83R9395 GCB-F
By: Hinojosa S.B. No. 1494
A BILL TO BE ENTITLED
AN ACT
relating to the licensing and regulation of horse and greyhound
racing; providing penalties; authorizing a fee.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 321, Government Code, is amended by
adding Section 321.024 to read as follows:
Sec. 321.024. AUDIT OF TEXAS RACING COMMISSION. (a) The
State Auditor shall conduct the following audits of the Texas
Racing Commission:
(1) a financial audit under Section 321.0131;
(2) a compliance audit under Section 321.0132;
(3) an economy and efficiency audit under Section
321.0133; and
(4) an effectiveness audit under Section 321.0134.
(b) In conducting the audits required by this section, the
State Auditor shall require the Texas Racing Commission to provide
explanations for all expenditures made by the commission for the
state fiscal biennium ending August 31, 2013. The State Auditor
shall electronically submit a report containing the results of the
audit to each person listed in Sections 321.014(c)(1), (2), (3),
and (6) not later than October 1, 2014.
(c) This section expires January 1, 2015.
SECTION 2. Section 1.02, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 1.02. PURPOSE. The purpose of this Act is to provide
for the promotion, development, and [strict] regulation of horse
racing and greyhound racing and the control of pari-mutuel wagering
in connection with that racing.
SECTION 3. Section 2.071(b), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(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.
SECTION 4. Section 2.11, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Subsection (e)
to read as follows:
(e) The commission in executive session shall review an
association's management, concession, or totalisator contract and
a security plan for a racetrack facility.
SECTION 5. Section 2.12, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Subsection (e)
to read as follows:
(e) The commission may not employ or continue to employ a
person:
(1) who is licensed by any state as an attorney and
whose primary employment responsibility is to provide legal advice
or counsel to commission members or employees; or
(2) whose primary employment responsibility is to
manage information technology services or maintain information
databases used by the commission or its employees in the
administration or enforcement of this Act.
SECTION 6. Section 2.14, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 2.14. LEGAL REPRESENTATION. (a) The attorney general
shall designate at least one member of the attorney general's staff
to counsel and advise the commission and its employees on all issues
associated with the administration and enforcement of this Act and
to represent the commission in all legal matters, including
administrative proceedings conducted by the State Office of
Administrative Hearings or racing stewards or judges. The attorney
general shall make available to the appropriate prosecuting
attorneys any information obtained regarding violations of this
Act.
(b) The attorney general may require the commission, in an
interagency agreement, to agree to pay the actual costs incurred by
the attorney general in providing legal services authorized under
this section.
SECTION 7. Article 2, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Section 2.141
to read as follows:
Sec. 2.141. INFORMATION TECHNOLOGY SERVICES. (a) The
Department of Information Resources shall provide the commission
and commission employees all services relating to information
technology that are necessary for the administration and
enforcement of this Act. To the extent practicable, the department
shall continue using information technology systems and databases
developed for and in use by the commission until the systems and
databases are outdated.
(b) The Department of Information Resources may require the
commission, in an interagency agreement, to agree to pay the actual
costs incurred by the department in providing information
technology services authorized under this section.
SECTION 8. Section 2.15, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 2.15. RECORDS. (a) All records of the commission that
are not made confidential by other law are open to inspection by the
public during regular office hours.
(b) All applications for a license under this Act shall be
maintained by the commission and shall be available for public
inspection during regular office hours.
(c) The contents of the investigatory files of the
commission[, however,] are not public records, are not subject to a
request under Chapter 552, Government Code, and are confidential
except in a criminal proceeding, in a hearing conducted by the
commission, on court order, or with the consent of the party being
investigated.
(d) An association's management, concession, or totalisator
contract or a security plan for a racetrack facility that is
submitted to the commission is not a public record and is not
subject to Chapter 552, Government Code.
SECTION 9. Section 3.02, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by amending Subsections
(a) and (c) and adding Subsection (h) to read as follows:
(a) The commission shall regulate and supervise every race
meeting in this state involving wagering on the result of greyhound
or horse racing. All persons and things relating to the operation
of those meetings are subject to regulation and supervision by the
commission. The commission shall adopt rules for conducting
greyhound or horse racing in this state involving wagering and
shall adopt other rules to administer this Act that are consistent
with this Act. The commission shall also make rules[, issue
licenses,] and take any other necessary action relating exclusively
to horse racing or to greyhound racing.
