SENATE BILL 511
46th legislature - STATE OF NEW MEXICO - second session, 2004
INTRODUCED BY
Don Kidd
AN ACT
RELATING TO STATE REVENUE; PROVIDING THAT CERTAIN TAX REVENUES PAID BY CERTAIN RACETRACKS AND GAMING TAX REVENUES PAID BY CERTAIN GAMING OPERATOR LICENSEES THAT ARE RACETRACKS BE USED FOR GRADUATE STUDENT SCHOLARSHIPS; CREATING THE GRADUATE STUDENT SCHOLARSHIP FUND; MAKING AN APPROPRIATION.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. [NEW MATERIAL] GRADUATE STUDENT SCHOLARSHIP FUND--CREATED--SCHOLARSHIP PROGRAM.--
A. The "graduate student scholarship fund" is created in the state treasury. The fund shall be administered by the commission on higher education. Earnings from investment of the fund shall accrue to the credit of the fund and unexpended and unencumbered balances in the fund shall not revert to any other fund.
B. Money in the graduate student scholarship fund is appropriated to the commission on higher education for distribution to New Mexico's public post-secondary educational institutions with graduate schools for the purpose of providing scholarships to New Mexico residents pursuing advanced degrees at those schools.
C. The commission on higher education shall develop guidelines, procedures and qualifications for the application and award of the scholarships provided for in this section.
Section 2. A new section of the Tax Administration Act is enacted to read:
"[NEW MATERIAL] DISTRIBUTION--GRADUATE STUDENT SCHOLARSHIP FUND--CERTAIN GAMING TAX RECEIPTS.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the graduate student scholarship fund in the amount of the net receipts attributable to the gaming tax paid by those gaming operator licensees that are racetracks and located in a class B county with a population, as shown by the most recent federal decennial census, of greater than fifty thousand and less than eighty thousand and with a net taxable value for property tax purposes of greater than one million dollars ($1,000,000)."
Section 3. Section 60-1-8 NMSA 1978 (being Laws 1933, Chapter 55, Section 4, as amended by Laws 1991, Chapter 7, Section 2 and by Laws 1991, Chapter 195, Section 1) is amended to read:
"60-1-8. TIME FOR FILING APPLICATION--AMOUNT OF DAILY TAX.--
A. Application shall be filed not less than sixty days prior to the first day the proposed races or meetings are to be held, and at the time pari-mutuel wagering is conducted, the applicant shall pay to the state racing commission the daily tax provided by this section.
B. The daily tax to be paid whenever the licensee offers pari-mutuel wagering on live on-track races shall be:
(1) for a class A license, six hundred fifty dollars ($650) for each racing day authorized by the state racing commission; and
(2) for a class B license, one-eighth [of one] percent of a class B licensee's gross daily handle, up to a maximum of three hundred dollars ($300), for each racing day authorized by the state racing commission for class B licenses.
C. Except as provided in Section 60-1-27 NMSA 1978, the daily tax provided in Subsection B of this section shall go to the credit of the general fund; provided, however, that for a class A license located in an incorporated municipality with a population, according to the 1990 federal decennial census, that is either:
(1) less than six thousand persons if located in a county with a population of more than ten thousand but less than fifteen thousand persons; or
(2) more than eight thousand but less than ten thousand persons if located in a county with a population of more than one hundred thousand but less than one hundred fifty thousand persons; then one hundred fifty dollars ($150) of the daily tax paid by those class A licensees that qualify under Paragraphs (1) and (2) of this subsection shall be paid to the municipality in which each licensee is located.
D. The daily tax to be paid whenever the licensee offers no pari-mutuel wagering on live on-track races and offers solely pari-mutuel wagering on simulcast races pursuant to Section 60-1-25 NMSA 1978 shall be one-eighth [of one] percent of the licensee's gross daily handle, up to a maximum of three hundred dollars ($300), for each racing day authorized by the state racing commission.
E. The daily tax for any state fair association designated by law, which in good faith conducts a public fair and exhibition of stock and farming products, shall be six hundred fifty dollars ($650) per day for each racing day authorized; provided, however, that where a licensed state fair association offers no pari-mutuel wagering on live on-track races and offers solely pari-mutuel wagering on simulcast races pursuant to Section 60-1-25 NMSA 1978, the daily tax shall be one-eighth [of one] percent of the licensee's gross daily handle, up to a maximum of three hundred dollars ($300)."
