S T A T E O F N E W Y O R K
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6243--A
Cal. No. 1511
2017-2018 Regular Sessions
I N S E N A T E
May 11, 2017
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Introduced by Sens. BONACIC, GRIFFO, AKSHAR, FUNKE, VALESKY -- read
twice and ordered printed, and when printed to be committed to the
Committee on Racing, Gaming and Wagering -- reported favorably from
said committee and committed to the Committee on Finance -- committee
discharged and said bill committed to the Committee on Rules --
reported favorably from said committee, ordered to a third reading,
passed by Senate and delivered to the Assembly, recalled, vote recon-
sidered, restored to third reading, amended and ordered reprinted,
retaining its place in the order of third reading
AN ACT to amend the tax law, in relation to vendor fees for video
lottery gaming
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subparagraph (ii) of paragraph 1 of subdivision b of
section 1612 of the tax law, is amended by adding a new clause (F-1) to
read as follows:
(F-1) NOTWITHSTANDING CLAUSES (A), (B), (C), (D), (E) AND (F) OF THIS
SUBPARAGRAPH, WHEN THE VENDOR TRACK IS LOCATED WITHIN ONEIDA COUNTY, IS
WITHIN FIFTEEN MILES OF A NATIVE AMERICAN CLASS III GAMING FACILITY, AND
MAINTAINS AT LEAST NINETY PERCENT OF FULL TIME EQUIVALENT EMPLOYEES AS
THEY EMPLOYED IN THE YEAR TWO THOUSAND SIXTEEN, AS DETERMINED BY THE
GAMING COMMISSION, AT A RATE OF FIFTY-FIVE PERCENT FOR THE FIRST THIRTY
MILLION DOLLARS ANNUALLY, AND FORTY-ONE PERCENT THEREAFTER OF THE TOTAL
REVENUE WAGERED AT THE VENDOR TRACK AFTER PAYOUT FOR PRIZES PURSUANT TO
THIS CHAPTER;
§ 2. Clause (H) of subparagraph (ii) of paragraph (1) of subdivision b
of section 1612 of the tax law, as amended by section 1 of part QQ of
chapter 59 of the laws of 2017, is amended to read as follows:
(H) notwithstanding clauses (A), (B), (C), (D), (E), (F) and (G) of
this subparagraph, the track operator of a vendor track and in the case
of Aqueduct, the video lottery terminal facility operator, shall be
eligible for a vendor's capital award of up to four percent of the total
revenue wagered at the vendor track after payout for prizes pursuant to
this chapter, which shall be used exclusively for capital project
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11459-02-7
S. 6243--A 2
investments to improve the facilities of the vendor track 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 demonstrates that such capital expenditures
will increase patronage at such vendor track's 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 annual limit, provided, however, that any such capital award for
the Aqueduct video lottery terminal facility operator shall be one
percent of the total revenue wagered at the video lottery terminal
facility after payout for prizes pursuant to this chapter until the
earlier of the designation of one thousand video lottery devices as
hosted pursuant to paragraph four of subdivision a of section sixteen
hundred seventeen-a of this chapter or April first, two thousand nine-
teen and shall then be four percent of the total revenue wagered at the
video lottery terminal facility after payout for prizes pursuant to this
chapter, provided, further, that such capital award shall only be
provided pursuant to an agreement with the operator to construct an
expansion of the facility, hotel, and convention and exhibition space
requiring a minimum capital investment of three hundred million dollars.
