LBD14884-01-2
S. 6792 2
track after payout for prizes pursuant to this chapter, except for such
facility located in the county of Westchester, in which case the rate
shall be thirty percent until March thirty-first, two thousand twelve.
Notwithstanding the foregoing, not later than April first, two thou-
sand twelve, the vendor fee AT SUCH TRACK OR VENDOR OFF-TRACK BETTING
FACILITY shall become thirty-one percent and remain at that level there-
after; and except for Aqueduct racetrack, in which case the vendor fee
shall be thirty-eight percent of the total revenue wagered at the vendor
track after payout for prizes pursuant to this chapter;
(C) notwithstanding clauses (A) and (B) of this subparagraph, when the
vendor track OR VENDOR OFF-TRACK BETTING FACILITY is located in an area
with a population of less than one million within the forty mile radius
around such track, at a rate of thirty-nine percent for the first fifty
million dollars annually, twenty-eight percent for the next hundred
million dollars annually, and twenty-five percent thereafter of the
total revenue wagered at the vendor track OR VENDOR OFF-TRACK BETTING
FACILITY after payout for prizes pursuant to this chapter;
(D) notwithstanding clauses (A), (B) and (C) of this subparagraph,
when the vendor track OR VENDOR OFF-TRACK BETTING FACILITY is located
within fifteen miles of a Native American class III gaming facility at a
rate of forty-one percent of the total revenue wagered at the vendor
track after payout for prizes pursuant to this chapter;
(E) notwithstanding clauses (A), (B), (C) and (D) of this subpara-
graph, when a Native American class III gaming facility is established,
after the effective date of this subparagraph, within fifteen miles of
the vendor track OR VENDOR OFF-TRACK BETTING FACILITY, at a rate of
forty-one percent of the total revenue wagered after payout for prizes
pursuant to this chapter;
(E-1) for purposes of this subdivision, the term "class III gaming"
shall have the meaning defined in 25 U.S.C. S 2703(8).
(F) notwithstanding clauses (A), (B), (C), (D) and (E) of this subpar-
agraph, when a vendor track, is located in Sullivan county and within
sixty miles from any gaming facility in a contiguous state such vendor
fee shall, for a period of five years commencing April first, two thou-
sand eight, be at a rate of forty-one percent of the total revenue
wagered at the vendor track after payout for prizes pursuant to this
chapter, after which time such rate shall be as for all tracks in clause
(C) of this subparagraph.
(G) notwithstanding clauses (A), (B), (C), (D), (E) and (F) of this
subparagraph, when no more than one vendor track located in the town of
Thompson in Sullivan county at the site of the former Concord Resort at
which a qualified capital investment has been made and no fewer than one
thousand full-time, permanent employees have been newly hired, is
located in Sullivan county and is within sixty miles from any gaming
facility in a contiguous state, then for a period of forty years the
vendor's fee shall equal the total revenue wagered at the vendor track
after payout of prizes pursuant to this subdivision reduced by the
greater of (i) twenty-five percent of total revenue after payout for
prizes for "video lottery games" or (ii) for the first eight years of
operation thirty-eight million dollars, and beginning in the ninth year
of operation such amount shall increase annually by the lesser of the
increase in the consumer price index or two percent, plus seven percent
of total revenue after payout of prizes. In addition, in the event the
vendor fee is calculated pursuant to subclause (i) of this clause, the
vendor's fee shall be further reduced by 11.11 percent of the amount by
which total revenue after payout for prizes exceeds two hundred fifteen
S. 6792 3
million dollars, but in no event shall such reduction exceed five
million dollars.
Provided, however, that in the case of no more than one vendor track
located in the town of Thompson in Sullivan county at the site of the
former Concord Resort with a qualified capital investment, and one thou-
sand full-time, permanent employees if at any time after three years of
opening operations of the licensed video gaming facility or licensed
vendor track, the vendor track experiences an employment shortfall, then
the recapture amount shall apply, for only such period as the shortfall
exists.