Section 4. Section 60-1-10 NMSA 1978 (being Laws 1933, Chapter 55, Section 6, as amended) is amended to read:
"60-1-10. PARI-MUTUEL METHOD LEGALIZED--MAXIMUM COMMISSIONS--HORSEMEN'S COMMISSION--GAMBLING STATUTES NOT REPEALED--COMMISSION DISTRIBUTION.--
A. Within the enclosure where any horse races are conducted, either as live on-track horse races or as horse races simulcast pursuant to Section 60-1-25 NMSA 1978, and where the licensee has been licensed to use the pari-mutuel method or system of wagering on races, the pari-mutuel system is lawful, but only within the enclosure where races are conducted.
B. The sale to patrons present on the grounds of pari-mutuel tickets or certificates on the races or the use of the pari-mutuel system shall not be construed to be betting, gambling or pool selling and is authorized under the conditions provided by law.
C. There shall be for each class A licensee a commission of nineteen percent of the gross amount wagered on win, place and show through the pari-mutuel system, of which eighteen and three-fourths percent shall be retained by a class A licensee and, except as provided in Section 60-1-27 NMSA 1978, one-fourth [of one] percent shall be allocated to the general fund. A commission in an amount determined by the licensee of not less than eighteen and six-eighths percent and not greater than twenty-five percent of the gross amount wagered on win, place and show through the pari-mutuel system shall be retained by a class B licensee. Each class B licensee shall advise the state racing commission not less than thirty days in advance of each horse racing meeting of the percentage the licensee shall retain as commission. From that commission, each class A and class B licensee shall allocate five-eighths [of one] percent to the New Mexico horse breeders' association weekly for distribution pursuant to the provisions of Subsection C of Section 60-1-17 NMSA 1978.
D. Except as otherwise provided in this subsection, a commission shall be retained by the licensee at the election of each class A licensee of not less than twenty-one percent and not greater than twenty-five percent of the gross amount wagered on exotic wagering and at the election of each class B licensee, and with the approval of the state racing commission, of not less than twenty-one percent and not greater than thirty percent of the gross amount wagered on exotic wagering. For the purpose of this subsection, "exotic wagering" means all wagering, other than win, place and show, through the pari-mutuel system. Each licensee shall advise the state racing commission not less than thirty days in advance of each horse racing meeting of the amount of the commission of the gross amount wagered on exotic wagering to be retained by the licensee. From that commission, the licensee shall allocate one and three-eighths percent to the New Mexico horse breeders' association weekly for distribution pursuant to the provisions of Subsection C of Section 60-1-17 NMSA 1978.
E. The odd cents of all redistributions to the wagerer over the next lowest multiple of ten from the gross amount wagered through the pari-mutuel system shall be retained by the licensee, with fifty percent of the total being allocated to enhance the race purses of established stake races that include only horses registered as New Mexico bred with the New Mexico horse breeders' association, to be distributed by the New Mexico horse breeders' association pursuant to Paragraph (3) of Subsection C of Section 60-1-17 NMSA 1978 subject to the approval of the state racing commission.
F. All money resulting from the failure of patrons who purchased winning pari-mutuel tickets during the meeting to redeem their winning tickets before the end of the sixty-day period immediately succeeding the closing day of the meeting and all money resulting from the failure of patrons who purchased pari-mutuel tickets that were entitled to refund but were not refunded during the same sixty-day period shall be apportioned as follows:
(1) thirty-three and thirty-three hundredths percent shall be retained by the licensee;
(2) thirty-three and thirty-four hundredths percent shall be distributed to the New Mexico horse breeders' association to enhance each track's established overnight purses for races that include only horses registered as New Mexico bred with the New Mexico horse breeders' association pursuant to Paragraph (3) of Subsection C of Section 60-1-17 NMSA 1978, subject to the approval of the state racing commission; and
(3) thirty-three and thirty-three hundredths percent shall be allocated to [horseman's] horsemen's race purses.
