2023 New York Laws › PML - Racing, Pari-Mutuel Wagering and Breeding Law › Article 3 - Harness Racing and Breeding › 319 - Capital Improvements.

§  319.  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 or association that is
used or is to be used by such corporation or association  in  connection
with  the conduct of horse race meetings, and shall include improvements
to land but not land itself.
2.  (a)  Notwithstanding  the  provisions  of  section  three  hundred
eighteen  of  this  article, a harness track, may elect upon thirty days
written notice to the commission to withhold, in addition to  any  other
amounts  required  by this section, one percent of the total deposits in
pools resulting from regular and multiple bets, provided, however,  that
any  harness track 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.  Provided  further,  however,  that if the harness track was
owned prior to December thirty-first, nineteen hundred eighty-five, by a
nonprofit county agricultural society and leased by a racing association
such one percent shall be paid by the  association  to  the  society  as
additional rent. Such society shall use such one percent exclusively for
capital  improvements  as  defined  in  subdivision  one of this section
subject to the rules and regulations  of  the  commission.  The  capital
improvements  shall be determined by a committee of the society composed
of the executive director of the society, the  chair  of  the  board  of
directors  of  the  racing  association, or his or her designee, and the
general manager of the racing association.  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,  a  harness  track  and  shall  include
premium  giveaways, prizes, free admission, free parking, free programs,
additional monies for purses or other activities of a promotional nature
which stimulate on track attendance. In no event shall this  section  be
construed  to  permit  the  payment  of  salaries to employees of such a
harness track who are engaged in advertising or promotional activities.
(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, 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  association  or
corporation  for  commission  approval  includes  adequate provision for
expenditures relating to the continued health, safety and well-being  of
patrons,  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, 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 for a harness track
other  than  a  harness  track  authorized  to operate in Westchester or
Nassau  county  or  a  harness  track  owned  by  a  non-profit   county

agricultural  society  and  leased  by a harness racing association 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 or
association 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  or  association  exclusively  for
capital  improvements as defined in subdivision one of this section. All
such amounts borrowed by such corporation or association 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 or association shall surrender its
pari-mutuel  license  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   or
association  to  such  trust  shall  be  disposed  of in accordance with
provisions of law to be  enacted  for  such  purpose;  except  that  the
commission  shall  direct  that such sums therein deposited and all sums
due and owing from such corporation or association be transferred to the
credit of a successor in interest to  such  corporation  or  association
upon the licensing of such successor in interest by the commission. Such
trust  shall  be  established and administered pursuant to the rules and
regulations of the commission.