G en. 25] 25
RACI NG
B UD GE T ARY A DMI NI ST RA T I ON

– A DMINI STRATI V E L A W

– D E L E GAT I ON AND S UB DE L E GAT I ON

– M ARYL AN D R AC I NG C O M M ISSI ON M AY D E L EGATE M I NI STE RI AL D UTI ES R E L AT E D T O A DMI NI ST RA T I ON OF B RE D F UN DS

Februar y10, 2003

J. Mi chael

H opki ns A ct i ng E xec ut i ve D i r ect or
Pr om pt ed byques t i ons fr om the Legi s l at ive A u di t or , y our pr e d e c e s s o r a s k e d f

o r o u r o p i n i o n a b o u t t h e e x t e n t t o whi ch t he M a ry lan d R a c in g C o m m iss io n (th e “ C o m m iss io n ” ) m a yd e leg a te adm i nis t rat i on of tw o f

u n d s est abli shed u nd er the M ary l and H orse R aci n g A ct. W i t h r es pectt o admi ni s t r at i on of t he M ar y l and- B r ed Ra c e Fu n d , whi c h s u b s i d i z e s r a c e s a n d r e l a t e d a war d s i n v o l vi ng t hor oughbr ed hor s es br ed i n M a ry l a n d , th e Commi s s i on has as s i gned cer t ai n funct i ons t o t he M ar y l and H or s e B r eede r s A s s oci at i on, I nc. ( “M H B A ”)

. W i t h r es pect t o t he M ar y l and St andar dbr ed R ace Fund, w hi ch s ubs i di zes r ace s and r el at ed aw ard s i nvol vi ng s t andar dbr ed hor s es br ed i n M ar y l and, t he C om m i s s i on has as s i gned s i m i l ar funct i ons t o an admi ni s t r at or – a s t aff pos i t i on t hatt he C om m i s s i on has cr eat ed byr egul at i on. For t he r eas ons s t at ed bel ow , i ti s ouropi ni on t hatthe Commi s s i o n ma yd e l e g a t e a d mi n i s t r a t i v e a n d mi n i s t e r i a l d u t i es r el a t e d t o t h e M a r y l a n d

- Br e d Ra c e Fu n d t o t h e M HB A, i n l i ght of funct i ons as s i gned t o t hatent i t y by t he Legi s l atur e. T he del egat i on of s i m i l ar dut i es w i t h r es pect t o t he M ar y l and St andar dbr ed R ace F un d to an ad m i nis t rat o r e m p l oy ed b yt he C om m i ssi on i s al so p e rm iss ib le. In e ith e r i n sta n c e , th e C o m m iss io n m a y n o t d e le g a te di s cr et i onar yfunct i ons s peci fi cal l yas s i gned t o t he C om m i s s i on by st at ute. F or exam ple, t he M H B A and t he adm i nis t rat or m aydev i se schedu l es of races s ub si dize d byt he respect i ve fu nd s, bu tt ho se sc h e d u les a re su b

jec t to th e C o m m iss io n ’s a p p ro v a l.2 6 [8 8 O p
. A tt ’y

In particula

r, the trac ks are require d to allocate to th e F und 1 designated pe rce ntag es of the “brea kag e” a nd “take out” from e ach parimutuel pool. BR §§11-515, 11- 525(d). A parimutuel pool consis ts of the total amount wag ere d on a ra ce. Th e “ take out”is thepa

rt of thepa ri mut ue l po ol n ot re tur

ne d to be tto rs
. The “bre akag e” is the c umulative amount remaining a fter thewinnings of succe ssful bettors arerounded down to the next l owe s t multi ple of 10 cents. B R §11-101(b), ( e), ( l), (u)

. Un de r B R §1 1- 80 4, thebr e akag e and take out deri ve d f ro m be ts 2 ma deon out- of -s tatera c e s area llo c ate d “ in a wa y no rm a lly a

pp lic a bleto pari mutu el betting on racingthe license e holds.” Unde r B R §11-804.1, pa y me nts re c e ive d by a Ma

ry land tr a c k with re sp e c t to sim ulc a sti ngof

its rac es to other jurisdictions are allocate d to various purposes, including the applicableBred F und, pursuant to an agree ment between the trac k and o th e r c o mp o n e nt s o f

th e r a c i n gi n d

u s tr y. I
The Bre d Funds
T h e G e n e ra l A ss e m b ly h a s c re a ted tw o f u n d s (c o llec tiv e ly r efe r r ed t o as t he “Bre d Funds” ) u n d er the aus pi ces of t he C om m i s s i on t o pr om ot e, r es pect i vel y , t he t hor oughbr ed and s ta n d a rd b re d (h a rn e s s ) i n d u s tr ie s in th e S ta te