(c) The commission or a section of the commission shall hold
a meeting on any proposed rule before the commission publishes the
proposed rule in the Texas Register. Before holding a meeting
required by this subsection, the commission shall ensure the text
of the proposed rule and a request for comments on the rule are
provided to the license holders most likely to be affected by the
proposed rule. At a meeting held under this subsection, the
commission shall consider all comments received and determine
whether the proposed rule is likely to promote or develop the
pari-mutuel racing industry in this state. The commission may not
adopt a rule that the commission determines is solely regulatory
and serves no pari-mutuel promotional or developmental purpose.
(h) In administering and enforcing this Act, the commission
shall ensure the rules and regulatory processes of the commission
promote and develop the pari-mutuel racing industry in this state.
SECTION 10. Sections 3.07(a) and (b), Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), are amended to read
as follows:
(a) [The commission shall employ all of the judges and all
of the stewards for the supervision of a horse race or greyhound
race meeting.] Each horse race or greyhound race meeting shall be
supervised by three stewards for horse racing or by three judges for
greyhound racing. The commission shall employ a [designate one of
the stewards or judges as the] presiding steward or judge for each
race meeting. The association, following the completion of the
race meeting, may submit written comments to the commission
regarding the job performance of the stewards and judges for the
commission's review. Comments received are not binding, in any
way, on the commission. For each race meeting, the commission shall
employ [at least] one state veterinarian. [The commission may, by
rule, impose a fee on an association to offset the costs of
compensating the stewards, judges, and state veterinarians. The
amount of the fee for the compensation of stewards, judges, and
state veterinarians must be reasonable according to industry
standards for the compensation of those officials at other
racetracks and may not exceed the actual cost to the commission for
compensating the officials.] All other racetrack officials shall
be appointed by the association, with the approval of the
commission. Compensation for those officials not compensated by
the commission shall be determined by the association.
(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. Except as otherwise provided by this
subsection, a [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. For a violation of a
rule adopted under Section 3.16 of this Act involving the
possession or use of a substance that is a stimulant or depressant
drug with a significant pharmacologic potential to affect
performance and no generally accepted use in the veterinary care of
a race animal, the racing stewards or judges may bar a person for
life or a shorter period determined by the commission from applying
for or receiving a license issued by the commission or from entering
any part of the premises of a racetrack facility. 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.]
SECTION 11. Section 3.16, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Subsection (k)
to read as follows:
(k) The commission by rule may adopt, for use by racing
stewards or judges or the commission in assessing penalties for
violations of rules adopted under this section, a classification
for prohibited substances, including drugs and chemicals, and a
schedule for recommended disciplinary action to be imposed for the
possession or use of a prohibited substance. The classification
and schedule must be based on the pharmacology of the substance, the
ability of the substance to influence the outcome of a race
regardless of whether the substance has a legitimate therapeutic
use in the veterinary care of a race animal, and other evidence that
the substance may be used improperly. In adopting rules under this
section, the commission shall require the revocation of a license
and the permanent exclusion under Section 13.01 of this Act for a
violation of a rule by the possession or use of a substance that is a
stimulant or depressant, has a significant pharmacologic potential
to affect performance, and has no generally accepted use in the
veterinary care of a race animal.
SECTION 12. Sections 5.01(a), (b), and (d), Texas Racing
Act (Article 179e, Vernon's Texas Civil Statutes), are amended to
read as follows:
(a) The commission shall prescribe forms for applications
for occupational licenses and shall provide each occupational
licensee with a license certificate or credentials.
(b) The commission shall annually prescribe reasonable
license fees for each category of occupational license issued under
this Act.
(d) The commission by rule may charge an annual license fee
for a racetrack license. The amount of the fee may not exceed:
(1) for a class 1 horse racetrack license, $150,000;
(2) for a class 2 horse racetrack license, $100,000;
(3) for a class 3 horse racetrack license, $75,000;
(4) for a class 4 horse racetrack license, $20,000;
and
(5) for a greyhound racetrack license, $100,000 [shall
set fees in amounts reasonable and necessary to cover the
commission's costs of regulating, overseeing, and licensing live
and simulcast racing at racetracks].
