By: Hinojosa S.B. No. 1013
A BILL TO BE ENTITLED
AN ACT
relating to the continuation and functions of the Texas Racing
Commission, the abolishment of the Equine Research Account Advisory
Committee, and the authority of Texas AgriLife Research; providing
an administrative penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 1.03, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by amending Subdivisions
(37) and (52) and adding Subdivision (80) to read as follows:
(37) "Handicapper" means a person who predicts the
winner of a horse or greyhound race.
(52) "Performance" means the consecutive running of a
specified number of greyhound races as determined by the commission
[not more than 13 greyhound races].
(80) "Handicapper tournament" means a contest
conducted by an association and offered to handicappers on a series
of live or simulcast greyhound or horse races that have been
approved by the commission at the request of the association and
that may be offered for pari-mutuel wagering at the racetrack. The
association may charge a tournament fee to each participating
handicapper.
SECTION 2. Section 2.071, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 2.071. CONFLICT OF INTEREST. (a) A person may not be
a member of the commission and may not be a commission employee
employed in a "bona fide executive, administrative, or professional
capacity," as that phrase is used for purposes of establishing an
exemption to the overtime provisions of the federal Fair Labor
Standards Act of 1938 (29 U.S.C. Section 201 et seq.), if:
(1) the person is an [An] officer, employee, or paid
consultant of a Texas trade association in the field of horse or
greyhound racing or breeding; or
(2) the person's [may not be a member of the commission
or an employee of the commission who is exempt from the state's
position classification plan or is compensated at or above the
amount prescribed by the General Appropriations Act for step 1,
salary group 17, of the position classification salary schedule.
[(b) A person who is the] spouse is [of] an officer,
manager, or paid consultant of a Texas trade association in the
field of horse or greyhound racing or breeding [may not be a member
of the commission and may not be an employee of the commission who
is exempt from the state's position classification plan or is
compensated at or above the amount prescribed by the General
Appropriations Act for step 1, salary group 17, of the position
classification salary schedule].
(b) A person may not be a member of the commission or act as
the general counsel to the commission if the person is required to
register as a lobbyist under Chapter 305, Government Code, because
of the person's activities for compensation on behalf of a
profession related to the operation of the commission.
(c) In [For the purposes of] this section, "Texas trade
association" means [a Texas trade association is] a cooperative and
voluntarily joined statewide [nonprofit] association of business
or professional competitors in this state designed to assist its
members and its industry or profession in dealing with mutual
business or professional problems and in promoting their common
interest.
SECTION 3. Article 2, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 2.25
to read as follows:
Sec. 2.25. USE OF TECHNOLOGY. The commission shall
implement a policy requiring the commission to use appropriate
technological solutions to improve the commission's ability to
perform its functions. The policy must ensure that the public is
able to interact with the commission on the Internet.
SECTION 4. Article 2, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 2.26
to read as follows:
Sec. 2.26. NEGOTIATED RULEMAKING AND ALTERNATIVE DISPUTE
RESOLUTION PROCEDURES. (a) The commission shall develop and
implement a policy to encourage the use of:
(1) negotiated rulemaking procedures under Chapter
2008, Government Code, for the adoption of commission rules; and
(2) appropriate alternative dispute resolution
procedures under Chapter 2009, Government Code, to assist in the
resolution of internal and external disputes under the commission's
jurisdiction.
(b) The commission's procedures relating to alternative
dispute resolution shall conform, to the extent possible, to any
model guidelines issued by the State Office of Administrative
Hearings for the use of alternative dispute resolution by state
agencies.
(c) The commission shall designate a trained person to:
(1) coordinate the implementation of the policy
adopted under Subsection (a) of this section;
(2) serve as a resource for any training needed to
implement the procedures for negotiated rulemaking or alternative
dispute resolution; and
(3) collect data concerning the effectiveness of those
procedures, as implemented by the commission.
SECTION 5. Subsections (b) and (e), Section 3.07, Texas
Racing Act (Article 179e, Vernon's Texas Civil Statutes), are
amended to read as follows:
(b) The commission shall make rules specifying the
authority and the duties of each official, including the power of
stewards or judges to impose penalties for unethical practices or
violations of racing rules. A penalty imposed by the stewards or
judges may include a fine of not more than $5,000, a suspension for
not more than one year, or both a fine and suspension. Before
imposing a penalty under this subsection, the stewards and judges
shall conduct a hearing that is consistent with constitutional due
process. A hearing conducted by a steward or judge under this
subsection is not subject to Chapter 2001, Government Code. A
decision of a steward or judge is subject to review by the executive
director, who may modify the penalty. A penalty modified by the
executive director under this section may include a fine not to
exceed $10,000, a suspension not to exceed two years, or both a fine
and a suspension. A decision of a steward or judge that is not
reviewed or modified by the executive director is a final decision.