. A. Mar

y land

-Bre d Rac e Fund
T he M ar y l and- B r ed R ace Fund w as cr eat ed i n 1962. C hapt er 1 3 7 , L a w s o f

M a ryla n d 1 9 6 2 , now codi f i ed at A nnotat ed C ode of M ar y l and, B us i nes s R egul at i on A r t i cl e ( “B R ”) , §§11- 529 t hr ough 1 1 -5 4 1

. E a c h th o ro u g h b re d tra c k in M a ry lan d m u st a llo c a te c e rta in per cent ages of t he par i m utuel pool s for i t s r ace s t o t he Fund. T he 1 F u n d m a ya ls o re c e iv e m o n e yf ro m o th e r s o u rc e s
. S ee , e.g ., BR § § 1 1 -80 4 (pa y m en ts de ri v ed fro m b ets m ad e o n o u t- o f-state rac es); 11- 804. 1 ( paym ent s r ece ived w i t h r es pectt o t he s i m ul cas t i ng of stan d ard b red rac es in M ary land to o ther jurisdicti o n s). 2
T he M ar y l and- B r ed R ace Fund pr ovi des fi nanci al s uppor tfor th e “ M a ry lan d -B re d R a c e P ro g ra m ,” a se rie s o f ra c e s in w h ich o n lyG en. 25] 27

In addition, up to 5% of the Fund may be devote d to special ra ces 3 for horses conce ived, but not nece ssarily foale d ( i.e. , born), in Maryland. BR §11-535( d).
In order to qualify for reg istration a horse must havebeen f oaled 4 in Maryland and

one of thefollowingcriteria must be satisfied: (1) the bre eder of the hor se has maintaine d a place o f abodein Maryland for more than nine months immediately

before re g istration; (2) the breed er of the horse keeps breeding stock continually

in Maryland; (3) the horse was co n ce i v edi n Mary land duringthe pre vious [ bree ding] season; or ( 4 ) th e ho rse ’s [ mo th er] was sent to Maryland to foal a

nd afte r foaling, [attempts were made to impre gnate the mother] by a Mary land stallion during the se ason of the hor se’s birth. BR §11-538. A ccording to its website, the MH BAcharg es a feerang ing from $50 to $300 for reg istration. See<www. mdh or sebr e e de rs .c om/Md BdF n.cfm>

. t hor o u g h b r e d h o r s e s b r e d i n M a r y l a n d ma yp a r t i c i p a t e
. E ach 3 tho rou g h b red tr ac k is t o p rov ide f o r th e run n ing o f su ch rac es a s p art of thatprogram
. B R §1 1-536

. In o rdert o b e el i gibl e for t ho se r aces, a h o r s e mu s tb e r e g i s t e r e d w i t h t h e M HBA, a p r i v a t e e n t i t y
. BR § 1 1 -53 7

. T h e c ri teri a f o r suc h reg istrati o n w ith th e M H B A are es t abl i s hed bys t atut e. B R §11- 53 8

. A n ow nerorbr eede r 4 aggr i eved byan M H B A deci s i on not t o r egi s t er a hor s e mayappea l th a t d e c is io n to th e C o m m is s io n . C O M A R 0 9 .1 0 .0 1 .4 9 B

. B. Mar

y land Standar db r e d Rac e Fund
T he M ar y land St andar dbr ed R ace Fund ( t he “St andar dbr ed F u n d ”), a s i m i l arfund forhar nes s r aci ng, w as cr eat ed i n 1971. C h a p te r 7 7 1 , L a w s o f

M a ryla n d 1 9 7 1 , now codi f i ed at B R §§11- 623 thro u g h 1 1 -63 6

. L ike th e tho rou g h b red tr ac k s , h arn ess trac k s are r equi r ed t o for w ar d t o t he Fund des i gnat ed per cent ages of t he t a k e o u ta n d t h e b r e a k a g e f r o m e a c h p a r i mutu e l p o o l

. BR §§11- 613( a) ( 2) ( i ) , 11- 615( a) , 11- 617( b)

. A l s o, l ike the M ar y l and- B r ed R ace Fund, t he St andar dbr ed Fund mayr ece i ve moni es fr om ot her s o u rc e s , a s w e ll. See B R §11- 403( a) ( 8) ( di s t r i but i ons fr om Speci al F u n d c o n sis tin g o f

v a rio u s f

e e s a n d tax e s); B R § 1 1 -8 0 4 (p a y m e n ts2 8 [8 8 O p
. A tt ’y

Th e ho rs e ’s sire mus t ha vebe e n at st

ud in M aryland

fo r a fu ll 5 bree ding se ason, and theoffspring must have been conceive d duringthat season. B R§11-633(2)- (3).

