To repeal sections 313.540 and 313.660, RSMo 1994, relating to off-track pari-mutuel wagering, and to enact in lieu thereof ten new sections relating to the same subject, with penalty provisions.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF MISSOURI, AS FOLLOWS:

Section A. Sections 313.540 and 313.660, RSMo 1994, are repealed and ten new sections enacted in lieu thereof, to be known as sections 313.540, 313.660, 1, 2, 3, 4, 5, 6, 7, and 8, to read as follows:

313.540. 1. The commission shall have powers to prescribe and enforce rules and regulations governing horse races and race meetings, including licensed off-track pari-mutuel wagering regulated pursuant to sections 1 to 7 of this act. All pari-mutuel wagering of any kind or matter placed in the state of Missouri shall be transmitted through facilities licensed by the commission. Such rules and regulations shall contain criteria to be used by the commission for decisions on approving and revoking race track licenses and setting racing dates. The commission may delegate to the stewards such of the commission's powers and duties as may be necessary to carry out and effectuate the purposes of sections 313.500 to 313.710 and the commission may designate persons employed by the commission to ensure that operations conducted by off-track pari-mutuel licensees are in compliance with sections 313.500 to 313.710 and sections 1 to 7 of this act. Any decision or action of such stewards may be appealed to the commission or may be reviewed by the commission on its own initiative.

2. No rule or portion of a rule promulgated pursuant to the authority of this section shall become effective unless it has been promulgated pursuant to the provisions of section 536.024, RSMo.

313.660. 1. No individual shall for a fee, directly or indirectly, accept anything of value to be wagered or to be transmitted or delivered for wager in any pari-mutuel system of wagering on horse racing or for a fee deliver anything of value which has been received outside of the enclosure of a race track holding a horse race licensed [under] pursuant to sections 313.500 to 313.710, other than within the enclosure of an off-track pari- mutuel facility licensed pursuant to sections 1 to 7 of this act, to be placed as wagers in the pari-mutuel pool within such enclosure.

2. Any individual violating the provisions of this section shall upon conviction be guilty of a class C felony.

Section 1. As used in sections 1 to 7 of this act, the following terms mean:

(1) "Applicant", any person applying for a license to accept off-track pari-mutuel wagers. If the applicant is a corporation, partnership or other person as that term is defined in section 351.015, RSMo, the term includes the officers and members of the board of directors of the corporation or the general partners of a partnership or persons performing similar functions of any business from applying for such a license;

(2) "Breakage", the odd cents over a multiple of ten cents arising from the computation of odds and payouts on amounts wagered on a race which is part of an interstate common pari-mutuel pool;

(3) "Commission", the Missouri horse racing commission or its successor agency;

(4) "Commission on wagers", an amount retained and not returned to patrons by an off-track pari-mutuel licensee from the total amount of off-track pari-mutuel wagers;

(5) "Interstate common pari- mutuel pool", a pari-mutuel pool consisting of the pari-mutuel wagers placed at a pari-mutuel facility, its intrastate betting locations, off-track pari-mutuel wagering locations in other jurisdictions and the off-track pari-mutuel wagers placed and accepted at an off-track pari-mutuel wagering licensee;

(6) "Missouri bred horse", any thoroughbred or standard- bred equine which was foaled within this state or any thoroughbred or standard-bred equine foal, where the mare of such foal is domiciled in this state;

(7) "Off-track pari- mutuel system", a computerized system or component of a system that is used to transmit wagering data to and from a race track which offers interstate common pari-mutuel pools;

(8) "Off-track pari-mutuel wagering", any pari-mutuel system of wagering approved by the commission for the acceptance of off- track pari-mutuel wagers on races which take place outside of this state;

(9) "Off-track pari-mutuel license", a license issued by the commission which authorizes the holder to operate facilities at which it simulcasts races from other states and at which it accepts off-track pari-mutuel wagers for inclusion in an interstate common pari-mutuel pool;

(10) "Simulcast", the audio and visual transmission of a race, or series of races, as it occurs at a track.

Section 2. 1. A person shall not accept off-track pari- mutuel wagers for inclusion in an interstate common pari-mutuel pool unless it has received a license from the commission to accept such wagers. Collation of such wagering need not take place within this state, and such collation process shall be approved by the commission.

