NY Rac, Pari-Mut Wag & Breeding L § 236 (2021)
2021 New York Laws PML - Racing, Pari-Mutuel Wagering and Breeding Law Article 2 - Thoroughbred Racing and Breeding 236 - Disposition of Pari-Mutuel Pools; Percentage Payable to State as a Tax; Authority of Counties of Certain Cities to Impose a Tax.

§  236.  Disposition of pari-mutuel pools; percentage payable to state as a tax; authority of counties or certain cities to impose a tax.    1. Every  corporation  authorized under this chapter to conduct pari-mutuel betting at a race meeting on races run thereat, except  as  provided  in section  two  hundred  thirty-eight  of this article with respect to the franchised corporation, shall  distribute  all  sums  deposited  in  any pari-mutuel  pool  to  the holders of winning tickets therein, providing such tickets be presented for payment before April  first  of  the  year following  the  year  of  their  purchase,  less an amount that shall be established and retained by such racing corporation of between  fourteen to  twenty percent of the total deposits in pools resulting from regular on-track bets and less  sixteen  to  twenty-two  percent  of  the  total deposits  in pools resulting from multiple on-track bets and less twenty to thirty percent of the total deposits in pools resulting  from  exotic on-track  bets  and less twenty to thirty-six percent of the total pools resulting  from  super  exotic  on-track  bets,  plus  the  breaks.  The retention rate to be established is subject to the prior approval of the commission.  Such  rate  may  not be changed more than once per calendar quarter to be effective on  the  first  day  of  the  calendar  quarter. "Exotic  bets"  and "multiple bets" shall have the meanings set forth in section five hundred nineteen of this  chapter  and  breaks  are  hereby defined  as  the odd cents over any multiple of five for payoffs greater than one dollar five cents but less than five dollars, over any multiple of ten for payoffs greater than five dollars but less  than  twenty-five dollars,  over  any  multiple  of  twenty-five  for payoffs greater than twenty-five dollars but less than two hundred fifty dollars, or over any multiple of fifty for payoffs over two  hundred  fifty  dollars.  "Super exotic  bets"  shall have the meaning set forth in section three hundred one of this chapter. Of the amount so retained there shall  be  paid  by such  corporation  to  the  department  of  taxation  and  finance  as a reasonable tax by the state for the privilege of conducting  pari-mutuel betting  on  the races run at the race meeting held by such corporation, which tax is hereby levied, the following percentages of the total pool, plus fifty-five percent of the breaks; the applicable rates for  regular and  multiple  bets  shall  be  one and one-half percent; the applicable rates for exotic bets shall be six and  three-quarter  percent  and  the applicable  rate  for super exotic bets shall be seven and three-quarter percent. Effective  on  and  after  September  first,  nineteen  hundred ninety-four, the applicable tax rate shall be one percent of all wagers, provided  that,  an  amount equal to one-half the difference between the taxation rate for on-track regular,  multiple  and  exotic  bets  as  of December  thirty-first,  nineteen  hundred ninety-three and the rates on such on-track wagers as herein provided shall be  used  exclusively  for purses. Provided, however, that for any twelve-month period beginning on April  first in nineteen hundred ninety and any year thereafter, each of the applicable rates set forth above shall be increased  by  one-quarter of  one percent on all on-track bets of any such racing corporation that did not expend an amount equal to at least one-half of  one  percent  of its  on-track  bets  during  the immediately preceding calendar year for enhancements consisting of capital improvements as  defined  by  section two hundred thirty-seven of this article, repairs to its physical plant, structures,  and  equipment used in its racing or wagering operations as certified by the commission to the commissioner of taxation and  finance no  later  than  eighty  days after the close of such calendar year, and five special events at each track in each calendar year,  not  otherwise conducted in the ordinary course of business, the purpose of which shall be  to encourage, attract and promote track attendance and encourage new and continued patronage, which events shall  be  subject  to  the  prior  approval  of  the  commission  for  purposes of this subdivision. In the determination  of  the  amounts  expended  for  such  enhancements,  the commission  may consider the immediately preceding twelve-month calendar period  or  the  average  of  the two immediately preceding twelve-month calendar periods. Provided further, however, that of the portion of  the increased  amounts  retained  by  such  corporation  above those amounts retained in nineteen hundred eighty-four, an  amount  of  such  increase shall be distributed to purses in the same proportion as commissions and purses were distributed during nineteen hundred eighty-four as certified by  the  commission. Such corporation in the second zone shall receive a credit against the daily tax imposed by this subdivision  in  an  amount equal  to four-tenths of one percent of total daily pools resulting from the  simulcast  of  such  corporation's  races  to  licensed  facilities operated  by  regional off-track betting corporations in accordance with section one thousand eight of this chapter, provided however, that sixty percent of the amount of  such  credit  shall  be  used  exclusively  to increase  purses for overnight races conducted by such corporation; and, provided further, that in no event shall such total daily credit  exceed four-tenths of one percent of the total daily pool of such corporation.   