H. B. 2632
(By Delegate Mezzatesta)
[Introduced February 22, 1995; referred to the
Committee on Finance.]
A BILL to amend and reenact sections ten and twelve-b, article
twenty-three, chapter nineteen of the code of West Virginia,
one thousand nine hundred thirty-one, as amended, relating
to pari-mutuel and daily license tax.
Be it enacted by the Legislature of West Virginia:
That sections ten and twelve-b, article twenty-three,
chapter nineteen of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, be amended and reenacted to read
as follows:
ARTICLE 23. HORSE AND DOG RACING.
PART VII. TAXATION OF HORSE AND DOG RACING AND PARI-MUTUEL
WAGERING; DISPOSITION OF REVENUES.
§19-23-10. Daily license tax; pari-mutuel pools tax; how taxes
paid; alternate tax; credits.
(a) Any racing association conducting thoroughbred racing at
any horse racetrack in this state shall pay each day upon which
horse races are run a daily license tax of two hundred fifty
dollars. Any racing association conducting harness racing at any
horse racetrack in this state shall pay each day upon which horse
races are run a daily license tax of one hundred fifty dollars.
Any racing association conducting dog races shall pay each day
upon which dog races are run a daily license tax of one hundred
fifty dollars. In the event thoroughbred racing, harness racing,
dog racing, or any combination of the foregoing are conducted on
the same day at the same racetrack by the same racing
association, only one daily license tax in the amount of two
hundred fifty dollars shall be paid for that day. Any daily
license tax shall not apply to any local, county or state fair,
horse show or agricultural or livestock exposition at which horse
racing is conducted for not more than six days.
(b) Any racing association licensed by the racing commission to conduct thoroughbred racing and permitting and conducting
pari-mutuel wagering under the provisions of this article shall,
in addition to the daily license tax set forth in subsection (a)
of this section, pay to the racing commission, from the
commission deducted each day by the licensee from the pari-mutuel
pools on thoroughbred racing a tax calculated on the total daily
contribution of all pari-mutuel pools conducted or made at any
and every thoroughbred race meeting of the licensee licensed
under the provisions of this article. The tax, on the
pari-mutuel pools conducted or made each day during the months of
January, February, March, October, November and December, shall
from the effective date of this section and for fiscal year one
thousand nine hundred eighty-five, be calculated at two and
six-tenths percent; for fiscal year one thousand nine hundred
eighty-six, be calculated at two and three-tenths percent; for
fiscal year one thousand nine hundred eighty-seven, be calculated
at two percent of the pool; for fiscal year one thousand nine
hundred eighty-eight, be calculated at one and one-half percent;
for fiscal year one thousand nine hundred eighty-nine, be
calculated at one percent of the pool; for fiscal year one thousand nine hundred ninety, seven tenths of one percent, and
for fiscal year one thousand nine hundred ninety-one and each
fiscal year thereafter be calculated at four tenths of one
percent of the pool; and, on the pari-mutuel pools conducted or
made each day during all other months, shall from the effective
date of this section and for fiscal year one thousand nine
hundred eighty-five, be calculated at three and six-tenths
percent; for fiscal year one thousand nine hundred eighty-six, be
calculated at three and three-tenths percent; for fiscal year one
thousand nine hundred eighty-seven, be calculated at three
percent of the pool; for fiscal year one thousand nine hundred
eighty-eight, be calculated at two and one-half percent; for
fiscal year one thousand nine hundred eighty-nine, be calculated
at two percent of the pool; for fiscal year one thousand nine
hundred ninety, be calculated at one and seven-tenths percent of
the pool; and for fiscal year one thousand nine hundred
ninety-one and each fiscal year thereafter, be calculated at one
and four-tenths percent of the pool: Provided, That out of the