Any decision of a steward or judge may be appealed under Section
3.08(a) of this Act regardless of whether the decision is modified
by the executive director [If, in the opinion of the stewards or
judges, the allowable penalties are not sufficient, the stewards or
judges may refer the case to the commission for further action].
(e) To pay the charges associated with the medication or
drug testing, an association may use the money held by the
association to pay outstanding tickets and pari-mutuel vouchers.
If additional amounts are needed to pay the charges, the
association shall pay those additional amounts. [If the amount
held exceeds the amount needed to pay the charges, the association
shall pay the excess to the commission in accordance with Section
11.08 of this Act.]
SECTION 6. Section 3.09, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by amending Subsection
(b) and adding Subsections (c) and (d) to read as follows:
(b) The commission shall deposit the money it collects under
this Act in the State Treasury to the credit of a special fund to be
known as the Texas Racing Commission fund. The Texas Racing
Commission fund may be appropriated only for the administration and
enforcement of this Act. Any unappropriated money remaining in
that special fund at the close of each fiscal biennium shall be
transferred to the General Revenue Fund and may be appropriated for
any legal purpose.
(c) On the first business day of each state fiscal year, the
legislature shall appropriate from the General Revenue Fund into
the Texas Racing Commission fund one-quarter of the money
appropriated to the commission for the state fiscal biennium for
the administration and enforcement of this Act. Not later than the
last day of the state fiscal year in which the general revenue funds
are appropriated, the commission shall reimburse the General
Revenue Fund from the Texas Racing Commission fund or from other
funds available to the commission for the amount deposited in the
Texas Racing Commission fund, including 2.75 percent interest per
year on the amount, with all payments first attributable to the
accrued interest.
(d) The legislature may also appropriate additional money
from the General Revenue Fund for the administration and
enforcement of this Act. Any amount of general revenue
appropriated for the administration and enforcement of this Act in
excess of the cumulative amount deposited in the Texas Racing
Commission fund shall be reimbursed from the Texas Racing
Commission fund not later than one year after the date on which the
general revenue funds are appropriated, with 2.75 [12] percent
interest per year [until August 31, 1993, and 6-3/4 percent
interest thereafter] with all payments first attributable to
interest. In times of fiscal emergency, the legislature may make a
specific appropriation from general revenue that is not subject to
the reimbursement requirements in this section.
SECTION 7. Subsections (a) and (c), Section 5.03, Texas
Racing Act (Article 179e, Vernon's Texas Civil Statutes), are
amended to read as follows:
(a) An applicant for any license or license renewal under
this Act must, except as allowed under Section 7.10 of this Act,
submit to the commission a complete set of fingerprints of the
individual natural person applying for the license or license
renewal or, if the applicant is not an individual natural person, a
complete set of fingerprints of each officer or director and of each
person owning an interest of at least five percent in the applicant.
The Department of Public Safety may request any person owning any
interest in an applicant for a racetrack license to submit a
complete set of fingerprints.
(c) A peace officer of this or any other state, or any
district office of the commission, shall take the fingerprints of
an applicant for a license or license renewal on forms approved and
furnished by the Department of Public Safety and shall immediately
deliver them to the commission.
SECTION 8. Article 5, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 5.011
to read as follows:
Sec. 5.011. INACTIVE FEES. (a) The commission may charge
an annual fee for licensing and regulating a racetrack designated
by the commission as inactive.
(b) The amount of the annual license fee for a racetrack
designated by the commission as inactive must be at least 50 percent
greater than the amount of the annual license fee for a racetrack
holding a similar class of license designated by the commission as
active. The commission shall set the amount of the annual inactive
license fees on a sliding scale that increases the amount based on
the consecutive number of years the license has been designated by
the commission as inactive.
(c) If the commission charges an annual license fee for a
racetrack designated by the commission as inactive, the commission
may use all or a portion of the money collected under this section
to reduce the fees attributable to live racing that are paid by
racetracks designated by the commission as active.
SECTION 9. The heading to Section 6.04, Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), is amended to read
as follows:
Sec. 6.04. ISSUANCE OF LICENSE[; BOND].
