter; and
(B) Notwithstanding any provision of paragraph (A) of this
subdivision to the contrary, for each fiscal year beginning after
the thirtieth day of June, two thousand four, this one percent of
net terminal income shall be distributed pursuant to the provisions
of subparagraph (ii), paragraph (B), subdivision (9), subsection
(c), section ten of this article.
(b) The commission may establish orderly and effective
procedures for the collection and distribution of funds under this
section in accordance with the provisions of this section and
section ten of this article.