STATE OF NEW YORK ________________________________________________________________________ 1162 2023-2024 Regular Sessions IN ASSEMBLY January 13, 2023 ___________ Introduced by M. of A. L. ROSENTHAL -- read once and referred to the Committee on Ways and Means 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, 19 shall be paid to the gaming commission to be used exclusively to promote 20 and ensure equine health and safety in New York. Any portion of such 21 funding to the gaming commission unused during a fiscal year shall be 22 returned on a pro rata basis in accordance with the amounts originally EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD04176-01-3
A. 1162 2 1 contributed and shall be used for the purpose of enhancing purses at 2 such tracks] funding the education system of the state of New York, 3 shall be deposited in the state lottery fund for additional lottery 4 grants to eligible school districts, including schools serving students 5 with disabilities and schools with preschool special education programs. 6 [One and one-half percent of the gross purse enhancement amount, as 7 required by this subdivision, shall be paid to an account established 8 pursuant to section two hundred twenty-one-a of the racing, pari-mutuel 9 wagering and breeding law to be used exclusively to provide health 10 insurance for jockeys.] 11 2. [One] Eight and one-half percent of the total wagered after payout 12 of prizes [for the first year of operation of video lottery gaming at 13 Aqueduct racetrack, one and one-quarter percent of the total wagered 14 after payout of prizes for the second year of operation, and one and 15 one-half percent of the total wagered after payout of prizes for the 16 third year of operation and thereafter, for an appropriate breeding fund 17 for the manner of racing conducted at Aqueduct racetrack, Belmont Park 18 racetrack and Saratoga race course] shall be deposited in the state 19 lottery fund for additional lottery grants to eligible school districts, 20 including schools serving students with disabilities and schools with 21 preschool special education programs. 22 3. [Four percent of the total revenue wagered after payout of prizes 23 to be deposited into an account of the franchised corporation estab- 24 lished pursuant to section two hundred six of the racing, pari-mutuel 25 wagering and breeding law to be used for capital expenditures in main- 26 taining and upgrading Aqueduct racetrack, Belmont Park racetrack and 27 Saratoga race course. Capital expenditures may include funding the 28 construction of and initially equipping a state-based equine drug test- 29 ing and research laboratory to be used pursuant to subdivision seven of 30 section nine hundred two of the racing, pari-mutuel wagering and breed- 31 ing law. 32 4. Three percent of the total revenue wagered after payout for prizes 33 to be deposited into an account of the franchised corporation estab- 34 lished pursuant to section two hundred six of the racing, pari-mutuel 35 wagering and breeding law to be used for general thoroughbred racing 36 operations at Aqueduct racetrack, Belmont Park racetrack and Saratoga 37 race course. 38 5.] Paragraphs one[,] and two[, three and four] of this subdivision 39 shall be known collectively as the "[racing] education support 40 payments". 41 § 2. Paragraph 1-b of subdivision b of section 1612 of the tax law, as 42 added by section 2 of part EE of chapter 59 of the laws of 2019, is 43 amended to read as follows: 44 1-b. Notwithstanding any provision of law to the contrary, free play 45 allowance credits authorized by the division pursuant to subdivision i 46 of section sixteen hundred seventeen-a of this article shall not be 47 included in the calculation of the total amount wagered on video lottery 48 games, the total amount wagered after payout of prizes, the vendor fees 49 payable to the operators of video lottery gaming facilities, fees paya- 50 ble to the division's video lottery gaming equipment contractors, [or] 51 racing support payments, or education support payments. 52 § 3. Subdivision f-1 of section 1612 of the tax law, as amended by 53 chapter 175 of the laws of 2013, is amended to read as follows: 54 f-1. As consideration for operation of video lottery gaming facility 55 located in the county of Nassau or Suffolk and operated by a corporation 56 established pursuant to section five hundred two of the racing, pari-mu-
A. 1162 3 1 tuel wagering and breeding law, the division shall cause the [investment 2 in the racing industry of the] following [percentages] percentage of the 3 vendor fee to be deposited or paid as follows: 4 [1. Two and three tenths] Five percent of the total wagered after 5 payout of prizes [for the purpose of enhancing purses at Aqueduct race- 6 track, Belmont Park racetrack and Saratoga race course, provided, howev- 7 er, that any amount that is in excess of the amount necessary to main- 8 tain purse support from video lottery gaming at Aqueduct racetrack, 9 Belmont Park racetrack and Saratoga race course at the same level real- 10 ized in two thousand thirteen, to be adjusted by the consumer price 11 index for all urban consumers, as published annually by the United 12 States department of labor, bureau of labor statistics, shall instead be 13 returned to the commission] shall be deposited in the state lottery fund 14 for additional lottery grants to eligible school districts, including 15 schools serving students with disabilities and schools with preschool 16 special education programs. 