SECTION 10. Article 6, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 6.0601
to read as follows:
Sec. 6.0601. LICENSE REVIEW AND RENEWAL; FEES. (a) The
commission shall designate each racetrack license as either active
or inactive. The commission shall designate a racetrack license as
an active license if the license holder:
(1) holds live racing events at the racetrack; or
(2) makes significant efforts to engage in the
construction of a racetrack or other good faith efforts preparatory
to conducting live racing.
(b) The commission by rule shall establish a renewal and
review process for racetrack licenses issued under this article.
(c) The commission shall review each racetrack license
designated by the commission as active not less than once every 10
years, except as otherwise provided by this section.
(d) The commission shall annually review a racetrack
license designated by the commission as inactive.
(e) The commission by rule may adopt a system under which
active racetrack licenses are renewed on various dates in a year or
in various years. For the year in which the license renewal date is
changed, license fees shall be prorated on a monthly basis so that
each license holder pays only that portion of the license fee
allocable to the number of months during which the license is valid.
On renewal, the total license renewal fee is payable.
(f) The commission may require a license holder who is
renewing a racetrack license or who is subject to commission review
of the racetrack license to provide any information that would be
required to be provided in connection with an original license
application under this Act.
(g) In reviewing a racetrack license or in determining
whether to renew a racetrack license, the commission shall
consider:
(1) the license holder's financial stability and
ability to conduct live racing events;
(2) the license holder's ability to construct and
maintain a racetrack facility and to conduct live racing; and
(3) other necessary factors considered in the issuance
of the original license.
(h) The commission may refuse to renew an inactive racetrack
license if, after notice and a hearing, the commission determines
under Subsection (g) of this section that allowing the license
holder to hold the racetrack license is not in the best interests of
the racing industry or the public.
(i) The commission shall renew an active racetrack license
after the commission completes the review of that license. The
commission may revoke an active racetrack license under Section
6.0602 of this Act if, after notice and a hearing, the commission
finds that the license holder has violated this Act or a commission
rule.
(j) The commission shall set and collect renewal and review
fees in amounts reasonable and necessary to cover the costs of
administering and enforcing this Act.
(k) The commission shall consult with members of the racing
industry and other key stakeholders in developing the racetrack
license renewal and review process under this section.
(l) The commission may change the designation of a racetrack
license as appropriate.
SECTION 11. Article 6, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 6.0602
to read as follows:
Sec. 6.0602. DISCIPLINARY ACTION. (a) The commission by
rule shall establish procedures for disciplinary action against a
racetrack license holder.
(b) If, after notice and hearing, the commission finds that
a racetrack license holder or a person employed by the racetrack has
violated this Act or a commission rule or if the commission finds
during a review or renewal that the racetrack is ineligible for a
license under this article, the commission may:
(1) revoke, suspend, or refuse to renew the racetrack
license;
(2) impose an administrative penalty as provided under
Section 15.03 of this Act; or
(3) take any other action as provided by commission
rule.
SECTION 12. Article 6, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 6.0605
to read as follows:
Sec. 6.0605. OWNERSHIP TRANSFER. (a) The commission by
rule shall develop a process for expeditiously processing requests
to transfer ownership of a racetrack license to a racetrack owner
who:
(1) holds an active racetrack license under this Act
at the time a request is submitted; and
(2) is in compliance with the commission's rules and
regulations.
(b) A transfer under this section requires a background
check under Section 6.031 of this Act. If the commission has
required and approved a completed personal, financial, and business
background check of the applicant within 12 months of the
application date, the commission may approve the transfer after
requiring an update of the previously completed background check.
SECTION 13. Section 6.18, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 6.18. ANNUAL FEE FOR RACETRACK [TERM OF] LICENSE[;
RESTRICTIONS ON RACETRACKS]. (a) [A racetrack license issued
under this article is perpetual. The commission may suspend or
revoke a license as provided by this Act.
[(b)] The commission may prescribe a reasonable annual fee to
be paid by each active racetrack license holder [licensee].
(b) The commission may prescribe an annual fee for each
inactive racetrack license holder in an amount greater than the
annual fee paid by an active racetrack license holder.
(c) The [fee must be in an amount sufficient to provide that
the] total amount of fees imposed under this section, together with
the license fees prescribed under Section 5.01(b) of this Act, the
inactive fees described under Section 5.011 of this Act, and the
renewal and review fees prescribed under Section 6.0601(j) of this
Act, must be [is] sufficient to pay the costs of administering and
enforcing this Act.