Th e Mary land -B re d Ra c e F un d Ad vis or y Committee consis ts 6 of fiv e m ember s appointed by the Commiss ion with the approva l of the Se c re tary of L a

bo r, L ic e ns ing and Re gulatio n. On e of theme mbers mus t also b e a member of the Commission. The other four members of

the Advisory Commi ttee are to be a ppoi n t ed o n the re commendation of rac ing- related entities: two must be rec ommended by and be members of (continued...) d e ri v e d f

ro m b e ts m a d e o n o u t- o f

- s t a te ra c e s ); B R § 1 1 -8 0 4 .1 ( paym ent s r ece i ved w i t h r es pectt o t he s i m ul cas t i ng of s t andar dbr ed rac es in M ary land to o ther jurisdicti o n s).
T h e S t a n d a r d b r e d Fu n d p r o v i d e s f i n a n c i a l s u p p o r tf

o rt wo r aci ng pr ogr ams t hati ncl ude r ace s run ateac h of t he harnes s t r acks i n the Stat e. B R § 1 1 -6 3 1 . Fi rs t , t he F oaled Stakes Prog ram i s a se rie s o f ra c e s in w h ich o n lysta n d a rd b re d h o rse s f o a led (b o rn ) in M ary l and m aycom pete. T o be el i gibl e for t ho se r aces, a ho rs e m ust b e re g ist ere d w ith the M ary land S tand ard b red R ac e F u n d A d v isory C om m i t t ee, an ent i t y cr eat ed bys t atut e. B R §§11- 625, 11- 632. T he s t atut or yr egi s t r at i on cr i t er i a ar e s i m i l art o t hos e fort he M ar y l andB re d R a c e F u n d . B R § 1 1 -6 3 2

. A n o w n e r o r b re e d e r m a ya p p e a l to th e C o m m iss io n f

ro m a re f

u sa l o f th e A d v is o ryC o m m itt e e to re g is te r a h o rs e . C O M A R 0 9 .1 0 .0 2 .4 3 D

. Second, t he Si r es St akes Pr ogr am i s a s er i es of r ace s i n w hi ch onl ys t andar dbr ed hor s es s i r ed by M ar y l and s t al l i ons m ay p arti cipa te. F o r a h o rse to b e eli g ible fo r th o se rac es, t h e h o rse’s sire ( fat h er) m u s tbe r egi s t er ed w i t h bot h t he A dvi s or yC om m i t t ee a nd th e U n ited S tate s T ro tti n g A ss o c iatio n , an d c e r ta in o th e r c riter ia m us tbe s at i s fi ed. B R §11 -63 3

. A deni al of r egi s t r at i on byt he 5 Ad v i s o r y Co mm i t t e e ma yb e a p p e a l e d t o t h e Co mm i s s i o n
. CO M AR 0 9 .1 0 .0 2 .5 3 H

. C
. A dm inis tr ati on of

the B r ed F unds
T h e L e g isla tu re h a s c h a r g e d th e C o m m iss io n w ith ad m inist ering the B red F u n d s. B R § § 1 1 -53 5 (a )( 1 ), 11 -62 9 (a)(1). W ith re sp e c t to e a c h f

u n d , th e C o m m iss io n is t o re lyo n th e “ h e lp and advi ce” of an A dvi s or y C om m i t t ee cons i s t i ng of r epr es ent at i ves f ro m v a ri o u s s e g m e n ts o f th e p e rt in e n t r a c in g in d u s tr y
. I d. T he 6G en. 25] 29

(...continued) 6 the MHB A; one must be re commended by the mile thoroughbred tra ck licensee s, and one must be recommende d by the M ary land S tate F air a

nd Agricultural Society , Inc. (Timonium). B R §11-532. Th e Mary land Stand ard

br e d Ra c e F un d A dv iso ry

Committe e is also appointed by the Commi ssion with the approval of the Secre tary of L abor, L icensingand Regulation. One of themembers is to be nomi nated by the Chairman of theCommi ssion and be a me mber of the Commi ssion. One member is to be nominated by the Chairman to repre sent a harne ss rac ing li c e n s e e
. T w o me mb e r s ar e to b e n o mi n ate d b y th e o rg an iz ation representinga majority of the standa rdbre d bree ders in the State (with one bei n ga “ c o mm e r c ial b r e e d e r ” )

. O n e memb e r is to b e n o mi n ate d

b y the Cloverleaf Standardbre d Owner s Association, Inc. (a group represe nting a majority of the standa

rdbre d owner s and traine rs i n the State). B R §11- 626. In eac h ca s e, the member of the Commission who serves on an Adv is ory Co mm ittee is th e cha irmanof thatAdv is ory Co mm ittee . BR §11-533; BR §11-627.
In addition to thesec o n ditio ns, with respec t to St andardbred F und 7 rac es, the Commission also i s to set the nomination and regi s tra t i on proce dures f

or horse s, ag ain o n the re commendation of theAdvisory Commi ttee. B R §11-634(b)( 6). C om m i s s i on i s t o depos i t w i t h a bank ortrus tcompanyt he moni es all ocat ed t o t he B r ed Funds , and t o ens ur e t hatt hos e funds are s ecur ed bycol l at er al