amount realized from the three tenths of one percent decrease in
the tax effective for fiscal year one thousand nine hundred ninety-one and thereafter, which decrease correspondingly
increases the amount of commission retained by the licensee, the
licensee shall annually expend or dedicate (i) one half of the
realized amount for capital improvements in its barn area at the
track, subject to the racing commission's prior approval of the
plans for the improvements, and (ii) the remaining one half of
the realized amount for capital improvements as the licensee may
determine appropriate at the track. The term "capital
improvement" shall be as defined by the Internal Revenue Code:
Provided, however, That any racing association operating a horse
racetrack in this state having an average daily pari-mutuel pool
on horse racing of two hundred eighty thousand dollars or less
per day for the race meetings of the preceding calendar year
shall, in lieu of payment of the pari-mutuel pool tax, calculated
as in this subsection, be permitted to conduct pari-mutuel
wagering at the horse racetrack on the basis of a daily
pari-mutuel pool tax fixed as follows: On the daily pari-mutuel
pool not exceeding three hundred thousand dollars the daily
pari-mutuel pool tax shall be one thousand dollars plus the
otherwise applicable percentage rate imposed by this subsection of the daily pari-mutuel pool, if any, in excess of three hundred
thousand dollars: Provided further, That upon the effective date
of the reduction of the daily pari-mutuel pool tax to one
thousand dollars from the former two thousand dollars, the
association or licensee shall daily deposit five hundred dollars
into the special fund for regular purses established by
subdivision (1), subsection (b), section nine of this article:
And provided further, That if an association or licensee
qualifying for the foregoing alternate tax conducts more than one
racing performance, each consisting of up to ten races in a
calendar day, the association or licensee shall pay both the
daily license tax imposed in subsection (a) of this section and
the alternate tax in this subsection for each performance: And
provided further, That a licensee qualifying for the foregoing
alternate tax is excluded from participation in the fund
established by section thirteen-b of this article: And provided
further, That this exclusion shall not apply to any thoroughbred
racetrack at which the licensee has participated in the West
Virginia thoroughbred development fund for more than four
consecutive years prior to the thirty-first day of December, one thousand nine hundred ninety-two: And provided further, That at
those thoroughbred racetracks participating in the West Virginia
thoroughbred development fund authorized by section thirteen-b of
this article, the licensee shall be exempt from paying any daily
license tax and pari-mutuel pools tax from the commissions
authorized by subsection (c), section twelve-b of this article.
Such exemption shall be in effect upon passage of this amendment
and continue only for fiscal years one thousand nine hundred
ninety-six and one thousand nine hundred ninety-seven and during
this period, one half of the daily license tax and pari-mutuel
pools tax that otherwise would have been paid, notwithstanding
the exemption, shall be deposited daily by the licensee into the
special fund for regular purses established by subdivision (1),
subsection (b), section nine of this article.
(c) Any racing association licensed by the racing commission
to conduct harness racing and permitting and conducting
pari-mutuel wagering under the provisions of this article shall,
in addition to the daily license tax required under subsection
(a) of this section, pay to the racing commission, from the
commission deducted each day by the licensee from the pari-mutuel pools on harness racing, as a tax, three percent of the first one
hundred thousand dollars wagered, or any part thereof; four
percent of the next one hundred fifty thousand dollars; and five
and three-fourths percent of all over that amount wagered each
day in all pari-mutuel pools conducted or made at any and every
harness race meeting of the licensee licensed under the
provisions of this article.