SECTION 13. Sections 5.03(a) and (b), Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), are amended to read
as follows:
(a) An applicant for any occupational 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.]
(b) If a complete set of fingerprints is required by the
commission, the commission shall, not later than the 10th business
day after the date the commission receives the prints, forward the
prints to the Department of Public Safety or the Federal Bureau of
Investigation. If the prints are forwarded to the Department of
Public Safety, the department shall classify the prints and check
them against its fingerprint files and shall report to the
commission its findings concerning the criminal record of the
applicant or the lack of such a record. [A racetrack license may
not be issued until the report is made to the commission.] A
temporary occupational license may be issued before a report is
made to the commission.
SECTION 14. Section 5.04(a), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(a) The commission is authorized to obtain any criminal
history record information that relates to each applicant for
employment by the commission and to each applicant for an
occupational [a] license issued by the commission and that is
maintained by the Department of Public Safety or the Federal Bureau
of Investigation Identification Division. The commission may
refuse to issue an occupational license to a person [recommend an
applicant] who fails to provide a complete set of fingerprints.
SECTION 15. Section 5.05(a), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(a) The commission shall, in determining the amount of an
occupational [a] license fee, set the fee in an amount that will
cover, at least, the cost of conducting a criminal history check on
the applicant for the [a] license.
SECTION 16. Section 6.01, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 6.01. LICENSE REQUIRED. A person may not conduct
wagering on a greyhound race or a horse race meeting unless the
person holds [without first obtaining] a racetrack license issued
by [from] the commission. A person who violates this section
commits an offense.
SECTION 17. Section 6.032(a), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(a) The commission at any time may require a holder of a
racetrack license [or an applicant for a racetrack license] to post
security in an amount reasonably necessary, as provided by
commission rule, to adequately ensure the license holder's [or
applicant's] compliance with substantive requirements of this Act
and commission rules.
SECTION 18. Sections 6.06(a), (b), (e), (f), and (k), Texas
Racing Act (Article 179e, Vernon's Texas Civil Statutes), are
amended to read as follows:
(a) To preserve and protect the public health, welfare, and
safety, the commission shall adopt rules relating to [license
applications,] the financial responsibility, moral character, and
ability of racetrack licensees [applicants], and all matters
relating to the planning, construction, and operation of
racetracks. The commission may [refuse to issue a racetrack
license or may] revoke or suspend a racetrack license if, after
notice and hearing, it has reasonable grounds to believe and finds
that:
(1) the licensee [applicant] has been convicted in a
court of competent jurisdiction of a violation of this Act or any
rule adopted by the commission or that the licensee [applicant] has
aided, abetted, or conspired with any person to commit such a
violation;
(2) the licensee [applicant] has been convicted of a
felony or of any crime involving moral turpitude, including
convictions for which the punishment received was a suspended
sentence, probation, or a nonadjudicated conviction, that is
reasonably related to the licensee's [applicant's] present fitness
to hold a license under this Act;
(3) the licensee [applicant] has violated or has
caused to be violated this Act or a rule of the commission in a
manner that involves moral turpitude, as distinguished from a
technical violation of this Act or of a rule;
(4) the licensee [applicant] is unqualified, by
experience or otherwise, to perform the duties required of a
licensee under this Act;
(5) the licensee [applicant] failed to answer or
falsely or incorrectly answered a question in the original license
[an] application;
(6) the licensee [applicant] fails to disclose the
true ownership or interest in a greyhound or horse as required by
the rules of the commission;
(7) the licensee [applicant] is indebted to the state
for any fees or for the payment of a penalty imposed by this Act or
by a rule of the commission;
(8) the licensee [applicant] is not of good moral
character or the [applicant's] reputation of the licensee as a
peaceable, law-abiding citizen in the community where the licensee
[applicant] resides is bad;
(9) the licensee [applicant] has not yet attained the
minimum age necessary to purchase alcoholic beverages in this
state;
(10) the licensee [applicant] is in the habit of using
alcoholic beverages to an excess or uses a controlled substance as
defined in Chapter 481, Health and Safety Code, or a dangerous drug
as defined in Chapter 483, Health and Safety Code, or is mentally
incapacitated;
(11) the licensee [applicant] may be excluded from a
track enclosure under this Act;
(12) [the applicant has not been a United States
citizen residing in this state for the period of 10 consecutive
years immediately preceding the filing of the application;
[(13)] the licensee [applicant] has improperly used a
license certificate, credential, or identification card issued
under this Act;
(13) [(14)] the licensee [applicant] is residentially
domiciled with a person whose license has been revoked for cause
within the preceding 12-month period;
(14) [12 months immediately preceding the date of the
present application;
[(15) the applicant has failed or refused to furnish a
true copy of the application to the commission's district office in
the district in which the premises for which the permit is sought
are located;
[(16)] the licensee [applicant] is engaged or has
engaged in activities or practices that the commission finds are
detrimental to the best interests of the public and the sport of
greyhound racing or horse racing; or
(15) [(17)] the licensee [applicant] fails to fully
disclose the true owners of all interests, beneficial or otherwise,
in the licensee [a proposed racetrack facility].