2. The commission shall issue no more than five licenses to accept off-track pari-mutuel wagering, except that when two years have elapsed after the issuance of the fifth license, the commission may issue two additional licenses based on economic feasibility and may reduce the one hundred mile limitation prescribed in paragraph (a) of subdivision (6) of section 3 of this act by rule, except that the commission shall not reduce such limitation to less than twenty- five miles from an existing licensee without the consent of such licensee. Each license authorizes the holder to operate one off- track pari-mutuel wagering facility plus one off-track pari- mutuel wagering operation for each casino located within the one hundred mile radius pursuant to subdivision (6) of section 3 of this act, such operation may be located either in the support facilities or the casino, and each license authorizes the holder to receive simulcasts at the off-track pari-mutuel wagering facility and accept off-track pari-mutuel wagers for inclusion in an interstate common pari-mutuel pool. A person may hold more than one license to accept off-track pari-mutuel wagering.

3. Applications for a license to accept off-track pari- mutuel wagers shall be made, processed, and determined using such forms as the commission may require or approve. The application shall fully identify the applicant, include a showing of financial responsibility of the applicant, describe the names and identification of those who will supervise the manner of wagering and the controls and supervision by the licensee and describe the general physical layout of the off-track pari-mutuel wagering facility and its location. The applicant for such license shall file with the application a nonrefundable fee of fifty thousand dollars. The applicant shall be responsible for the total cost of the investigation. If the cost of the investigation exceeds the total amount of fees filed by the applicant in this subsection, the commission may assess additional fees as it deems appropriate; however, if the applicant is denied a license, the applicant shall be entitled to a refund of the difference between the application fee and the actual cost of the investigation. The license shall be valid until revoked for cause, sold or transferred.

4. The commission shall not issue a license to accept off-track pari-mutuel wagers unless the applicant is a resident of Missouri, or in the case of a corporation, partnership or other business form, it incorporated or formed in Missouri.

5. The commission shall not issue a license to accept off-track pari-mutuel wagers unless the commission is satisfied that the applicant:

(1) Is a person of good character, honesty and integrity;

(2) Is a person whose prior activities, reputation, habits and associations do not pose a threat to the public interest of this state or to the effective regulation and control of off- track pari-mutuel wagering, or create or enhance the dangers of unsuitable, unfair or illegal practices, methods and activities in the conduct of off-track pari-mutuel wagering or the carrying on of the business and financial arrangements incidental thereto;

(3) Has not been convicted of a felony under the laws of this state, any other state or the United States;

(4) Is in all other respects qualified to be licensed consistently with the policies of the state.

6. The commission shall not issue a license to any applicant except upon the express condition that the licensee shall not, by any lease, contract, understanding or arrangement of whatever kind or nature, grant, assign or turn over to any person, corporation, partnership or business from the operation or management of the off-track pari-mutuel wagering facility without the prior approval of the commission. Nothing contained in this section prohibits:

(1) The licensee from paying a percentage of the amounts wagered at the off-track pari- mutuel wagering facility to a track for the right to be part of an interstate common pari-mutuel pool and for the right to receive a simulcast from the track; or

(2) The licensee from paying a percentage of the amounts wagered at the off-track pari-mutuel wagering facility to an individual, corporation, partnership, or other entity as compensation for the services of an off-track pari-mutuel system.

7. An application to receive a license constitutes a request for a determination of the applicant's general character, integrity, and ability to participate or engage in, or be associated with off-track pari-mutuel wagering.

8. The commission shall not issue a license to any applicant except on the express condition that the licensee will agree to provide at the request of the commission one and one-half percent of all commissions on wagers collected by that licensee for the purpose of improving the horse racing industry in this state by augmenting purses for horses which are bred in Missouri. The commission may authorize the use of twenty-five percent of these moneys for interest-free loans to qualified applicants to build horse racing tracks in this state, and may authorize the use of the remaining seventy- five percent of these moneys for augmentation of the purses for horse races conducted in this state involving Missouri bred horses.