. B R §§11- 535( b) , 11- 629( b)

. Pay m ent s m ay be made fr om t he B r ed Funds onl y upon or derof t he C om m i s s i on. B R § § 1 1 -5 3 5 (a )( 2 ), 1 1 -6 2 9 (a )( 2 ).
O n the re co m m en d ati o n o f th e re sp ec ti v e A d v isory C om m i t t ees , t he C om m i s s i on i s t o s ett he p ara m et er s fort he r ace pr ogr ams s uppor t ed by t he B r ed Funds – i.e ., th e C o m m iss io n is to det er m i ne t he numb er o f r ace s i n eac h pr ogr am and, foreac h r ace , t he amount of t he pur s e, t he dat e of the r ace , t he d ist an ce, and t he amount of t he br eede r ’ s aw ar ds

. B R §§11- 539( a) ( 1)

- ( 5) , 1 1- 634( b) ( 1)

- ( 5)

. I n ad di t i on, t he C om m i s s i on i s t o s et“anyot her con dit i on necessaryt o carr you tt he p urpose” o f t he B red Fu nd races
. B R § § 1 1 -53 9 (a)(6), 11 -63 4 (b)(7 ). 7
W e under s t and t hatt he C om m i s s i on r el ie s on t he M H B A for admi ni s t r at i on of t he pr ogr ams s uppor t ed byt he M ar y l and- B r ed R a c e F u n d . In p a rticu lar , t h e C o m m iss io n lo o k s to th e M H B A to ens ur e t hat reg is t er ed t hor oughbr eds m eett he r equi r ement s for M ar y l and- br ed hor s es ; t o over s ee the depos i tof m oni es i nt o t he3 0 [8 8 O p
. A tt ’y

Monie s a ll o c ate d

to th e St an d ar d

b r e d F un d b y h ar n e s s tra ck 8 licenseearedeposited into an ac count in the names o f the Standardbred Fund a nd the Commiss ion (using theCommi ssion’s taxidentification number). The Commissi on conducts a n acc ounting of

these deposits at the end of the cale ndar year
. A re conciliation is then made reg ardingany overpa y ment or under

pay ment by the trac ks to the Fund. Fund’ s bank ac count ; t o cal cul at e and di s t r i but e aw ar ds fr om t he F u n d ; to m a in tain re c o rd s o f p a ym e n ts f

ro m th e F u n d ; an d to c o o r d i n a t e t h e r a c e s c h e d u l e f o r t h e M a r y l a n d

- Br e d Ra c e P r o g r a m. Per t i nentt o t he func t i ons per for m ed by t he M H B A , t he C om m i s s i on has adopt ed a r egul at i on t hat gover ns t he day

- t o- dayadmi ni s t r at i on of t he M ar y l and- B r ed R ace Fund. T hatr egul at i on det ai l s t he al l ocat i on of t he Fund t o r ace pur s es , ow ner ’ s aw ar ds , br eede rand s t al l i on aw ar ds , and ot herpurpos es r el ated t o M ar y l and- br ed th o ro u g h b re d s . C O M A R 0 9 .1 0 .0 1 .4 9 A , C , F -P

. U ndert hatr egul at i on, t he M H B A r ece i ves 5% of al l m oni es al l ocat ed t o t he M ar y l and- B red Race Fund, aft ert he deduc t i on of pr es cr i bed amount s , as compensa t i on foradmi ni s tr at i on of t he Fund. C O M A R 09. 10. 01. 49D

. T he r egul at i on also r equi r es t hatt he M H B A r endera s at i s fac t or yacco unt i ng t o t he C om m i s s i on of m o n ie s it r e c e iv e s . C O M A R 0 9 .1 0 .0 1 .4 9 E

. W i t h r es pectt o t he S t andar dbr ed Fund, t he C om m i s s i on has ado pted r egu l at i on s gov ernin g regi st rat i on of st and ardbred ho rs es, fort he Foal ed St akes and Si r ed St akes pr ogr ams, el i gi bi l i t yof hor s es t o s t ar ti n Fund r ace s , t he amount and di s t r i bu ti o n of pur s es and br eede raw ar ds , and re l at ed m at t er s
. C O M A R 09. 10. 02. 43,

. 53. T he r egul at i ons al s o pr ovi de for t he appoi nt m ent by t he C om m i s s i on of an admi ni s t r at or t o s uper vi s e t he dai l yoper at i on of t he St andar dbr ed Fund. C O M A R 09. 10. 02. 54- 1. T he admi ni s t r at ori s t o be s el ect ed byt he A dvi s or yC om m i tt ee , b u ts er ves att he pl eas ur e of the C o m m issi o n , w h ic h a ls o d e te rm ines the a d m inist rator’s c o m p e n s a tio n a n d b e n e f its