(b) Subsection (a) of this section applies to a licensee
that is a corporation, partnership, limited partnership, or any
other organization or group [whose application is comprised of more
than one person] if any provision in Subsection (a) of this section
applies to a shareholder, partner, limited partner, director, or
officer of the licensee [is disqualified under Subsection (a) of
this section].
(e) The commission may condition [the issuance of a license
under this article on the observance of its rules. The commission
may amend the rules at any time and may condition] the continued
holding of a racetrack [the] license on compliance with the
commission's rules as amended.
(f) The commission may [refuse to issue a license or may]
suspend or revoke a license of a licensee under this article if the
licensee [who] knowingly or intentionally allows access to an
enclosure where greyhound races or horse races are conducted to a
person who has engaged in bookmaking, touting, or illegal wagering,
whose income is from illegal activities or enterprises, or who has
been convicted of a violation of this Act.
(k) The commission shall review the ownership and
management of an active license issued under this article every
five years beginning on the fifth anniversary of the issuance of the
license. In performing the review, the commission may require the
license holder to provide any information that would be required to
be provided in connection with an original license application
under Article 5 of this Act or this article. [The commission shall
charge fees for the review in amounts sufficient to implement this
subsection.]
SECTION 19. Section 6.13(b), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(b) Each transaction that involves an acquisition or a
transfer of an ownership [a pecuniary] interest of five percent or
more in the association must receive [prior] approval from the
commission. For a transaction requiring approval under this
subsection, the commission may require the association to submit to
the commission only the following information:
(1) the name, address, and fingerprints of an
individual new owner; or
(2) the name, address, and fingerprints of each person
who holds an ownership interest in the entity of 25 percent or more,
for a new owner entity [A transaction that changes the ownership of
the association requires submission of updated information of the
type required to be disclosed under Subsection (a) of Section 6.03
of this Act and payment of a fee to recover the costs of the criminal
background check].
SECTION 20. Section 7.03, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 7.03. ISSUANCE. The commission shall issue an
occupational [a] license to a qualified person on application and
payment of the license fee.
SECTION 21. Section 7.05(a), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(a) The commission shall adopt by rule a fee schedule for
occupational licenses issued under this article.
SECTION 22. Sections 7.07(a) and (b), Texas Racing Act
(Article 179e, Vernon's Texas Civil Statutes), are amended to read
as follows:
(a) An occupational [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.
(b) The commission by rule may adopt a system under which
occupational licenses expire on various dates during the year. For
the year in which the license expiration date is changed, license
fees shall be prorated on a monthly basis so that each licensee pays
only that portion of the license fee that is allocable to the number
of months during which the license is valid. On renewal of the
license on the new expiration date, the total license renewal fee is
payable.
SECTION 23. Section 11.01(a), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended 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.]
SECTION 24. Section 11.04(a), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(a) Only a person inside the enclosure of a facility
operated by an association authorized to conduct [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.
