2023 New York Laws › PML - Racing, Pari-Mutuel Wagering and Breeding Law › Article 2 - Thoroughbred Racing and Breeding › 237 - Capital Improvements.

§  237.  Capital  improvements.  1.  For the purposes of this section,
"capital improvement" shall mean any  addition  to,  replacement  of  or
remodeling  of  the  physical  plant,  structures  and  equipment now or
hereafter owned or leased by a racing corporation that is used or is  to
be used by such corporation in connection with the conduct of horse race
meetings, and shall include improvements to land but not land itself.
2. (a) Any non-franchised corporation authorized under this chapter to
conduct  pari-mutuel betting at a race meeting on races run thereat, may
elect upon thirty days written notice to the commission to withhold from
the pari-mutuel pool in addition to any other amounts required  by  this
section,  one  percent  of  the  total  deposits in pools resulting from
regular and multiple on-track bets; provided,  however,  that  any  such
corporation  withholding pursuant to this subdivision shall use at least
fifty percent of such one percent exclusively for  capital  improvements
as  defined  in subdivision one of this section subject to the rules and
regulations of the commission. An amount, not to exceed fifty percent of
such one percent, may be used for  advertising  and  promotion  expenses
subject to the rules and regulations of the commission. For the purposes
of  this  paragraph  the  term  "advertising"  shall  be limited to paid
advertising through radio, television, the print media, direct  mail  or
billboards.  Promotions  shall  mean  activities  that  are  intended to
increase the attendance at, or visibility of, any such  corporation  and
shall  include  premium giveaways, prizes, free admission, free parking,
free programs, additional monies for purses or  other  activities  of  a
promotional nature that stimulate on-track attendance. In no event shall
this section be construed to permit the payment of salaries to employees
of  any  such  corporation who are engaged in advertising or promotional
activities, provided, however, that  monies  credited  to  such  capital
improvement   account   on   or  before  July  first,  nineteen  hundred
ninety-six, as certified by the commission, shall not  be  expended  for
any  such  advertising  and  promotion  as defined herein. Such election
shall terminate upon thirty days written notice to the commission.
(b) At least once annually,  prior  to  approving  any  plan  for  the
expenditure  of such capital improvement funds pursuant to this section,
the  commission  shall,   together   with   the   track   operator   and
representatives  of  the horsemen's organization representing owners and
trainers  using  the  facility  and  representatives  of   the   jockeys
organization   representing  licensed  jockeys  and  apprentice  jockeys
regularly riding or exercising at  such  facility,  inspect  the  entire
facility, including the area commonly referred to as the backstretch, in
order to determine whether the capital improvement plan submitted by the
corporation  for  commission  approval  includes  adequate provision for
expenditures relating to the continued health, safety and well-being  of
patrons,  jockeys,  backstretch  personnel and the horses in their care.
After such inspection, if  the  commission  shall  determine  that  such
proposed  plan  does  not  include  adequate  provision  for repairs and
improvements necessary to correct any conditions that it has  determined
to  be  unsafe  or  otherwise  deleterious  to  the health and safety of
patrons, jockeys, employees or horses, the commission shall require  the
track operator to modify its capital improvement plan to provide for the
expenditure of funds for such repairs and improvements.
3. On or after July first, nineteen hundred ninety such amounts as may
be  withheld  for  the  purposes of this section shall be deposited in a
trust fund, kept and maintained by such corporation and administered  by
a  trustee  approved  by  the commission for the purpose of lending such
sums and any interest thereon on an unsecured basis to such  corporation
exclusively  for  capital  improvements as defined in subdivision one of
this section. All such amounts borrowed by such  corporation  from  such

trust  shall be forgiven and deemed satisfied according to a schedule of
depreciation deductions for  federal  and  New  York  state  income  tax
purposes  for  such related capital improvements. It is further provided
that  at  such  time as such corporation shall surrender its pari-mutuel
license or franchise or fail to apply for a pari-mutuel license for  the
succeeding  year by December thirty-first of the preceding year that the
commission may declare the trust fund at an end  and  all  sums  therein
deposited plus all sums due or owing from such corporation to such trust
shall  be disposed of in accordance with provisions of law to be enacted
for such purpose. Such  trust  shall  be  established  and  administered
pursuant to the rules and regulations of the commission.