. Id

. C ur r ent l y , t he admi ni s t r at orw or ks fr om an offi ce atR os ecr oft R ace w ayw her e s he over s ees the col l ect i on of r evenue due t he S tan d a rd b re d F u n d , v e rif ies e lig ib ili tyo f

p a rtic ip a n ts in 8 S t and ardbred F un d races, gen erat es l i st s of el i gibl e ho rs es, s uper vi s es cer t ai n as pect s of t he r ace s , and ca l cul at es and di s t r i but es a w a rd s f ro m th e F u n d . In a d d iti o n , th e a d m in istra to r in sp e c ts M ar y l and br eedi ng farm s and t hei rhor s es and per for m s ot herdut i esG en. 25] 31

Strictly speaking , the term “dele g ation” ty pically ref

ers to a grant 9 of authority

by a leg islature to an a dministrative ag ency
. See, e .g. , Christ v. De partment of Natural

Resour ces , 335 Md. 427, 445, 644 A.2d 34 (1994). In this opini on, we use that term to re fer to the subdeleg ation of authority by the administrative ag ency to an entity

or an e mployee. t o ens ur e t hat hor s es bei ng r egi s t er ed t o par t i ci pat e i n St andar dbr ed F u n d rac es s a tis f y th e s ta tu to ry c ri te ri a
. See < w w w
. m s r fonl i ne. com/ pages / A bout_M SR F. ht m > (St andar dbr ed F u n d w eb sit e).
D
. L e g isla tive A u dit
D ur i ng a r ece ntaudi tof t he C om m i s s i on, t he Legi s l at i ve A u d ito r q u e stio n e d w h e th e r th e C o m m iss io n h a d d e leg a ted its r es pons i bi l i t i es fort he B r ed Funds cont r ar yt o St ate la w
. T he Le g i s l a t i v e Au d i t o rr e c o m m e n d e d t h a tt h e C o m m i s s i o n a s s u me r es pons i bi l i t y for admi ni s t er i ng t he Funds “unl es s an O pi ni on fr om t he O ffi ce of

t he A t t or neyG ener al i s obt ai ned t hats uppor t s t he del egat i on of admi ni s t er i ng t he Funds t o pr i vat e ent i t i es
. ”

II
A n a ly sis
A
. D elegati on of

A uthorit y by an A dm inis tr ati ve Agency
I ti s notunus ual fort he Legi s l atur e t o del egat e a meas ur e of gover nm ent al pow er t o a pr i vat e or gani zat i on. See 71 O pi ni ons of 9 the At t or ney G ener al1 8 9 , 1 9 0 -9 3 & n .2 (1 9 8 6 ). N e v e rth e les s, it is al s o a gene r al pr i nci pl e of admi ni s t r at i ve l aw t hat an admi ni s t r at i ve agenc ycannot , i n t he abs ence of expr es s l egi s l at i ve author i zat i on, del egat e i t s s t atut or y pow er s or funct i ons s uch t hat i t abdi cat es t he e x e r c i s e o f d i s c r e t i o n o rj u d g m e n ti n f a v o ro f t h a to f a p r i v a t e e n t i t y. O p in io n N o . 9 4 -0 5 0 (O c to b e r 5 , 1 9 9 4 ) (u n p u b lis h e d ). “T h is nondel egat i on d o ctr i ne ar i s es l ar gel yfr om conce r n fort he l os s of publ i c ac count abi l i t yt hatw oul d r es ul tfr om t he r el i nqui sh m entby a n a d m in istra tiv e a g e n c yo f its p o w e rs a n d f

u n c tio n s to a p riv a te e n t i t y
. ” 7 3 O

pi ni ons of

the At t or ney G ener al2 9 5 , 3 0 2 (1 9 8 8 ); s ee als o P er otv. Feder alE l ect i on C om m is s i on , 97 F. 3d 553, 559 ( D

. C

. C i r
. 1996) ( w hen t he l egi s lat u re spe ci fi cal l yves t s an age ncy w i t h aut hor i t yt o admi ni s t era s t atut e, t he age ncym ay not s hi ftt hat resp o n sibil ityto a p ri v ate a ctor).3 2 [8 8 O p
. A tt ’y
E ven w i t hi n an age ncy , t he del egat i on of author it y m aybe re s tr ic te d in s o m e in s ta n c e s
. See Q ues enber r y v

. W as hi ngt on Subur ban Sani t ar

y C om m is s i on , 311 M d. 417, 425, 535 A

. 2d 481 ( 1988) ( offi ci al s peci fi cal l ychar ged w i t h m aki ng a quas i