For the purposes of this section "qualified capital investment" shall
mean an investment of a minimum of six hundred million dollars as
reflected by audited financial statements of which not less than three
hundred million dollars shall be comprised of equity and/or mezzanine
financing as an initial investment in a county where twelve percent of
the population is below the federal poverty level as measured by the
most recent Bureau of Census Statistics prior to the qualified capital
investment commencing that results in the construction, development or
improvement of at least one eighteen hole golf course, and the
construction and issuance of certificates of occupancy for hotels, lodg-
ing, spas, dining, retail and entertainment venues, parking garages and
other capital improvements at or adjacent to the licensed video gaming
facility or licensed vendor track which promote or encourage increased
attendance at such facilities.
For the purposes of this section, "full-time, permanent employee"
shall mean an employee who has worked at the video gaming facility,
vendor track or related and adjacent facilities for a minimum of thir-
ty-five hours per week for not less than four consecutive weeks and who
is entitled to receive the usual and customary fringe benefits extended
to other employees with comparable rank and duties; or two part-time
employees who have worked at the video gaming facility, vendor track or
related and adjacent facilities for a combined minimum of thirty-five
hours per week for not less than four consecutive weeks and who are
entitled to receive the usual and customary fringe benefits extended to
other employees with comparable rank and duties.
For the purpose of this section "employment goal" shall mean one thou-
sand five hundred full-time permanent employees after three years of
opening operations of the licensed video gaming facility or licensed
vendor track.
For the purpose of this section "employment shortfall" shall mean a
level of employment that falls below the employment goal, as certified
annually by vendor's certified accountants and the chairman of the
empire state development corporation.
For the purposes of this section "recapture amount" shall mean the
difference between the amount of the vendor's fee paid to a vendor track
with a qualified capital investment, and the vendor fee otherwise paya-
ble to a vendor track pursuant to clause (F) of this subparagraph, that
is reimbursable by the vendor track to the division for payment into the
state treasury, to the credit of the state lottery fund created by
section ninety-two-c of the state finance law, due to an employment
shortfall pursuant to the following schedule only for the period of the
employment shortfall:
(i) one hundred percent of the recapture amount if the employment
shortfall is greater than sixty-six and two-thirds percent of the
employment goal;
S. 6792 4
(ii) seventy-five percent of the recapture amount if the employment
shortfall is greater than thirty-three and one-third percent of the
employment goal;
(iii) forty-nine and one-half percent of the recapture amount if the
employment shortfall is greater than thirty percent of the employment
goal;
(iv) twenty-two percent of the recapture amount if the employment
shortfall is greater than twenty percent of the employment goal;
(v) eleven percent of the recapture amount if the employment shortfall
is greater than ten percent of the employment goal.
(H) notwithstanding clauses (A), (B), (C), (D), (E), (F) and (G) of
this subparagraph, the track operator of a vendor track OR OFF-TRACK
BETTING OPERATOR OF A VENDOR OFF-TRACK BETTING CORPORATION shall be
eligible for a vendor's capital award of up to four percent of the total
revenue wagered at the vendor track OR VENDOR OFF-TRACK BETTING FACILITY
after payout for prizes pursuant to this chapter, which shall be used
exclusively for capital project investments to improve the facilities of
the vendor track OR VENDOR OFF-TRACK BETTING FACILITY which promote or
encourage increased attendance at the video lottery gaming facility
including, but not limited to hotels, other lodging facilities, enter-
tainment facilities, retail facilities, dining facilities, events
arenas, parking garages and other improvements that enhance facility
amenities; provided that such capital investments shall be approved by
the division, in consultation with the state racing and wagering board,
and that such vendor track OR VENDOR OFF-TRACK BETTING FACILITY demon-
strates that such capital expenditures will increase patronage at such
vendor track's OR VENDOR'S OFF-TRACK BETTING facilities and increase the
amount of revenue generated to support state education programs. The
annual amount of such vendor's capital awards that a vendor track shall
be eligible to receive shall be limited to two million five hundred
thousand dollars, except for Aqueduct racetrack, for which there shall
be no vendor's capital awards. Except for tracks OR OFF-TRACK BETTING
FACILITIES having less than one thousand one hundred video gaming
machines, each track operator OR OFF-TRACK BETTING FACILITY OPERATOR
shall be required to co-invest an amount of capital expenditure equal to
its cumulative vendor's capital award. For all tracks OR OFF-TRACK
BETTING FACILITIES, except for Aqueduct racetrack, the amount of any
vendor's capital award that is not used during any one year period may
be carried over into subsequent years ending before April first, two