(d) Any racing association licensed by the racing commission
to conduct dog racing and permitting and conducting pari-mutuel
wagering under the provisions of this article shall, in addition
to the daily license tax required under subsection (a) of this
section, pay to the racing commission, from the commission
deducted each day by the licensee from the pari-mutuel pools on
dog racing, as a tax, four percent of the first fifty thousand
dollars or any part thereof of the pari-mutuel pools, five
percent of the next fifty thousand dollars of the pari-mutuel
pools, six percent of the next one hundred thousand dollars of
the pari-mutuel pools, seven percent of the next one hundred
fifty thousand dollars of the pari-mutuel pools, and eight
percent of all over three hundred fifty thousand dollars wagered each day: Provided, That the licensee shall deduct daily from
the pari-mutuel tax an amount equal to one tenth of one percent
of the daily pari-mutuel pools in dog racing in fiscal year one
thousand nine hundred ninety; fifteen hundredths of one percent
in fiscal year one thousand nine hundred ninety-one; two tenths
of one percent in fiscal year one thousand nine hundred
ninety-two; one quarter of one percent in fiscal year one
thousand nine hundred ninety-three; and three tenths of one
percent in fiscal year one thousand nine hundred ninety-four and
every fiscal year thereafter. The amounts deducted shall be paid
to the racing commission to be deposited by the racing commission
in a banking institution of its choice in a special account to be
known as "West Virginia Racing Commission-Special Account-West
Virginia Greyhound Breeding Development Fund." The purpose of
the fund is to promote better breeding and racing of greyhounds
in the state through awards and purses for accredited West
Virginia whelped greyhounds. The moneys shall be expended by the
racing commission for purses for stake races, supplemental purse
awards, administration, promotion and educational programs
involving West Virginia whelped dogs, under rules and regulations promulgated by the racing commission. The racing commission
shall pay out of the greyhound breeding development fund to each
of the licensed dog racing tracks the sum of seventy-five
thousand dollars for the fiscal year ending the thirtieth day of
June, one thousand nine hundred ninety-four. The licensee shall
deposit the sum into the special fund for regular purses
established under the provisions of section nine of this article.
The funds shall be expended solely for the purpose of
supplementing regular purses under rules and regulations
promulgated by the racing commission.
Supplemental purse awards will be distributed as follows:
Supplemental purses shall be paid directly to the owner of an
accredited greyhound or, if the greyhound is leased, the owner
may choose to designate a percentage of the purse earned directly
to the lessor as agreed to via a written purse distribution form
on file with the racing commission.
The owner of accredited West Virginia whelped greyhounds
that earn a purse at any West Virginia meet will receive a bonus
award calculated at the end of each month as a percentage of the
fund dedicated to the owners as purse supplements, which shall be a minimum of fifty percent of the total moneys deposited into the
West Virginia greyhound breeding development fund monthly.
The total amount of the fund available for the owners'
awards shall be distributed according to the ratio of purses
earned by an accredited greyhound to the total amount earned in
races by all accredited West Virginia whelped greyhounds for that
month as a percentage of the funds dedicated to the owners' purse
supplements.
The owner of an accredited West Virginia whelped greyhound
shall file a purse distribution form with the racing commission
for a percentage of his or her dog's earnings to be paid directly
to the lessor of the greyhound. Distribution shall be made on
the fifteenth day of each month for the preceding month's
achievements.
In no event shall purses earned at a meet held at a track
which did not make contributions to the West Virginia greyhound
breeder's development fund out of the daily pool on the day the
meet was held qualify or count toward eligibility for
supplemental purse awards.
Any balance in the purse supplement funds after all distributions have been made for the year revert to the general
account of the fund for distribution in the following year.
In an effort to further promote the breeding of quality West
Virginia whelped greyhounds, a bonus purse supplement shall be
established in the amount of fifty thousand dollars per annum, to
be paid in equal quarterly installments of twelve thousand five
hundred dollars per quarter using the same method to calculate
and distribute these funds as the regular supplemental purse
awards. This bonus purse supplement is for three years only,
commencing on the first day of July, one thousand nine hundred
ninety-three, and ending the thirtieth day of June, one thousand
nine hundred ninety-six. This money would come from the current
existing balance in the greyhound development fund.
Each pari-mutuel greyhound track shall provide stakes races
for accredited West Virginia whelped greyhounds: Provided, That
each pari-mutuel track shall have one juvenile and one open stake
race annually. The racing commission shall oversee and approve
racing schedules and purse amounts.