- j udi ci al admi n i s tr a t i v e deci s i on coul d notdel egat e ul t i m at e r es pons i bi l i t yfor t hatdeci s i on w i t hi n t he age ncy )

. I n o t heri ns t ance s , a boar d or c o m m iss io n m a yn o t d e leg a te d isc re tio n a ryf u n c tio n s s p e c if

ic a lly confe r r ed on i tby t he Legi s l atur e w i t houtpr ovi di ng pr i ori ns t ruct i on a n d s u b s e q u e n tr e v i e w o f t h e e x e r c i s e o f t h e d e l e g a t e d a u t h o r i t y. See 61 O pi ni ons of the At t or ney G ener al 734 ( 1976) ( del egat i on by B oar d of Publ i c W or ks t o i t s admi n ist rat or ) ; 50 O pi ni ons of

the A t t or ney G ener al 1 8 0 ( 1965) ( del egat i on byB oar d of Trus t ees of S tat e C o ll eg es to it s ad m inistrati v e a ssist an t)

. H ow ever , t hes e l i m i t at i ons on del egat i on do notm ean thatan a g e n c ym a yn o t d e leg a te a d m in istra tiv e d u ties th a t a re m in iste ria l in natur e. 61 Opinions of the Attorney General at736; s ee al

s o 73 C. J

. S. P ub l i c A dm i nis trat i ve L aw an d P rocedu re , § 5 6 , p p . 5 1 3 -1 5 ; Kr ug v. Li ncoln N

at

. Li f e I ns

. C o. , 2 4 5 F

. 2 d 8 4 8 , 8 5 3 (5th C ir

. 1 9 5 7 ). E xpr es s s t atut or yaut hor i t yi s notr equi r ed fort he del egat i on of s uch aut hor i t y , and l egi s l at i ve i nt entt o per m i tdel ega ti on w i t hi n an a g e n c ym a yb e in f

e rr e d

. EE O C v

. R a

y m o n d Me ta ls P r o d u c ts C o ., 3 8 5 F . S u p p . 9 0 7 , 9 2 1 -2 2 (D .M d . 1 9 7 4 ), a ff’d in p a rt a n d

re v ’din par ton othergr ounds , 530 F. 2d 590 ( 4 C ir

. 1 9 7 6 ). I n s hor t , t he th del egat i on of m i ni s t er i al dut i es i s per m i t t ed w hen i ti s not in c o n s is te n t w ith th e e n a b lin g s ta tu te

. Fi nal l y , t he gr antof br oad rul emaki ng aut hor i t yt o an age ncy m ay be a source of aut ho ri t y for delegat i on of som e of it s func t i on s. F l em i ng v. Mohaw k W

r eck i ng and Lum berC o. , 331 U

. S. 111, 121- 2 2 (1 9 4 7 ); D istric t o

f C o lu m b ia v . W

h ite , 435 A

. 2d 1 0 55, 1056- 57 (D .C .A p p . 1 9 8 1 ).
A ppl y i ng t he gene r al pr i nci pl es out l i ned above , w e t hi nk t he C o m m is s io n m a yd e leg a te m a n yo f its d u ties w ith re sp e c t to adm i nis t rat i on of the B red Fu nd s. B. Adm in is tr a ti o n o

f Ma r y la n d

-Br e d

Ra c e Fu n d

b y M HBA
I n t he l egi s l at i on es t abl i s hi ng t he M ar y l and B r ed R ace Fund, t he G ener al A s s embl ydel egat ed t o t he M H B A t he adminis t r at i ve funct i on of as s es s i ng t he qual i fi cat i ons of t hor oughbr ed hor s es and r e g i s t e r i n g t h e m t o p a r t i c i p a t e i n t h e M a r y l a n d

- Br e d Ra c e P r o g r a m.G en. 25] 33
I ts eems a l ogi cal di vi s i on of l aborfort he s ame en ti ty to m ake the i ni t i al det er m i nat i on of oth erdet ai l s of t he pr ogr am. T hus , t he C om m i s s i on m ayr el yon t he M H B A t o as s i s tw i t h ot herfunct i ons r el at ed t o t he M ar y land B r ed R ace Pr ogr am. T he M H B A m ay p rop o se w h en the B red F u n d rac es are t o b e run , h o w m a n y there s hal l be, the d is t ance pr ovi s i ons fors uch r ace s , the pur s es , and t he a m o u n ts o f

th e b re e d e rs ’ a w a rd s a s s ig n e d to e a c h ra c e
. T h e C o m m issi o n ’s reg u lat ion ref lects t h e a g en cy ’s l on gst and i ng adm i nis t rat i ve const ruct i on of t he B red Fu nd st at utes , w h ich g iv e s ris e to a stro n g p re su m p tio n th a t it s c o n stru c tio n is c o r r e c t. Luss i erv. Mar yl and R aci ng C om m is s i on , 343 M d. 681, 6 9 6