thousand thirteen. Any amount attributable to a capital expenditure
approved prior to April first, two thousand thirteen and completed
before April first, two thousand fifteen shall be eligible to receive
the vendor's capital award. In the event that a vendor track's capital
expenditures, approved by the division prior to April first, two thou-
sand thirteen and completed prior to April first, two thousand fifteen,
exceed the vendor track's cumulative capital award during the five year
period ending April first, two thousand thirteen, the vendor shall
continue to receive the capital award after April first, two thousand
thirteen until such approved capital expenditures are paid to the vendor
track subject to any required co-investment. In no event shall any
vendor track OR VENDOR OFF-TRACK BETTING FACILITY that receives a vendor
fee pursuant to clause (F) or (G) of this subparagraph be eligible for a
vendor's capital award under this section. Any operator of a vendor
track OR VENDOR OFF-TRACK BETTING FACILITY which has received a vendor's
capital award, choosing to divest the capital improvement toward which
the award was applied, prior to the full depreciation of the capital
S. 6792 5
improvement in accordance with generally accepted accounting principles,
shall reimburse the state in amounts equal to the total of any such
awards. Any capital award not approved for a capital expenditure at a
video lottery gaming facility by April first, two thousand thirteen
shall be deposited into the state lottery fund for education aid; and
(I) Notwithstanding any provision of law to the contrary, free play
allowance credits authorized by the division pursuant to subdivision f
of section sixteen hundred seventeen-a of this article shall not be
included in the calculation of the total amount wagered on video lottery
games, the total amount wagered after payout of prizes, the vendor fees
payable to the operators of video lottery facilities, vendor's capital
awards, fees payable to the division's video lottery gaming equipment
contractors, or racing support payments.
S 3. Subparagraph (iii) of paragraph 1 and the opening paragraph of
paragraph 2 of subdivision b of section 1612 of the tax law, as amended
by section 1 of part O-1 of chapter 57 of the laws of 2009, are amended
to read as follows:
(iii) less an additional vendor's marketing allowance at a rate of ten
percent for the first one hundred million dollars annually and eight
percent thereafter of the total revenue wagered at the vendor track OR
VENDOR OFF-TRACK BETTING FACILITY after payout for prizes to be used by
the vendor track OR VENDOR OFF-TRACK BETTING FACILITY for the marketing
and promotion and associated costs of its video lottery gaming oper-
ations and pari-mutuel horse racing operations, as long as any such
costs associated with pari-mutuel horse racing operations simultaneously
encourage increased attendance at such vendor's video lottery gaming
facilities, consistent with the customary manner of marketing comparable
operations in the industry and subject to the overall supervision of the
division; provided, however, that the additional vendor's marketing
allowance shall not exceed eight percent in any year for any operator of
a racetrack located in the county of Westchester or Queens; provided,
however, a vendor track OR VENDOR OFF-TRACK BETTING FACILITY that
receives a vendor fee pursuant to clause (G) of subparagraph (ii) of
this paragraph shall not receive the additional vendor's marketing
allowance. In establishing the vendor fee, the division shall ensure the
maximum lottery support for education while also ensuring the effective
implementation of section sixteen hundred seventeen-a of this article
through the provision of reasonable reimbursements and compensation to
vendor tracks OR VENDOR OFF-TRACK BETTING FACILITIES for participation
in such program. Within twenty days after any award of lottery prizes,
the division shall pay into the state treasury, to the credit of the
state lottery fund, the balance of all moneys received from the sale of
all tickets for the lottery in which such prizes were awarded remaining
after provision for the payment of prizes as herein provided. Any reven-
ues derived from the sale of advertising on lottery tickets shall be
deposited in the state lottery fund.
As consideration for the operation of a video lottery gaming facility,
the division, shall cause the investment in the racing industry of a
portion of the vendor fee received pursuant to paragraph one of this
subdivision in the manner set forth in this subdivision. With the
exception of ANY VENDOR OFF-TRACK BETTING FACILITY AND Aqueduct race-
track, each such track shall dedicate a portion of its vendor fees,
received pursuant to clause (A), (B), (C), (D), (E), (F), or (G) of
subparagraph (ii) of paragraph one of this subdivision, solely for the
purpose of enhancing purses at such track, in an amount equal to eight
and three-quarters percent of the total revenue wagered at the vendor
S. 6792 6
track after pay out for prizes. In addition, with the exception of Aque-
duct racetrack, one and one-quarter percent of total revenue wagered at
the vendor track after pay out for prizes, received pursuant to clause
(A), (B), (C), (D), (E), (F), or (G) of subparagraph (ii) of paragraph
one of this subdivision, shall be distributed to the appropriate breed-
ing fund for the manner of racing conducted by such track.