17 [2. five tenths percent of the total wagered after payout of prizes 18 for the appropriate breeding fund for the manner of racing at Aqueduct 19 racetrack, Belmont Park racetrack and Saratoga race course, provided, 20 however, that any amount that is in excess of the amount necessary to 21 maintain payments from video lottery gaming at Aqueduct racetrack at the 22 same level realized in two thousand thirteen, to be adjusted by the 23 consumer price index for all urban consumers, as published annually by 24 the United States department of labor, bureau of labor statistics, shall 25 instead be returned to the commission. 26 3. one and three tenths percent of the total revenue wagered after 27 payout of prizes to be deposited into an account of the franchised 28 corporation established pursuant to section two hundred six of the 29 racing, pari-mutuel wagering and breeding law to be used for capital 30 expenditures in maintaining and upgrading Aqueduct racetrack, Belmont 31 Park racetrack and Saratoga race course, provided, however, that any 32 amount that is in excess of the amount necessary to maintain payments 33 for capital expenditures from video lottery gaming at Aqueduct racetrack 34 at the same level realized in two thousand thirteen, to be adjusted by 35 the consumer price index for all urban consumers, as published annually 36 by the United States department of labor, bureau of labor statistics, 37 shall instead be returned to the commission. 38 4. Nine tenths percent of the total revenue wagered after payout for 39 prizes to be deposited into an account of the franchised corporation 40 established pursuant to section two hundred six of the racing, pari-mu- 41 tuel wagering and breeding law to be used for general thoroughbred 42 racing operations at Aqueduct racetrack, Belmont Park racetrack and 43 Saratoga race course, provided, however, that any amount that is in 44 excess of the amount necessary to maintain payments for general 45 thoroughbred racing operations from video lottery gaming at Aqueduct 46 racetrack at the same level realized in two thousand thirteen, to be 47 adjusted by the consumer price index for all urban consumers, as 48 published annually by the United States department of labor, bureau of 49 labor statistics, shall instead be returned to the commission.] 50 § 4. The opening paragraph of paragraph 2 of subdivision b of section 51 1612 of the tax law, as amended by section 2 of part S of chapter 39 of 52 the laws of 2019, is amended to read as follows: 53 As consideration for the operation of a video lottery gaming facility, 54 the division, shall cause the investment [in the racing industry] in 55 those counties that host video lottery gaming facilities, of a portion 56 of the vendor fee received pursuant to paragraph one of this subdivision
A. 1162 4 1 in the manner set forth in this subdivision. With the exception of 2 Aqueduct racetrack, a video lottery gaming facility authorized pursuant 3 to paragraph five of subdivision a of section sixteen hundred seven- 4 teen-a of this article or a facility in the county of Nassau or Suffolk 5 operated by a corporation established pursuant to section five hundred 6 two of the racing, pari-mutuel wagering and breeding law, each such 7 track shall dedicate a portion of its vendor fees, received pursuant to 8 clause (A), (B), (B-1), (B-2), (C), or (D) of subparagraph (ii) of para- 9 graph one of this subdivision, for the purpose of [enhancing purses at 10 such track] funding economic development, job creation, and workforce 11 protections in the counties that host video lottery gaming facilities, 12 in an amount equal to eight and three-quarters percent of the total 13 revenue wagered at the vendor track after pay out for prizes. [One 14 percent of the gross purse enhancement amount, as required by this 15 subdivision, shall be paid to the gaming commission to be used exclu- 16 sively to promote and ensure equine health and safety in New York. Any 17 portion of such funding to the gaming commission unused during a fiscal 18 year shall be returned to the video lottery gaming operators on a pro 19 rata basis in accordance with the amounts originally contributed by each 20 operator and shall be used for the purpose of enhancing purses at such 21 track] Such funds shall be credited to the host county in which each 22 vendor track resides. Such funds shall be utilized by such counties for 23 the purposes of economic development, job creation, and workforce 24 protections. If a vendor track ceases racing operations, such vendor fee 25 shall continue to be paid. 26 [One and one-half percent of the gross purse enhancement amount at a 27 thoroughbred track, as required by this subdivision, shall be paid to an 28 account established pursuant to section two hundred twenty-one-a of the 29 racing, pari-mutuel wagering and breeding law to be used exclusively to 30 provide health insurance for jockeys.] In addition, with the exception 31 of Aqueduct racetrack, a video lottery gaming facility authorized pursu- 32 ant to paragraph five of subdivision a of section sixteen hundred seven- 33 teen-a of this article or a facility in the county of Nassau or Suffolk 34 operated by a corporation established pursuant to section five hundred 35 two of the racing, pari-mutuel wagering and breeding law, one and one- 36 quarter percent of total revenue wagered at the vendor track after pay 37 out for prizes, received pursuant to clause (A), (B), (B-1), (B-2), (C), 38 or (D) of subparagraph (ii) of paragraph one of this subdivision, shall 39 be distributed [to the appropriate breeding fund for the manner of 40 racing conducted by such track] for funding economic development, job 41 creation, and workforce protections in the counties that host video 42 lottery gaming facilities. 