Section 3. The commission shall have full jurisdiction over and shall supervise all off-track pari-mutuel wagering governed by sections 1 to 7 of this act and shall have the following powers and duties:

(1) To investigate the qualifications of each applicant pursuant to sections 1 to 7 of this act before any license is issued and to continue to observe the conduct of all licensees and other persons having a material involvement directly or indirectly with a licensee by unqualified, disqualified or unsuitable person, or persons whose operations are conducted in an unsuitable manner or in unsuitable or prohibited places or locations;

(2) To deny any application or limit, condition, restrict, revoke or suspend any license, or fine any person licensed for any cause deemed reasonable by the commission. Any person aggrieved by any action of the commission authorized in this subdivision may appeal such action to a court of competent jurisdiction;

(3) To levy administrative penalties of up to two thousand dollars per day against the licensees who violate the provisions of sections 1 to 7 of this act;

(4) To enter the premises of the off-track pari-mutuel wagering facility or other places of business of a licensee within this state to determine compliance with sections 1 to 7 of this act;

(5) To investigate alleged violations of sections 1 to 7 of this act or the commission's rules, orders or final decisions and to take appropriate disciplinary action against a licensee for a violation or institute appropriate legal action for enforcement or both;

(6) To adopt standards for the facilities within which off-track pari-mutuel wagering will be conducted, except that the commission shall not issue a license to accept off-track pari-mutuel wagers unless the facility at which the off-track pari-mutuel wagers will be accepted:

(a) Is located within a one-hundred-mile radius of a metropolitan statistical area, as designated by the federal office of management and budget, with a population of nine hundred thousand or more persons according to the latest official United States decennial census;

(b) Be designed to seat patrons comfortably, with multiple screens to enable each patron to view simulcast races, and be designed in such a manner as to resemble the clubhouse facilities of a licensed race track;

(c) Be suitable for licensing by the division of liquor control; and

(d) Have food and beverage services available at all hours in which the facility is open to the public;

(7) To require a licensee to remove a person violating any provision of sections 1 to 7 of this act or the commission rules from the off-track pari-mutuel wagering facility;

(8) To require the removal from the premises of a licensee, or an employee of a licensee, for any violation of sections 1 to 7 of this act or a commission rule or engaging in a fraudulent practice;

(9) To require licensed off-track pari-mutuel licensees to file an annual balance sheet and profit and loss statement pertaining to the licensee's off-track pari-mutuel wagering in this state;

(10) To issue subpoenas for the attendance of witnesses and subpoenas duces tecum for the production of books, records, and other pertinent documents, and to administer oaths and affirmations to the witnesses, when, in the judgment of the commission, it is necessary to enforce sections 1 to 7 of this act or the commission rules;

(11) To keep accurate and complete records of its proceedings and to certify the records as may be appropriate;

(12) To ensure that off-track pari-mutuel wagering is conducted fairly;

(13) To take any other action as may be reasonable or appropriate to enforce sections 1 to 7 of this act and the commission rules.

Section 4. 1. An off-track pari- mutuel licensee shall not use an off-track pari-mutuel system unless the system has been approved for use by the commission. The physical location of the system may be in a state other than Missouri. An off-track pari-mutuel wagering system shall:

(1) Include a fully redundant computer;

(2) Receive, aggregate by pool, and report to a track at regular intervals to be approved by the commission, all off-track pari-mutuel wagering information received from the off-track pari-mutuel licensee;

(3) Receive and report to the off-track pari-mutuel licensee at regular intervals to be approved by the commission, all wagering data received from the track to the system;

(4) After each race on which pari-mutuel wagering is conducted is declared official, receive and report to the off-track pari-mutuel licensee the results and payoff prices reported by the track; and

(5) Provide all accounting and reconciliation reports required by the commission.