Such corporation shall pay to the New York state thoroughbred breeding and development fund one-half of one percent of the total daily on-track pari-mutuel  pools  from  regular,  multiple  and exotic bets, and three percent of super exotic bets. The corporation shall receive credit as  a reduction  of  the  tax  by  the  state  for the privilege of conducting pari-mutuel betting for the amounts,  except  amounts  paid  from  super exotic  betting  pools, paid to the New York state thoroughbred breeding and   development   fund   after   January   first,   nineteen   hundred seventy-eight.   Such  corporation  shall distribute to purses an amount equal to fifty percent of any  compensation  it  receives  from  simulcasting  or  from wagering conducted outside the United States. Such corporation shall pay to  the  commission  as  a  regulatory  fee, which fee is hereby levied, six-tenths of one percent of the total daily on-track pari-mutuel  pools of such corporation.   2.  The  balance  of  the  retained percentage of such pool and of the breaks shall be held by such corporation for its own use  and  purposes, except  that  in  addition  to  any  payments  to purses provided for in subdivision one of this section, an amount equal  to  two  and  one-half percent  of  the  total  pools  resulting from on-track regular bets and exotic bets and an amount equal to three and  one-half  percent  of  the total pools resulting from on-track multiple bets and an amount equal to twelve  percent  of on-track super exotic bets shall be used exclusively for the purpose of increasing purses  (including  stakes,  premiums  and prizes)  awarded  to horses in races conducted by such corporation. Such two and one-half percent and three and  one-half  percent  shall  be  in addition  to (i) four and one-half percent of such total pools resulting from regular and multiple wagers and five and one-half percent  of  such total pools resulting from exotic wagers, or (ii) the percentage of such total  pools  used  for  purses  (including stakes, premiums and prizes) during the year nineteen hundred eighty-two, whichever is  larger.  Such percentage  of  the  total  pools mentioned in this subdivision shall be used for  purses  (including  stakes,  premiums  and  prizes)  in  races hereafter  conducted  by  such  corporation, and any portion not so used during any year shall be so used  during  the  following  year,  failing which  such portion shall be payable to the commissioner of taxation and finance as additional tax.  The commission shall report annually, on  or before  July  first,  to  the  director  of the budget, the chair of the senate finance committee and the chair of the assembly  ways  and  means  committee  the  extent  to  which  such  corporation  used  and retained percentages  and   breakage   for   operations,   maintenance,   capital improvements,  advertising  and  promotion,  administration  and general overhead  and  evaluate  the effectiveness and make recommendations with respect to the application of the reduced rates of taxation as  provided for  in  subdivision one of this section in accomplishing the objectives stated therein. Such report  shall  also  specify  the  amount  of  such retained  percentages  and  breakage  used  for investments not directly related to racing activities and such amounts used to declare  dividends or  other profit distributions, additions to capital stock, its sale and transfer and additions to retained earnings.  Such  reports  shall  also include  an  analysis  of any such agreements or proposals to conduct or otherwise expand wagers authorized under article ten of this chapter and present its conclusions with respect to the conduct  of  such  wagering, the  nature  of  such  proposals  and agreements, and recommendations to ensure the future maintenance of the intent of this article.   3. Tax rates in event of a  failure  to  maintain  pari-mutuel  racing activity.  a. Notwithstanding any other provision of this section to the contrary, for any calendar year commencing on or  after  January  first, nineteen  hundred eighty-nine, in which a racing corporation in zone two does  not  conduct  a  minimum  number  of  pari-mutuel   programs   and pari-mutuel  races at its facilities equal to at least ninety percent of the programs and races so conducted during nineteen hundred  eighty-five or during nineteen hundred eighty-six, whichever is less, in lieu of the tax  rates  set  forth in subdivision one of this section the applicable pari-mutuel tax rates for such  corporation  with  respect  to  on-track pari-mutuel  betting  pools  during  such year shall be increased by one percent of regular, multiple and exotic betting  pools.  Notwithstanding the foregoing, no increase shall be proposed unless such corporation has been  afforded  notice and opportunity to be heard. The commission shall promulgate rules and regulations to implement the provisions relating to notice and hearing.   