43 § 5. Paragraph 3 of subdivision b of section 1612 of the tax law is 44 REPEALED. 45 § 6. Subdivision h of section 1612 of the tax law, as amended by 46 section 3 of part S of chapter 39 of the laws of 2019, is amended to 47 read as follows: 48 h. As consideration for the operation of a video lottery gaming facil- 49 ity located in Orange county, the division shall cause the investment in 50 the [racing industry] education system of the state of New York at the 51 following amount from the vendor fee to be paid as follows: 52 [As amount to the horsemen for purses at a licensed racetrack in 53 Sullivan county in an] An amount equal to eight and three-quarters 54 percent of the total revenue wagered at the video lottery gaming facili- 55 ty, after pay out for prizes to be deposited in the state lottery fund 56 for additional lottery grants to eligible school districts, including
A. 1162 5 1 schools serving students with disabilities and schools with preschool 2 special education programs. [The facility located in Orange county, as 3 defined in paragraph five of subdivision a of section sixteen hundred 4 seventeen-a of this article shall pay to the horsemen at a licensed 5 racetrack at Yonkers racetrack an amount to maintain purses for such 6 horsemen at the same dollar levels realized in two thousand eighteen, to 7 be adjusted by the consumer price index for all urban consumers, as 8 published annually by the United States department of labor bureau of 9 labor statistics.] In addition, one and one-quarter percent of total 10 revenue wagered at the video lottery gaming facility after pay out for 11 prizes, received pursuant to clause (B) of subparagraph (ii) of para- 12 graph one of subdivision b of this section, shall be distributed to the 13 [appropriate breeding] state lottery fund for [the manner of racing 14 conducted by such track] additional lottery grants to eligible school 15 districts, including schools serving students with disabilities and 16 schools with preschool special education programs. In no circumstance 17 shall net proceeds of the lottery, including the proceeds from video 18 lottery gaming, be used for the payment of non-lottery expenses of the 19 gaming commission, administrative or otherwise. 20 § 7. Paragraph 5 of subdivision a of section 1617-a of the tax law, as 21 added by section 4 of part S of chapter 39 of the laws of 2019, is 22 amended to read as follows: 23 (5) At a facility located in Orange county to be operated by the enti- 24 ty otherwise licensed to operate video lottery gaming at Monticello 25 racetrack, provided that: (i) such licensed entity is no longer operat- 26 ing video lottery gaming at Monticello racetrack [and provided that 27 Monticello racetrack is conducting racing operations]; (ii) such facili- 28 ty in Orange county is not sited within a thirty mile radius of the 29 video lottery gaming facility at Yonkers racetrack; and (iii) the 30 licensed entity, its subsidiaries and affiliates, including the entity 31 licensed to operate a commercial gaming facility in Sullivan county, and 32 the entity licensed to operate video lottery gaming at Yonkers racetrack 33 enter into a mitigation agreement, to be approved by the gaming commis- 34 sion, which shall include, but not be limited to, terms that require: 35 (A) the operator of the facility in Orange county to make an annual 36 payment to the entity licensed to operate video lottery gaming or 37 commercial gaming at Yonkers racetrack to account for the effects that 38 siting such facility in Orange county would likely have on the gross 39 gaming revenue of the entity licensed to operate at Yonkers racetrack; 40 (B) employment levels at the affected facilities; and (C) that upon 41 expiration or termination of the agreement, the authority to operate 42 video lottery gaming in Orange county shall cease. Notwithstanding any 43 other provision of this subdivision, at no time shall an entity operat- 44 ing video lottery gaming in Orange county be permitted to apply for or 45 receive a license to operate a commercial gaming facility in that coun- 46 ty. 47 § 8. Paragraph (b) of subdivision 1 of section 1355 of the racing, 48 pari-mutuel wagering and breeding law is REPEALED. 49 § 9. Severability. If any provision or term of this act is, for any 50 reason, declared unconstitutional or invalid or ineffective by any 51 competent jurisdiction, such decision shall not affect the validity of 52 the effectiveness of the remaining portions of this act or any part 53 thereof. 54 § 10. This act shall take effect immediately.