ENROLLED
COMMITTEE SUBSTITUTE
FOR
H. B. 2632
(By Delegate Mezzatesta)
[Passed March 10, 1995; in effect from passage.]
AN ACT 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; and to
further amend said article by adding thereto a new section,
designated section twelve-c, all relating to pari-mutuel
taxation; providing for an alternative method to calculate
taxes; setting forth specific time periods during which such
alternative method will be in effect; providing for
eligibility to receive awards or purses through the greyhound
breeding development fund; providing for payment of certain
percentage of net simulcast income into thoroughbred
development fund; exception; defining net simulcast income;
repealing the requirement that the handle from televised simulcast racing be included in the calculation of average
daily handle; permitting interstate simulcasting by licensed
racetracks; and providing relief from the two hundred twenty
day racing schedule for cause.
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; and that said
article be further amended by adding thereto a new section,
designated section twenty-three, all to read as follows:
PART VII. TAXATION OF HORSE AND DOG RACING AND PARI-MUTUEL
WAGERING; DISPOSITION OF REVENUES.
ARTICLE 23. HORSE AND DOG RACING.
§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.
(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 to resident owners of accredited West Virginia
whelped greyhounds. In order to be eligible to receive an award or
purse through the fund, the owner of the accredited West Virginia
whelped greyhound must be a resident of this state. 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, owned by
residents of this state 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 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 licensee's control, related to
adverse weather conditions or unforeseen casualty occurrences 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:
Provided, That the
commission shall give consideration to whether there existed
available unscheduled potential live racing dates following the
adverse weather or casualty and prior to the end of the race
meeting which could be used as new live racing dates in order to
maintain a full two hundred twenty day live racing schedule. 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.
(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.
(3) From the licensee commissions authorized by subsection (c)
of this section, after payments are made in accordance with the
provisions of subdivisions (1)and (2) of this subsection, the
licensee shall pay, for each televised racing day on or after the
first day of July, one thousand nine hundred ninety-six, one-half
percent of net simulcast income and for each televised racing day
on or after the first day of July, one thousand nine hundred
ninety-seven, an additional one-half percent of net simulcast
income into the West Virginia thoroughbred development fund
established by the racing commission according to section
thirteen-b of this article:
Provided, That the payments shall be
reduced by an amount equal to one-third of direct simulcast
expenses which shall include, but not be limited to, the cost of
simulcast signals and decoder costs:
Provided, however, That no
licensee qualifying for the alternate tax provisions of subsection
(b), section ten of this article shall be required to make the
payments unless the licensee has participated in the West Virginia
thoroughbred development fund for a period of more than four
consecutive calendar years prior to the thirty-first day of
December, one thousand nine hundred ninety-two. The term "net simulcast income" means the total simulcast handle less direct
simulcast expenses, including, but not limited to, the cost of
simulcast signals and decoder costs.
(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.
§ 19-23-12c. Interstate simulcasts by licensed racetracks.
Any racing association which was licensed under this article
to hold live races during the month of January, 1995, may be
authorized by the commission to transmit broadcasts of races
conducted at its racetrack to legal wagering entities located
outside this state: Provided, That all broadcasts of horse races
shall be in accordance with all of the provisions of the "Federal
Interstate Horseracing Act of 1978", also known as Public Law 95-515, section 3007 of Title 15 of the United States Code.