Except for tracks having less than one thousand one hundred video gaming
machines, and except for a vendor track located west of State Route 14
from Sodus Point to the Pennsylvania border within New York, and except
for Aqueduct racetrack each track operator shall be required to co-in-
vest an amount of capital expenditure equal to its cumulative vendor's
capital award. For all tracks, except for Aqueduct racetrack, the amount
of any vendor's capital award that is not used during any one year peri-
od may be carried over into subsequent years ending before April first,
two thousand eighteen. Any amount attributable to a capital expenditure
approved prior to April first, two thousand eighteen and completed
before April first, two thousand twenty; or approved prior to April
first, two thousand twenty-two and completed before April first, two
thousand twenty-four for a vendor track located west of State Route 14
from Sodus Point to the Pennsylvania border within New York, 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 thousand eighteen and completed prior to April first,
two thousand twenty, exceed the vendor track's cumulative capital award
during the five year period ending April first, two thousand eighteen,
the vendor shall continue to receive the capital award after April
first, two thousand eighteen until such approved capital expenditures
are paid to the vendor track subject to any required co-investment. In
no event shall any vendor track that receives a vendor fee pursuant to
clause (F), (F-1) or (G) of this subparagraph be eligible for a vendor's
capital award under this section. Any operator of a vendor track which
has received a vendor's capital award, choosing to divest the capital
improvement toward which the award was applied, prior to the full depre-
ciation of the capital 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
S. 6243--A 3
expenditure at a video lottery gaming facility by April first, two thou-
sand eighteen shall be deposited into the state lottery fund for educa-
tion aid; and
§ 3. Subparagraph (ii) of paragraph 1 of subdivision b of section 1612
of the tax law, is amended by adding a new clause (J) to read as
follows:
(J) IN THE EVENT THAT THE OPERATOR OF A VENDOR TRACK WHO RECEIVES A
VENDOR FEE PURSUANT TO CLAUSE (F-1) OF THIS SUBPARAGRAPH HAS ANY REMAIN-
ING FUNDS IN THEIR VENDOR CAPITAL AWARD ACCOUNT, ANY CLAIM BY THE OPERA-
TOR OF THE VENDOR TRACK ON THESE FUNDS SHALL IMMEDIATELY BE FORFEITED,
AND THE FUNDS SHALL BE TRANSFERRED TO THE STATE LOTTERY FUND AS CREATED
BY SECTION NINETY-TWO-C OF THE STATE FINANCE LAW.
§ 4. Paragraph 2 of subdivision b of section 1612 of the tax law, as
amended by section 1 of part OO of chapter 59 of the laws of 2014, is
amended to read as follows:
2. As consideration for the operation of a video lottery gaming facil-
ity, 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 Aqueduct racetrack or a facility in the county of Nassau or
Suffolk operated by a corporation established pursuant to section five
hundred two of the racing, pari-mutuel wagering and breeding law, each
such track shall dedicate a portion of its vendor fees, received pursu-
ant to clause (A), (B), (C), (D), (E), (F), (F-1), or (G) of subpara-
graph (ii) of paragraph one of this subdivision, 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 track after
pay out for prizes. One percent of the gross purse enhancement amount,
as required by this subdivision, shall be paid to the gaming commission
to be used exclusively to promote and ensure equine health and safety in
New York. Any portion of such funding to the gaming commission unused
during a fiscal year shall be returned to the video lottery gaming oper-
ators on a pro rata basis in accordance with the amounts originally
contributed by each operator and shall be used for the purpose of
enhancing purses at such track. One and one-half percent of the gross
purse enhancement amount at a thoroughbred track, as required by this
subdivision, shall be paid to an account established pursuant to section
two hundred twenty-one-a of the racing, pari-mutuel wagering and breed-
ing law to be used exclusively to provide health insurance for jockeys.
In addition, with the exception of Aqueduct racetrack or a facility in
the county of Nassau or Suffolk operated by a corporation established
pursuant to section five hundred two of the racing, pari-mutuel wagering
and breeding law, 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), (F-1), or (G) of subparagraph (ii)
of paragraph one of this subdivision, shall be distributed to the appro-
priate breeding fund for the manner of racing conducted by such track.
Provided, further, that nothing in this paragraph shall prevent each
track from entering into an agreement, not to exceed five years, with
the organization authorized to represent its horsemen to increase or
decrease the portion of its vendor fee dedicated to enhancing purses at
such track during the years of participation by such track, or to race
fewer dates than required herein.
§ 5. This act shall take effect immediately.