- 9 7 , 6 8 4 A. 2 d 8 0 4 ( 1 9 9 6 )

. M o r e o v e r , t h e a c t i o n s o f t h e M HBA reg ard ing the a d m inistrati o n o f th e M ary land -B re d R a ce F u n d are a lso su b jec t to th e re v ie w o f th e A d v iso ryC o m m itt e e , w h ich is di r ect ed bys t at u te t o hel p and advi s e t he C om m i s s i on. B R §§11- 5 3 1 th ro u g h 1 1 -5 3 4

. In o u r v iew , the C o m m iss io n ’s d e leg a tio n to th e M H B A is per m i s s i bl e i f t he C om m i s s i on pr ovi des t he nece s s ar y p ri or in stru c tio n to th e M H B A a n d re tain s f in a l au th o rityw ith re sp e c t to t hos e dec i s i ons t hatt he L egi s l atur e s peci fi cal l yas s i gned t o t he C om m i s s i on. For exampl e, t he C om m i s s i on m aydel egat e t o t he M H B A t he t as k of arr angi ng a sch ed ul e of Fund- s uppor t ed r ace s and, i n acc or dance w i t h t he C om m i s s i on’ s r egul at ions, comput i ng t he aw ar ds and ot herpaym ent s due fr om t he F u n d

. For t hat p u rp o se , the C o m m iss io n h a s s e t f o rth in re g u latio n e lab o ra te i ns t ruct ion s as t o t he cr i t er i a forthe s chedul i ng of r ace s and t he c o m p u tatio n o f

a w a rd s. B u t th e C o m m iss io n m u st no t ab d ica te its s t atut or yr ol e. T he ac tual s chedul e of r ace s and paym ent s fr om t he Fund m us tr emai n s ubject t o C om m i s s i on appr oval

. T he C om m i s s i on m us tr et ai n and exe r ci s e ul t i m at e co n tr ol overt he admi ni s t r at i on of t he Funds

. T he C om m i s s i on m us tm ai nt ai n a bank ac co u n t i n to w h ich f

u n d s are d ep o sit ed an d en su re tha t th e f u n d s are s e c u re d b yc o lla te ra l.
In su m , it is no t in a p p ro p ria te f o r th e C o m m iss io n to d e leg a te m in iste ria l f

u n c tio n s to th e M H B A , so lo n g a s it re tain s u lti m a te aut hor i t yfort hos e di s cr et i onar ydeci s i ons tha tt he Legi s l atur e has a s s ig n e d to th e C o m m is s io n
.3 4 [8 8 O p
. A tt ’y

The L egi s l aturehas grante d the Racing Commi ssion broad 10 authority to adopt rules gover

ning horse racingin Maryland. SeeBR §11- 210. In a case involving a challeng e to regulations a dopted by the Racing Commi ssion, the Court of Appeals stated that “whe re theL eg islature has de le g ate d s uc h b ro a d a

uth ority to a statea dmi nist ra

tiv e a g e nc y

to promulg ate regulations in an ar ea , the re gulations are valid under the statut e i f they

do not contradic t the statutory languag e or pur

pose.” Lussier v. Maryland Racing Commission , 343 Md. 681, 6 8 8 , 6 84 A.2d 804 (1996). A popular dic tionary

define s “employee”as “a person hire d by 11 another , or by

a business firm, et c. , to work for wag es or sa lary .” Webster’s Ne w World Dictionary (2d ed.) , p.459. We h av e not been a sked, and the ref ore do not a ddress, what other personne l laws may

apply to the administrator.
From 1977 to 1984, the Comm i s s i o n wa s bifurca ted into the 12 Thoroughbred Racing Boa rd and the Harness RacingBoa rd. SeeChapter 728, L aws of Ma

ryland 1977; Chapter 500, L aws of Ma ryland 1984. C. Adm inis tr ati on o

f Standar db r e d Fund
W i t h r es pectt o admi ni s t r at i on of t he St andar dbr ed Fund, t he C om m i s s i on has byr egul at i on cr eat ed t he pos i t i on of admi ni s t r at or o f th e F u n d

. T h e a d m in istra to r o f th e S tan d a rd b re d F u n d is 10 appoi nt ed byt he C om m i s s i on, s er ves at the pl eas ur e of the C om m i s s i on, and is p aid t he s al ar yand bene fi t s det er m i ned byt he C om m i s s i on. W e under s t and t hatt he admi ni s t r at or per for m s dut i es as s i g ned byt he C om m i s s i on i n acc or dance w i t h C om m i s s i on r egul at i ons gover ni ng t he St andar dbr ed F u n d