SECTION 14. Section 7.01, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 7.01. LICENSE REQUIRED. (a) Except as provided by
this section, a [A] person may not participate in racing with
pari-mutuel wagering other than as a spectator or as a person
placing a wager without first obtaining a license from the
commission. A person may not engage in any occupation for which
commission rules require a license under this Act without first
obtaining a license from the commission.
(b) The commission by rule shall categorize the occupations
of racetrack employees and determine the occupations that afford
the employee an opportunity to influence racing with pari-mutuel
wagering. The rules must require the following employees to be
licensed under this Act:
(1) an employee who works in an occupation determined
by the commission to afford the employee an opportunity to
influence racing with pari-mutuel wagering; or
(2) an employee who will likely have significant
access to the backside of a racetrack or to restricted areas of the
frontside of a racetrack.
(c) A racetrack licensed under this Act is responsible for
ensuring that its employees comply with this Act and commission
rules. The commission may impose disciplinary action against a
licensed racetrack for violations of this Act and commission rules
by its employees as provided by Section 6.0602 of this Act.
SECTION 15. Section 7.07, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by amending Subsection
(a) and adding Subsection (a-1) to read as follows:
(a) A license issued under this article is valid for a
period set by the commission not to exceed 36 months following the
date of its issuance. It is renewable on application, satisfactory
results of a criminal history information record check, and payment
of the fee in accordance with the rules of the commission.
(a-1) The commission shall obtain criminal history record
information on each applicant renewing a license under this
article. The commission shall ensure that criminal history record
information is obtained on each license holder at least once every
36 months.
SECTION 16. Section 11.01, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by amending Subsection
(a) and adding Subsection (a-1) to read as follows:
(a) The commission shall adopt rules to regulate wagering on
greyhound races and horse races under the system known as
pari-mutuel wagering. Wagering may be conducted only by an
association within its enclosure. A person may not accept, in
person, by telephone, or over the Internet, a wager for a horse race
or greyhound race conducted inside or outside this state from a
person in this state unless the wager is authorized under this Act.
(a-1) The commission may commission as many investigators
as the commission determines necessary to enforce this Act and the
rules of the commission. Each investigator shall take the
constitutional oath of office and file it with the commission. Each
commissioned investigator has the powers of a peace officer.
SECTION 17. Subsections (a) and (c), Section 11.04, Texas
Racing Act (Article 179e, Vernon's Texas Civil Statutes), are
amended to read as follows:
(a) Only a person inside the enclosure where both live and
simulcast race meetings are authorized may wager on the result of a
live or simulcast race presented by the association in accordance
with commission rules. Except as provided by this section, a person
may not place, in person, by telephone, or over the Internet, a
wager for a horse race or greyhound race conducted inside or outside
this state. The commission shall adopt rules to prohibit wagering
by employees of the commission and to regulate wagering by persons
licensed under this Act.
(c) The commission shall adopt rules prohibiting an
association from accepting a wager made on credit and shall adopt
rules providing for the use of automatic banking machines within
the enclosure. The commission shall limit the use of an automatic
banking machine to[:
[(1)] allow a person to have access to only the
person's checking account at a bank or other financial
institution[; and
[(2) deliver no more than $200].
SECTION 18. Section 11.05, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 11.05. UNLAWFUL WAGERING. A person shall not wager on
the result of a greyhound race or horse race in this state except as
permitted by this Act. A person who is not an association under
this Act may not accept from a Texas resident while the resident is
in this state a wager on the result of a greyhound race or horse race
conducted inside or outside this state.
SECTION 19. Subsection (a), Section 18.01, Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), is amended to read
as follows:
(a) The Texas Racing Commission is subject to Chapter 325,
Government Code (Texas Sunset Act). Unless continued in existence
as provided by that chapter, and except as provided by Subsections
(b) and (c) of this section, the commission is abolished and this
Act expires September 1, 2015 [2009].
SECTION 20. Subdivision (2), Section 88.521, Education
Code, is amended to read as follows:
(2) "Director" means the executive director of Texas
AgriLife Research, formerly known as the Texas Agricultural
Experiment Station.
SECTION 21. Subsections (b), (f), and (g), Section 88.522,
Education Code, are amended to read as follows:
(b) The director shall administer the account through
established procedures of Texas AgriLife Research, formerly known
as the Texas Agricultural Experiment Station.
(f) Not more than 10 percent of the account may be spent each
year on the cost incurred in the operation or administration of the
[advisory committee or] account.
(g) All money received by [the advisory committee or] the
account under this chapter is subject to Subchapter F, Chapter 404,
Government Code.