b. The provisions of this subdivision shall not apply to a corporation for any  calendar  year  for  which  the  commission  certifies  to  the commissioner of taxation and finance:  (i) by December fifteenth of the year immediately preceding such year, that such corporation has been assigned for such year, from the programs and  races  it  requested,  at  least the minimum number of programs and races prescribed in paragraph a of this subdivision, or, if  fewer  than such  number  were  assigned  for such year, that the assignment of such lesser number was for good cause due to factors beyond  the  control  of such  corporation  or  because  the  commission  found  that it would be uneconomical or impractical for such  corporation  to  be  assigned  the prescribed number; and  (ii)  by  January  thirty-first  of the year immediately subsequent to such year, that such corporation did conduct such number of programs and races as were certified pursuant to subparagraph (i) of this  paragraph, or  if  it  failed to conduct such number that such failure was for good cause due to factors beyond its control or because the commission  found it  uneconomical  or  impractical for such corporation to conduct such a number.   c. For any calendar year for which the  commission  does  not  certify pursuant  to  the  provisions of subparagraph (i) of paragraph b of this subdivision with respect to a  corporation,  the  tax  imposed  by  this section  shall be computed by substituting the provisions of paragraph a of this subdivision for  the  provisions  of  subdivision  one  of  this section  and  shall  pay  the  tax  so  computed  to the commissioner of taxation and  finance.  In  such  computation  and  payment,  all  other  provisions  of  this  section  shall  apply as if the provisions of this paragraph and of paragraph a of this subdivision had  been  incorporated in whole in subdivision one of this section.   d.  For  any  calendar  year for which the commission does not certify pursuant to the provisions of subparagraph (ii) of paragraph b  of  this subdivision  with  respect to a corporation, the tax required to be paid hereunder for such year shall be equal to the difference between the tax imposed pursuant to paragraph a of this subdivision and the tax  imposed pursuant  to  the  provisions  of  subdivision  one of this section less one-half of such difference in recognition of purses that were  required to  be  paid, plus an additional amount equal to ten percent of such tax in the event of a willful failure  to  comply  with  the  provisions  of subparagraph   (ii)  of  paragraph  b  of  this  subdivision,  and  such corporation shall pay  the  tax  so  computed  to  the  commissioner  of taxation and finance on or before March fifteenth of the following year. Notwithstanding  the  provisions  of this subdivision, in the event that upon  appeal  from  the  determination  of  the  commission   that   the certification  provided  in  paragraph b of this subdivision will not be made, it is finally determined that the commission erred in  failing  to so  certify and that any moneys received by the commissioner of taxation and finance under paragraph c of this subdivision were  paid  in  error, the  same  shall  be refunded at the rate of interest of six percent per annum. Payment of such balance of tax due, or the anticipation  of  such payment,  shall  not  affect  the determination of purses in the year in which such tax arises or in the year in which such payment is  made  nor shall such payment in any other manner be considered in any statutory or contractual calculation of purse obligations.   e.  Written  notice of the certification of the commission pursuant to the provisions of paragraph b of this subdivision shall be given by  the commission to the applicable corporation by the dates therein specified. In  like manner, written notice that such certification will not be made shall be given by the commission to the  commissioner  of  taxation  and finance and the applicable corporation by such dates.   4.  The payment of the state tax imposed by this section shall be made to the commissioner of taxation and finance on the last business day  of each  month  and shall cover taxes due for the period from the sixteenth day of the preceding month through the  fifteenth  day  of  the  current month provided, however, that such payments required to be made on March thirty-first  shall  include all taxes due and accruing through the last full week of racing in  March  of  the  current  year  or  as  otherwise determined  by  the  commissioner  of taxation and finance, and shall be accompanied by a report under  oath,  showing  the  total  of  all  such contributions,  together with such other information as the commissioner of taxation and finance may require. A penalty of five  per  centum  and interest  at  the  rate  of  one  per centum per month from the date the report is required to be filed to the date of payment of the  tax  shall be payable in case any tax imposed by this section is not paid when due. If  the  commissioner of taxation and finance determines that any moneys received under this subdivision were paid in error, the commissioner  of taxation  and finance may cause the same to be refunded without interest out of any moneys collected thereunder, provided an application therefor is filed with the commissioner of taxation and finance within  one  year from  the  time the erroneous payment was made. Such taxes, interest and penalties when collected,  after  the  deduction  of  refunds  of  taxes erroneously  paid,  shall  be  paid  by the commissioner of taxation and finance into the general fund of the state treasury.   5. No county, city, town, village or other  political  subdivision  of the state may impose, levy or collect a tax on admission fees or tickets  of  admission,  on  wagers  made by patrons, in the form of purchases of pari-mutuel tickets or upon  such  tickets,  on  pari-mutuel  pools,  on breaks,  on  dividends  or  payments made to winning bettors, or on that part  of  the  pari-mutuel  pools  or  breaks  to  be retained by racing corporations under this section, except as otherwise  provided  in  this chapter.