Authorizes racetracks and off-track betting corporations to offer rebates on pari-mutuel wagers made by bettors and to horse racing patrons

This bill establishes a statutory framework to create such rebate programs and guidelines for approval of such rebate programs by the State Gaming Commission (Commission). Adopting this bill should provide applicants with parameters in which to draft applications to the Commission for approval to establish systemic long range rebate programs to encourage attendance at race tracks or other gaming facilities. These types of long term rebate or fan appreciation programs are authorized and conducted by many out-of-state racing forums, but are not authorized in New York.

Summary of provisions

Section 1: Adds Racing & Wagering Law section 109-a to clearly establish in the law the ability of host racetracks and OTBs to establish long term rebate or fan appreciation programs that can last for an entire racing season or calendar year for new or preferred customers who attend host race track meets or bet on such events. The definition of a rebate is a reduction in the takeout percentage, adding a bonus on winnings obtained, or awards of merchandise or services for certain previously designated customers.

The Commission must annually approve of the rebate programs. This bill gives reasonable latitude to the Commission to establish and approve of rebate programs so that rebate program applications and approval of such programs can quickly change to reflect the betting practices within the racing industry.

There are several conditions that the applicant must abide by when administering any rebate or fan appreciation programs to protect consumer interests. The conditions are that: a disclosure of benefits of past rebate programs is required, rebates are granted solely on the amount wagered or the frequency of betting, accurate record keeping is maintained on rebate program disbursements and the rebate programs a.re in the best interests of racing.

Existing law

There is currently no statutory framework to assist a racetrack or OTB to develop and implement long term rebate programs that can be approved by the Commission.

Justification

Many off-shore betting houses are offering rebate or fan appreciation programs to encourage patronage of their racing events. Off shore betting houses have the freedom to establish long term betting rebate programs to secure and retain a loyal customer base. New York Producers are not able to establish entire race season or annual betting rebate programs to help them secure and retain a loyal customer base. These out-of-state rebate programs may be one reason why increases in New York State betting handle has been depressed. This bill merely authorizes New York racetrack operators and OTBs to offer their patrons the same types of rebate programs that are being offered elsewhere. Further, while the Commission has authorized some rebate programs, they tend to be single event programs and not the long term programs that are needed to maintain a strong fan base.

Legislative history

This bill is similar to S.577A of 2007. While this bill was vetoed by Governor Spitzer, this current bill was revised to address the concerns that were raised by that veto message. Further, this bill was amended to conform to the new statutory frame work established when forming the new State Gaming Commission.

Fiscal implications

None.

Effective date

The same date upon which Chapter 60 of the Laws of 2012 takes effect.