G. To promote and improve the quality of horse racing and simulcasting and the participation of interested persons in horse racing in New Mexico, one-half [of one] percent of the gross amount wagered on simulcast horse races at each licensed racetrack in New Mexico that receives simulcast horse races shall be allocated by each licensee for distribution to the New Mexico horsemen's association; provided that at least [one-quarter of one] one-fourth percent of the gross amount wagered on simulcast races that is so allocated is used solely for medical benefits for the members of the New Mexico horsemen's association, and provided further that the remaining [one-quarter of one] one-fourth percent of the gross amount wagered on simulcast races that is so allocated shall be used to enhance purses at each such licensed racetrack. The state racing commission shall by regulation provide for the timing and manner of the distribution required by this subsection and shall audit, or arrange for an independent audit of, the disbursement required by this subsection.
H. Fifty percent of the net retainage of each licensee shall be allocated to race purses. For purposes of this section, "net retainage" of the licensee means the commission retained by the licensee on all forms of wagers minus:
(1) the taxes delineated in Sections 60-1-8 and 60-1-15 NMSA 1978;
(2) money allocated to the New Mexico horse breeders' association by this section and Section 60-1-17 NMSA 1978;
(3) money allocated to the New Mexico horsemen's association by this section;
(4) a deduction for expenses incurred to engage in intrastate simulcasting pursuant to Section
60-1-25 NMSA 1978, provided that:
(a) the deduction for each licensee shall be a portion of five percent of the gross amount wagered at all the sites receiving the same simulcast horse races;
(b) the deduction portion for each licensee shall be an amount allocated to the licensee by agreement voluntarily reached among all the licensees sending or receiving the same simulcast horse races; and
(c) the deduction portion for each licensee shall be an amount allocated to the licensee by the state racing commission if all the licensees sending or receiving the same simulcast horse races fail to reach a voluntary agreement under Subparagraph (b) of this paragraph; and
(5) a deduction for fees and commissions incurred to receive interstate simulcasts pursuant to Section 60-1-25 NMSA 1978.
I. Existing statutes of this state against horse racing on Sundays or on bookmaking, pool selling or other methods of wagering on the racing of horses are not repealed but are hereby expressly continued in effect, with the exception that the operation of the pari-mutuel method or system in connection with the racing of horses, when used as provided by law, is lawful.
J. In the event any money paid or allocated to the New Mexico horse breeders' association or the New Mexico Appaloosa racing association pursuant to the Horse Racing Act cannot be paid to or allocated or administered by such associations, then the state racing commission, or such other organization as may be designated, retained or absolutely controlled by the state racing commission, shall receive all such money and shall pay, allocate and administer all such money pursuant to the provisions of Section 60-1-17 NMSA 1978. If the state racing commission or its controlled designee is required to pay, allocate or administer money on behalf of the New Mexico horse breeders' association or the New Mexico Appaloosa racing association pursuant to this subsection, then the maximum percentage of funds set forth in Paragraph (3) of Subsection C of Section 60-1-17 NMSA 1978 shall be paid by the state racing commission to the New Mexico horse breeders' association or the New Mexico Appaloosa racing association as a fee to obtain the certification of the registry of the dam and stud of the New Mexico bred horse.
K. In the event any money paid or allocated to the New Mexico horsemen's association pursuant to the Horse Racing Act cannot be paid to or allocated or administered by the association, then the state racing commission, or such other organization as may be designated, retained or absolutely controlled by the state racing commission, shall receive all such money and shall pay, allocate and administer all such money to achieve the purposes of the provisions of this section."
Section 5. Section 60-1-15 NMSA 1978 (being Laws 1933, Chapter 55, Section 9, as amended) is amended to read:
"60-1-15. TAX LEVIED--CERTAIN LICENSE FEES AND TAXES
PROHIBITED.--
A. In addition to the daily tax provided in Section 60-1-8 NMSA 1978, a tax of two and three-sixteenths percent is levied on the gross amount wagered each day at each place where horse racing is conducted by any state fair association designated by law that in good faith conducts a public fair and exhibition of stock and farming products or where horse racing for profit is held. The tax shall be paid from the commissions of the licensee.