S 4. Subdivision a of section 1617-a of the tax law, as amended by
section 2 of part O-1 of chapter 57 of the laws of 2009, is amended to
read as follows:
a. The division of the lottery is hereby authorized to license, pursu-
ant to rules and regulations to be promulgated by the division of the
lottery, the operation of video lottery gaming at (1) Aqueduct, Monti-
cello, Yonkers, Finger Lakes, and Vernon Downs racetracks, or at any
other racetrack licensed pursuant to article three of the racing, pari-
mutuel wagering and breeding law that are located in a county or coun-
ties in which video lottery gaming has been authorized pursuant to local
law, excluding the licensed racetrack commonly referred to in article
three of the racing, pari-mutuel wagering and breeding law as the "New
York state exposition" held in Onondaga county and the racetracks of the
non-profit racing association known as Belmont Park racetrack and the
Saratoga thoroughbred racetrack; AND (2) AT ONE REGIONAL OFF-TRACK
BETTING CORPORATION FACILITY LICENSED PURSUANT TO SECTION ONE THOUSAND
EIGHT OR ONE THOUSAND NINE OF THE RACING, PARI-MUTUEL WAGERING AND
BREEDING LAW WITHIN ANY REGION IN WHICH NO PARTICIPATING COUNTY CONTAINS
EITHER A THOROUGHBRED OR STANDARDBRED RACETRACK LICENSED TO OPERATE BY
THE RACING AND WAGERING BOARD. Such rules and regulations shall
provide, as a condition of licensure, that racetracks OR REGIONAL
OFF-TRACK BETTING CORPORATIONS, AS CREATED BY SECTION FIVE HUNDRED TWO
OF THE RACING, PARI-MUTUEL WAGERING AND BREEDING LAW, to be licensed are
certified to be in compliance with all state and local fire and safety
codes, that the division is afforded adequate space, infrastructure, and
amenities consistent with industry standards for such video gaming oper-
ations as found at racetracks in other states, that racetrack OR
REGIONAL OFF-TRACK BETTING CORPORATION employees involved in the opera-
tion of video lottery gaming pursuant to this section are licensed by
the racing and wagering board, and such other terms and conditions of
licensure as the division may establish. Notwithstanding any inconsist-
ent provision of law, video lottery gaming at a racetrack OR REGIONAL
OFF-TRACK BETTING CORPORATION pursuant to this section shall be deemed
an approved activity for such racetrack OR REGIONAL OFF-TRACK BETTING
CORPORATION under the relevant city, county, town, or village land use
or zoning ordinances, rules, or regulations. No entity licensed by the
division operating video lottery gaming pursuant to this section may
house such gaming activity in a structure deemed or approved by the
division as "temporary" for a duration of longer than eighteen-months.
Nothing in this section shall prohibit the division from licensing an
entity to operate video lottery gaming at an existing racetrack as
authorized in this subdivision whether or not a different entity is
licensed to conduct horse racing and pari-mutuel wagering at such race-
track pursuant to article two or three of the racing, pari-mutuel wager-
ing and breeding law.
The division, in consultation with the racing and wagering board,
shall establish standards for approval of the temporary and permanent
physical layout and construction of any facility or building devoted to
a video lottery gaming operation. In reviewing such application for the
construction or reconstruction of facilities related or devoted to the
S. 6792 7
operation or housing of video lottery gaming operations, the division,
in consultation with the racing and wagering board, shall ensure that
such facility:
(1) possesses superior consumer amenities and conveniences to encour-
age and attract the patronage of tourists and other visitors from across
the region, state, and nation.
(2) has adequate motor vehicle parking facilities to satisfy patron
requirements.
(3) has a physical layout and location that facilitates access to and
from the horse racing track portion of such facility to encourage patro-
nage of live horse racing events that are conducted at such track.
S 5. This act shall take effect the first of January next succeeding
the date on which it shall have become a law.