SECTION 25. 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) A person commits an
offense if the person places a [shall not] wager on the result of a
live or simulcast greyhound race or horse race in a manner other
than [in this state except] as permitted by this Act while the
person is in this state. An offense under this subsection is a
Class B misdemeanor.
(b) A person commits an offense if the person is not an
association licensed by the commission and the person accepts [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 live or simulcast greyhound race or horse race conducted inside
or outside this state. An offense under this subsection is a Class
A misdemeanor, except that the offense is a felony of the third
degree if the actor accepts a wager by telephone or over the
Internet.
SECTION 26. Section 13.01, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended to read as follows:
Sec. 13.01. REGULATION BY COMMISSION. The commission shall
adopt rules providing for the exclusion or ejection from an
enclosure where greyhound races or horse races are conducted, or
from specified portions of an enclosure, of a person:
(1) who has engaged in bookmaking, touting, or illegal
wagering;
(2) whose income is from illegal activities or
enterprises;
(3) who has been convicted of a violation of this Act;
(4) who has been convicted of theft;
(5) who has been convicted under the penal law of
another jurisdiction for committing an act that would have
constituted a violation of any of the rules mentioned in this
section;
(6) who has committed a corrupt or fraudulent act in
connection with greyhound racing or horse racing or pari-mutuel
wagering or who has committed any act tending or intended to corrupt
greyhound racing or horse racing or pari-mutuel wagering in this
state or elsewhere;
(7) who is under suspension or ruled off a racetrack by
the commission or a steward in this state or by a corresponding
authority in another state because of fraudulent or corrupt
practices or other acts detrimental to racing;
(8) who has submitted a forged pari-mutuel ticket or
has altered or forged a pari-mutuel ticket for cashing or who has
cashed or caused to be cashed an altered, raised, or forged
pari-mutuel ticket;
(9) who has been convicted of committing a lewd or
lascivious act or other crime involving moral turpitude;
(10) who is guilty of boisterous or disorderly conduct
while inside a racing enclosure;
(11) who is an agent or habitual associate of a person
excludable under this section; [or]
(12) who has been convicted of a felony; or
(13) who the commission has found to be the trainer of
a race animal that the trainer knowingly allowed to participate in a
race with pari-mutuel wagering while the animal had in its system a
stimulant or depressant drug that has a significant pharmacologic
potential to affect performance and has no generally accepted use
in the veterinary care of the animal.
SECTION 27. Section 14.10, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), is amended by adding Subsection (e)
to read as follows:
(e) A person commits an offense if the person is the trainer
of a race animal and the person knowingly allows the animal to
participate in a race with pari-mutuel wagering while the animal
has in its system a prohibited substance. Except as otherwise
provided by this subsection, an offense under this subsection is a
Class A misdemeanor. An offense under this subsection is a felony
of the third degree if the prohibited substance found in the race
animal's system is a stimulant or depressant drug that has a
significant pharmacologic potential to affect performance and has
no generally accepted use in the veterinary care of the animal.
SECTION 28. Section 14.15(c), Texas Racing Act (Article
179e, Vernon's Texas Civil Statutes), is amended to read as
follows:
(c) Except as otherwise provided by this subsection, an [An]
offense under Subsection (a) of this section is a Class A
misdemeanor, except that the offense is:
(1) a state jail felony if [, unless] the actor is
[was] required by this Act to obtain a racetrack license; and
(2) a felony of the third degree if the actor accepts a
wager from a person in this state by telephone or over the Internet
[, in which event it is a state jail felony].
SECTION 29. Sections 6.03, 6.031, 6.04, 6.06(c), (d), and
(i), 6.0602(e), 6.07(c), and 6.18, Texas Racing Act (Article 179e,
Vernon's Texas Civil Statutes), are repealed.
SECTION 30. The change in law made by this Act applies only
to an offense committed on or after the effective date of this Act.
An offense committed before the effective date of this Act is
governed by the law in effect on the date the offense was committed,
and the former law is continued in effect for that purpose. For
purposes of this section, an offense was committed before the
effective date of this Act if any element of the offense occurred
before that date.
SECTION 31. This Act takes effect September 1, 2013.