Ten percent of the deposits into the greyhound breeding
development fund beginning the first day of July, one thousand nine hundred ninety-three and continuing each year thereafter,
shall be withheld by the racing commission and placed in a
special revenue account hereby created in the state treasury
called the "administration, promotion and educational account."
The racing commission is authorized to expend the moneys
deposited in the administration, promotion and educational
account at such times and in such amounts as the commission
determines to be necessary for purposes of administering and
promoting the greyhound development program: Provided, That
beginning with fiscal year one thousand nine hundred ninety-five
and in each fiscal year thereafter in which the commission
anticipates spending any money from the account, the commission
shall submit to the executive department during the budget
preparation period prior to the Legislature convening before that
fiscal year for inclusion in the executive budget document and
budget bill, the recommended expenditures, as well as requests of
appropriations for the purpose of administration, promotion and
education. The commission shall make an annual report to the
Legislature on the status of the administration, promotion and
education account, including the previous year's expenditures and projected expenditures for the next year.
The racing commission, for the fiscal year one thousand nine
hundred ninety-four only, may expend up to thirty-five thousand
dollars from the West Virginia greyhound breeding development
fund to accomplish the purposes of this section without strictly
following the requirements in the previous paragraph.
(e) All daily license and pari-mutuel pools tax payments
required under the provisions of this section shall be made to
the racing commission or its agent after the last race of each
day of each horse or dog race meeting, and the pari-mutuel pools
tax payments shall be made from all contributions to all
pari-mutuel pools to each and every race of the day.
(f) Every association or licensee subject to the provisions
of this article, including the changed provisions of sections
nine and ten of this article, shall annually submit to the racing
commission and the Legislature financial statements, including a
balance sheet, income statement, statement of change in financial
position and an audit of any electronic data system used for
pari-mutuel tickets and betting, prepared in accordance with
generally accepted auditing standards, as certified by an experienced public accountant or a certified public accountant.
§19-23-12b. Televised racing days; merging of pari-mutuel
wagering pools.
(a) For the purposes of this section:
(1) "Televised racing day" means a calendar day, assigned by
the commission, at a licensed racetrack on which pari-mutuel
betting is conducted on horse or dog races run at racetracks
outside of the state which are broadcast by television at a
licensed racetrack and which day or days have had the prior
written approval of the representative of the majority of the
owners and trainers who hold permits required by section two of
this article; and
(2) "Host racing association" means any person who, pursuant
to a license or other permission granted by the host state,
conducts the horse or dog race subject to the interstate wager.
(b) A licensee conducting not less than two hundred twenty
live racing dates for each horse or dog race meeting may, with
the prior approval of the state racing commission, contract with
any legal wagering entity in any other state to receive telecasts
and accept wagers on races conducted by the legal wagering entity: Provided, That at those thoroughbred racetracks
participating in the West Virginia thoroughbred development fund
authorized by section thirteen-b of this article, the licensee,
in applying for racing dates, shall apply for not less than two
hundred twenty live racing dates for each horse race meeting.
If, thereafter, for reasons beyond the licensees control, the
licensee concludes that this number of racing days cannot be
attained, the licensee may file a request with the racing
commission to reduce the authorized live racing days. Upon
receipt of the request the racing commission shall within
seventy-two hours of the receipt of the request notify the
licensee and the representative of a majority of the owners and
trainers at the requesting track that such request has been
received and that if no objection to the request is received
within ten days of the notification the request will be approved.
If an objection is received by the commission within the time
limits, the commission shall establish a binding arbitration
board. The board shall consist of one member appointed by the
licensee, one member appointed by the representative of a
majority of the owners and trainers at the racetrack and a third member to be selected by the two appointed members. In the event
the two members cannot agree on the third member, each member
shall submit two names to the racing commission and from those
names the racing commission shall appoint the third member of the
board. The board shall hear from all parties concerned and
thereupon shall make recommendations to the racing commission on
the required number of live racing days. The recommendations of
the board are final. The telecasts may be received and wagers
accepted at any location authorized by the provisions of section
twelve-a of this article. The contract must receive the approval
of the representative of the majority of the owners and trainers
who hold permits required by section two of this article at the
receiving racetrack.