B. To encourage the improvement of horse racing facilities for the benefit of the public, breeders and horse owners and to increase the revenue to the state from the increase in pari-mutuel wagering and tourism resulting from these improvements, not more than two percent of the tax levied under Subsection A of this section:
(1) for the first two hundred fifty thousand dollars ($250,000) of daily handle only, shall be offset for class A licensees by the amount that each licensee expends for capital improvements or in financing term investment in capital improvements at existing racetrack facilities and for class B licensees by the amount that the licensee expends for capital improvements, not to exceed fifty percent of the tax levied under this section, and by the amount the licensee expends for advertising, marketing and promoting horse racing in the state, not to exceed fifty percent of the tax levied under this section. The offset provided in this paragraph shall also apply to the daily handle generated at its facility by a licensee engaged solely in simulcasting pursuant to Section 60-1-25 NMSA 1978. The term "capital improvement" means any capital investment in items that are subject to depreciation under the United States Internal Revenue Code of 1986 and are approved by the state racing commission; and
(2) for class A licensees for the period through June 30, 1995 for the total amount wagered each day on amounts in excess of two hundred fifty thousand dollars ($250,000) but not in excess of three hundred fifty thousand dollars ($350,000), shall be offset by the amount that each licensee expends for advertising, marketing and promoting horse racing in the state. The offset provided in this paragraph shall also apply to the daily handle generated at its facility by a licensee engaged solely in simulcasting pursuant to Section 60-1-25 NMSA 1978. The licensee is required to keep accurate records of any expenditures made pursuant to this paragraph, and the state auditor is required to audit the expenditures and submit his report to the state racing commission.
C. To compensate for the additional municipal services required by the location of a racetrack within a municipality, an amount of revenue derived from the tax levied on such a racetrack under Subsection A of this section, above the amount offset by capital expenditures and advertising as provided in Subsection B of this section, shall be transferred to the municipal treasurer of the municipality in which the track generating the revenue is located for expenditure by the municipality in providing those additional municipal services. The amount to be transferred shall be determined in accordance with the provisions of Section 60-1-15.2 NMSA 1978.
D. Accurate records shall be kept by the licensee to show all commissions, total gross amounts wagered and breakage, as well as other information the state racing commission may require. Records shall be open to inspection and shall be audited by the commission or any of its authorized representatives. Should any licensee fail to keep records accurately and intelligibly, the commission may prescribe the method in which the licensee shall keep records.
E. Except as provided in Section 60-1-27 NMSA 1978, all remaining revenues collected as a result of the tax on the gross amount wagered shall be deposited in the state general fund.
F. Notwithstanding any other provision of law, no political subdivision of this state may impose any occupational tax against a racetrack operating under authority of a license granted by the state racing commission. No political subdivision may levy an excise tax against any racetrack operating under authority of a license granted by the state racing commission, except that taxes imposed pursuant to [the County Gross Receipts Tax Act, the County Fire Protection Excise Tax Act, the County Sales Tax Act, the Municipal Gross Receipts Tax Act, the Supplemental Municipal Gross Receipts Tax Act and the Special Municipal Gross Receipts Tax Act] a local option gross receipts tax, as defined in Subsection H of Section 7-1-3 NMSA 1978, may be imposed to the extent permitted by law."
Section 6. Section 60-1-16 NMSA 1978 (being Laws 1933, Chapter 55, Section 10, as amended) is amended to read:
"60-1-16. SUSPENSE FUND TO PAY CLAIMS.--From the funds derived from license fees and taxes, the state racing commission is authorized to create a special suspense fund with the state treasurer [of the state] in an amount not to exceed three thousand dollars ($3,000) to pay all legal claims for refunds. Except as provided in Section 60-1-27 NMSA 1978, any surplus over and above the maximum suspense fund amount shall be deposited into the general fund [of the state]."
Section 7. A new section of the Horse Racing Act, Section 60-1-27 NMSA 1978, is enacted to read:
"60-1-27. [NEW MATERIAL] REVENUE DISTRIBUTION--GRADUATE STUDENT SCHOLARSHIP FUND.--In lieu of the transfer otherwise required by Section 60-1-16 NMSA 1978, receipts from the following taxes, paid by a racetrack located in a class B county with a population, as shown by the most recent federal decennial census, of greater than fifty thousand and less than eighty thousand and with a net taxable value for property tax purposes of greater than one million dollars ($1,000,000), shall be distributed to the graduate student scholarship fund:
A. the daily tax imposed by Section 60-1-8 NMSA 1978;
B. one-fourth percent of the gross amount wagered on win, place and show and received as commission by a class A licensee pursuant to Subsection C of Section 60-1-10 NMSA 1978; and
C. the tax on gross amount wagered imposed by Section 60-1-15 NMSA 1978."
Section 8. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2004.
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