SECTION 22. Section 88.525, Education Code, is amended by
adding Subsections (a-1) and (b-1) and amending Subsection (b) to
read as follows:
(a-1) In awarding grants under this section, the director
shall comply with the conflict of interest provisions of The Texas
A&M University System.
(b) The [With the advice of the advisory committee, the]
director shall develop annually a request for proposals for equine
research grants. Each proposal received may [must] be evaluated by
a peer review committee appointed by the director and subject
matter experts as necessary to evaluate the proposal. The peer
review committee shall consider the applicant's research capacity
and the relevance and scientific merit of the proposal and make
recommendations to the director.
(b-1) The director may award a grant to an applicant who
proposes to commingle grant money awarded under this section with
other sources of funding or proposes to conduct research that
includes equine research.
SECTION 23. Subsection (a), Section 88.526, Education Code,
is amended to read as follows:
(a) The director shall prepare an annual report on equine
research funded under this subchapter. The director shall
distribute the report to the Texas Racing Commission and [the]
members of the Texas horse racing industry [advisory committee].
The director shall make copies of the report available to
interested parties.
SECTION 24. Section 88.527, Education Code, is amended to
read as follows:
Sec. 88.527. CONFERENCE. Texas AgriLife Research may [The
Texas Agricultural Extension Service shall] conduct an annual
conference on equine research. Money from the equine research
account shall be used to defray the costs of the conference. The
conference must be designed to bring to the attention of the Texas
horse racing industry the latest research results and technological
developments in equine research. The director shall make the
report created under Section 88.526 available at the conference.
SECTION 25. The following provisions of the Texas Racing
Act (Article 179e, Vernon's Texas Civil Statutes) are repealed:
(1) Section 2.072;
(2) Subsection (b), Section 6.04;
(3) Subsection (k), Section 6.06; and
(4) Subsection (a), Section 7.02.
SECTION 26. The following provisions of the Education Code
are repealed:
(1) Subdivision (1), Section 88.521;
(2) Section 88.523;
(3) Section 88.5231;
(4) Section 88.5232;
(5) Section 88.524;
(6) Section 88.5245; and
(7) Subsection (c), Section 88.525.
SECTION 27. (a) Not later than January 1, 2010, the Texas
Racing Commission shall determine the expiration date of each
license issued under the Texas Racing Act (Article 179e, Vernon's
Texas Civil Statutes).
(b) Not later than September 1, 2010, the Texas Racing
Commission shall complete a review of each inactive racetrack
license as required by Section 6.0601, Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), as added by this Act.
(c) The Texas Racing Commission may adjust license renewal
and review fees pursuant to the commission's authority to adjust
fees under Section 5.01, Texas Racing Act (Article 179e, Vernon's
Texas Civil Statutes), and Section 6.0601, Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), as added by this
Act, to recover any money lost by the change in law made by this Act
to Subsection (e), Section 3.07, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes).
(d) As soon as practicable, the executive director of Texas
AgriLife Research shall submit a report to the Texas Racing
Commission as required by Section 88.526, Education Code, as
amended by this Act.
SECTION 28. (a) In this section:
(1) "Active racetrack license" means a racetrack
license designated as active by the commission.
(2) "Commission" means the Texas Racing Commission.
(b) Notwithstanding Section 6.0601, Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), as added by this
Act, the commission shall conduct an initial review of each active
racetrack license not later than September 1, 2011, according to a
schedule developed by the commission based on categories defined by
the level of activity of the license holder.
(c) The commission shall first review each active racetrack
license in the following order:
(1) each active racetrack license held by a person
that owns or operates a racetrack but that does not conduct live
races;
(2) each active racetrack license held by a person
that owns or operates a racetrack and conducts live races; and
(3) each active racetrack license held by a person
that does not conduct live racing but is making good faith efforts
preparatory to conducting live racing.
SECTION 29. Notwithstanding Subsection (a), Section 18.01,
Texas Racing Act (Article 179e, Vernon's Texas Civil Statutes), as
amended by this Act, the Sunset Advisory Commission shall conduct a
special-purpose review of the Texas Racing Commission as part of
the Sunset Advisory Commission's review of agencies for the 82nd
Legislature. The Sunset Advisory Commission's report to the 82nd
Legislature regarding the review of the Texas Racing Commission
must include an evaluation of the Texas Racing Commission's efforts
to implement the changes to the Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes) enacted by this Act. The report may
include any recommendations the Sunset Advisory Commission
considers appropriate based on the review of the Texas Racing
Commission.
SECTION 30. This Act takes effect September 1, 2009.