. B yvi r tual l yany defi ni t i on, t he admi ni s t r at ori s an empl oy ee of t he C om m i s s i on. 11
I n an opi ni on i s s ued appr oxi m at el y25 y ear s ag o , A t t or ney G eneral B urch recogn i zed the need for t h e C om m i ssi on ’s H arness R aci ng B oar d, w hi ch t hen had r es pons i bi l i t yfort he St andar dbr ed 12 F u n d , to r e ly o n a n e m p lo y e e to c a rryo u t it s re sp o n sib ili tyto p ro m o te M a ryla n d -b re d ra c in g th ro u g h th e F u n d

. See 62 O pi ni ons of the At t or ney G ener al755 ( 1977)

. T hatopi ni on di s cus s ed w het her t he s t atut e est abl i s hi ng t he St andar dbr ed Fund i m pl i ci t l yaut hor i zed paym ent s fr om t he Fund for t he s al ar y and expens es of an e m pl oy ee t o admi ni s t ert he Fund and t o “per for m t he dut ies o f pl anni ng and pr epar at i on for t he ra ces funded byi t

. ” Id

. at755. N ot i ng t hatt he re lev a n t p o rtio n s o f

th e sta tu te re g a rd in g th e F u n d w e re id e n tica l toG en. 25] 35

This opinion overruled a 1963 opinion that concluded that the 13 s tatute c r e ati n g th e M ar yla n d

- B r e d Ra c e F un d d id n o t autho riz e e xpe nditure s f

ro m th at F un d to de fray

thee xpe ns e s o f a

n empl oye e to promote rac ing supported by the Fund. See48 Opinions of the Attorney Gene ral 372 (1963). th o se re g a rd in g th e M a ry lan d -B re d R a c e F u n d a n d th a t, by l a w , b o th Funds w er e t o be admi ni s t er ed byt he C om m i s s i o n , the opi ni on concl uded t hat“t he expe ns es of adm i nis t r at i on and pr om ot i on t hat r eas onabl yr el at e t o t he purpos es of t he cr eat i on of t he F und and the advanc ement of s t andar dbr ed r aci ng m aypr oper l ybe pai d outof t he Fund. ” Id

. at 75 6 (em p h asis ad d ed ). 13
T he des i gnat i on of an a d mi ni s t r at ordoes notent ai l anyunus ual o r un w arran ted d eleg ati o n o f th e C o m m issi o n ’s resp o n sibil it ies. In ourvi ew , t he s i tuat i on i s no di ffe r ent t han i f t he C om m i s s i on as s i gned i t s r egul ars t aff t o carr youtt he mi ni s t er i al funct ions inv o lved in ad m inist ering the F u n d

. M o reo v er, th e a d m inistrator’s deci s i ons conce r ni ng admi ni s t r at ion o f t he Fund ar e s ubj ectt o t he re v iew o f t he A dv i soryC om m i t t ee t hat i s desi gn at ed b yst at ute t o hel p and advi s e t he C om m i s s i o n
. S o l ong as t he C om m i s s i on rem ai ns ult i m at el y res po nsi ble for deci si on s as t o the num ber, dates , and dis t ances of races , t he am ou nts of purses and breeder’s aw ards, a n d t h e o t h e rr e s p o n s i b i l i t i e s a s s i g n e d t o i t b y t h e G e n e r a l A s s e m b l y, the C o m m issi o n m ayloo k to it s s ta f f to p rov ide th e n ec essa ry a s s is ta n c e to a c c o m p lis h th o s e p u rp o s e s
.

III
C oncl usi on
I n o u ro p i n i o n , t h e Co mmi s s i o n ma yd e l e g a t e t o t h e M HBA admi ni s t r at i ve and m ini s t er i al dut i es r el at ed t o t he M ar y l and- B r ed R ace Fund. Si m i l ar l y , t he C om m i s s i on m aydel egat e t o an admi ni s t r at orempl oy ed fort hatpurpos e a d m ini s t r at i ve and m i ni s t er i al dut i es r el at ed t o t he M ar y l and St andar dbr ed R ace Fund. In eith er case , the C o m m issi o n m ay n o t d eleg ate d is cre ti o n ary funct i ons as s i gned t o i t byt he G ener al A s s embl yw i t houtpr ovi di ng3 6 [8 8 O p
. A tt ’y

pr i or i ns t ruct i on and s ubs equent r evi ew for t he M H B A and t he admi ni s t r at or , and t he C om m i s s i on m us tr et ai n fi nal aut hor i t yover t ho se di scr et i on aryfun ct i on s.

J. Jo sep h C u rran , Jr. A t t or ney G ener al
B ruce C. Spi zl er A ssista n t A tt o rn ey G eneral
R o b e rt N . M c D o n a ld C hi ef C ouns el O pi ni ons and A dvi ce