2. Operators of the off-track pari-mutuel system shall:

(1) Currently be licensed by the commission, or similar authority in another state, as an off- track pari-mutuel system operator and have held such license for a period of not less than two consecutive years;

(2) Provide an additional source of racing related information, in addition to the racing related information received through the licensees simulcasts and the off-track pari- mutuel system, which produces hard copy reports on a day-to-day basis. Such additional information shall be provided to licensee to ensure that the patrons engaged in wagering at the facility are provided with current and accurate racing related information and also to provide licensees' and the commission's auditing staffs information necessary to efficiently audit and monitor the operation of the facility. Such hard copy information will be retained by licensee for a period of not less than three years; and

(3) By using communication equipment other than that used to transmit simulcasts or to facilitate the off- track pari-mutuel wagering system:

(a) Be able to contact each licensee immediately; and

(b) Be able at all times to respond immediately to licensee requests for confirmation of information included in the simulcasts or generated by the off-track pari-mutuel system.

3. An off-track pari-mutuel licensee shall allow patrons to cash an outstanding off-track pari-mutuel ticket for thirty days from the date of purchase. Tickets which are not redeemed within such time become valueless, unless the time period is otherwise extended by the licensee, and the sum of money represented by them shall accrue to the licensee.

4. A person under eighteen years of age shall not be allowed to place an off- track pari-mutuel wager.

Section 5. 1. The total percentage of off-track pari-mutuel wagers that is to be deducted as a commission on wagers, excluding breakage, shall be the same percentage as deducted by the track, unless a different percentage is otherwise approved by the commission. The licensee shall quarterly distribute the amounts deducted as follows:

(1) Two and one-half percent of all commissions on wagers shall be paid to the state of Missouri, with the costs of administering sections 1 to 7 of this act borne by the commission to be paid from such funds;

(2) Three percent of all commissions on wagers shall be paid to the Missouri elementary and secondary education technology training fund established by section 8 of this act; and

(3) The remainder of the commissions on wagers and the breakage shall be retained by the licensee, except for the one and one-half percent commissions on wagers pursuant to subsection 8 of section 2 of this act.

2. In each week in which it has accepted off-track pari-mutuel wagers, the licensee shall file a report with the commission reporting the total amount of money wagered during the period. Such report shall be required of the licensee not more often than weekly.

3. No other license tax, permit tax, occupation tax, or taxes or fees applicable solely to licensees licensed pursuant to the provisions of sections 1 to 7 of this act shall be levied, assessed, or collected from a licensee by the state or by a political subdivision, except as provided in sections 1 to 7 of this act, except that the provisions of this subsection shall not apply to income taxes, sales taxes, earnings taxes, property taxes or any other tax or fee now or hereafter lawfully levied by the state or any political subdivision thereof on taxpayers which are not licensed pursuant to the provisions of sections 1 to 7 of this act.

Section 6. 1. A person is guilty of a class A misdemeanor for any of the following:

(1) Operating off-track pari-mutuel wagering without a license issued by the commission; or

(2) Operating off-track pari- mutuel wagering where wagering is permitted other than in the manner specified by sections 1 to 7 of this act.

2. A person knowingly permitting a person under eighteen years of age to make a wager is guilty of a class B misdemeanor.

Section 7. The state of Missouri recognizes the Interstate Horse Racing Act of 1978, 15 U.S.C. Section 3001 et seq., and the remedies provided therein. Any organization licensed by the commission to conduct a horse racing meeting pursuant to sections 313.500 to 313.710, RSMo, and sections 1 to 7 of this act is deemed to have consented to the acceptance of off-track pari-mutuel wagers by off-track pari-mutuel licenses.

Section 8. 1. There is hereby established in the state treasury the "Missouri Elementary and Secondary Education Technology Training Fund". Three percent of all commissions on wagers collected by the Missouri horse racing commission pursuant to subdivision (2) of subsection 1 of section 5 of this act shall be transferred to the director of revenue for deposit in the state treasury to the credit of the fund established by this section.

2. The fund shall be subject to appropriations by the general assembly solely to provide funding to programs which further training, instruction and education concerning computers and other advanced technologies for those persons receiving an elementary or secondary education.

3. The provisions of section 33.080, RSMo, to the contrary notwithstanding, moneys in the fund established by this section shall not be transferred and placed to the credit of the general revenue fund.

4. All administrative costs of the fund established by this section which are incurred by the Missouri horse racing commission or the director of revenue in collecting or receiving the commissions on wagers pursuant to this section and subdivision (2) of subsection 1 of section 5 of this act shall be paid from such fund, and such costs to either the commission or the director shall not exceed one percent.