(c) The commission may allow the licensee to commingle its
wagering pools with the wagering pools of the host racing
association. If the pools are commingled, the wagering at the
licensee's racetrack must be on tabulating equipment capable of
issuing pari-mutuel tickets and be electronically linked with the
equipment at the sending racetrack. Subject to the approval of
the commission, the types of betting, licensee commissions and distribution of winnings on pari-mutuel pools of the sending
licensee racetrack are those in effect at the licensee racetrack.
Breakage for pari-mutuel pools on a televised racing day must be
calculated in accordance with the law or rules governing the
sending racetrack and must be distributed in a manner agreed to
between the licensee and the sending racetrack.
(d) The commission may assign televised racing days at any
time. When a televised racing day is assigned, the commission
shall assign either a steward or an auditor to preside over the
televised races at the licensee racetrack.
(e) (1) From the licensee commissions authorized by
subsection (c) of this section, the licensee shall pay one tenth
of one percent of each commission into the general fund of the
county, in which the racetrack is located and at which the
wagering occurred and there is imposed and the licensee shall
pay, for each televised racing day on which the total pari-mutuel
pool exceeds one hundred thousand dollars, the greater of either:
(i) The total of the daily license tax and the pari-mutuel pools
tax required by section ten of this article; or (ii) a daily
license tax of one thousand two hundred fifty dollars. For each televised racing day on which the total pari-mutuel pool is one
hundred thousand dollars or less, the licensee shall pay a daily
license tax of five hundred dollars plus an additional license
tax of one hundred dollars for each ten thousand dollars, or part
thereof, that the pari-mutuel pool exceeds fifty thousand
dollars, but does not exceed one hundred thousand dollars.
Payments of the tax imposed by this section are subject to the
requirements of subsection (e), section ten of this article:
Provided, That at those thoroughbred racetracks participating in
the West Virginia thoroughbred development fund authorized by
section thirteen-b of this article, the licensee shall be exempt
from paying the daily license tax imposed in subsection (a) of
this section and exempt from paying the pari-mutuel pool tax as
calculated in this subsection and exempt from paying the
alternate tax as calculated in this subsection from the
commissions deducted each day by the licensee from the
pari-mutuel pools on thoroughbred racing. Such exemption shall
be in effect upon passage of this amendment and continue only for
fiscal years one thousand nine hundred ninety-six and one
thousand nine hundred ninety-seven and during this period, one half of the alternate tax that otherwise would have been paid,
notwithstanding the exemption, shall be deposited daily by the
licensee into the special fund for regular purses established by
subdivision (1), subsection (b), section nine of this article.
(2) From the licensee commissions authorized by subsection
(c) of this section, after payments are made in accordance with
the provisions of subdivision (1) of this subsection, the
licensee shall pay, for each televised racing day, one fourth of
one percent of the total pari-mutuel pools 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 and to be used for payments into the pension plan for
all employees of the licensed racing association.
(f) After deducting the tax required by subsection (e) of
this section, the amount required to be paid under the terms of
the contract with the legal wagering entity of another state and
the cost of transmission, the horse racing association shall make
a deposit equal to fifty percent of the remainder into the purse
fund established under the provisions of subdivision (1),
subsection (b), section nine of this article.
(g) The provisions of the "Federal Interstate Horseracing
Act of 1978", also known as Public Law 95-515, Section 3001-3007
of Title 15, U.S. Code, as amended, controls in determining the
intent of this section.
(h) On and after the first day of January, one thousand nine
hundred ninety-five, the handle from televised simulcast racing
shall be included in the calculation of "average daily handle" as
it is calculated in section ten of this article to determine the
alternative daily pari-mutuel pool tax.
NOTE: The purpose of this bill is to provide pari-mutuel
and daily license tax moratorium.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.