Court Opinion

ID: 4130335
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:03:04.561325+00
Date Added: 2024-06-11T14:33:32.352304
License: Public Domain

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    Mr. Hilary B. Doran, Jr.     . Opinion No. JM-1134
    Chairman
    Texas Racing COmmiSSiOn        Re:    Right of appeal to the
    P. 0. Box 12080                Texas Racing Commission'by a
    Austin, Texas   78711-2080     person fined at a nonpari-
                                   mutuel racetrack, validity of
                                   regulation of nonpari-mutuel
                                   racing, and related questions
                                   (RQ-1831)
    Dear Mr. Doran:
         You have asked whether the Texas Racing Commission's
    proposed rules for regulation of nonpari-mutuel racetracks
    were valid. By a subsequent request, you ask whether the
    commission should hear the appeal of a person fined or
    suspended at such a 'racetrack. Your second question has
    arisen because a trainer, fined at a nonpari-mutuel track
    when his horse did not pass a post-race drug test, wishes to
    appeal his fine and believes the commission might be liable
    to him in a civil suit. We now address both questions.    As
    the following discussion will explain, the rules for regula-
    tion of nonpari-mutuel racetracks are invalid because the
    Texas Racing Act does not contain a         constitutionally
    sufficient delegation of rulemaking authority for those
    tracks. Our answer to the first question renders the second
    question moot.
         The Texas Racing Act, V.T.C.S. art. 179e, establishes
    the Texas Racing Commission, authorizes it to regulate race-
    tracks involving pari-mutuel wagering, and sets out com-
    prehensive guidelines for that regulation. Attorney General
    Opinion JM-1102 (1989); m   Attorney General Opinion JM-1104
    (1989). Section 1.02 of the act states the purposes of the
    act:
               The purposes of this Act are to encourage
            agriculture, the horse-breeding industry, the
            horse-training industry, the greyhound-breed-
            ing industry, tourism, and employment .oppor-
            tunities in this state related to horse
            racing and greyhound racing and to orovide

                                  P. 5968
Mr. Hilary B. Doran, Jr. - Page 2   (JM-1134)

       for the strict reoulation and control of
       pari-mutuel waaerina in connection with that
       racinq. (Emphasis added.)
Section 3.02 grants regulation   and rulemaking authority   to
the commission:
       [T]he commission shall regulate and supervise
       every race meeting involvinu waaerinq on the
       result of greyhound or horse racing.      All
       persons and things relating to the operation
       of those meetings are subject to regulation
       and supervision. The commission shall adont
       rules   for   conductina   racina   involvinq
       waserino and shall adoat other rules to
       administer this Act that are consistent with
       this Act. (Emphasis added.)
     The commission has adopted rules for racetracks that do
not conduct pari-mutuel wagering, citing section 3.02 of the
act as authority. 14 Tex.Reg. 1364-65 (March 14, 1989).
However, section 3.02 expressly authorizes the commission to
promulgate rules and regulations only for racetracks that
conduct pari-mutuel wagering. The legislative guidelines
set out in article 179e relate to pari-mutuel wagering and
its regulation.   See, e.a    V.T.C.S. art. 179e, 55 5.01-
6.06, 7.01-7.10 (1icensing"provisions for tracks involving
pari-mutuel wagering), 6.08-6.tO. (allocating shares      of
pari-mutuel pools), l;.;; l~rcp-lw     financial disclosure
from licensees),      . - .       (wagering   restrictions),
13.01-15.02 (providing penalties for misconduct or illegal
conduct at or involving racetracks that conduct pari-mutuel
wagering), 16.01-17.06 (requiring local and state elections
prior to licensing of pari-mutuel tracks).
     In Attorney General Opinion JM-971 (1988), we concluded
that the Texas Racing Commission was not authorized to
license persons subject to regulation at racetracks that do
not conduct pari-mutuel wagering.' The opinion,        which
primarily discusses the authority of the commission to
classify and license pari-mutuel horse racing tracks, states
that the commission has only those powers granted by statute
expressly, or necessarily implied, and it may not enlarge on
those express or implied powers. Attorney General Opinion
JM-971, at 1.   The opinion noted in passing that article
179e-4, V.T.C.S., extends the commission's regulatory powers
to include racetracks that do not conduct pari-mutuel
wagering, but held that the power to regulate does not
include the power to license persons subject to regulation.
Id. at 5.

                             P. 5969
Mr. Hilary B. Doran, Jr. - Page 3   (JM-5970)

     After the issuance of Attorney General Opinion JM-971,
the commission promulgated regulations for "registration" of
nonpari-mutuel tracks.    Registration is conditional: in
order to register, a racetrack must either obtain prior
approval from the American Quarter Horse Association or
agree to follow the commission's regulations for nonpari-
mutuel racetracks. 16 T.A.C. 5 303.152.
     The regulations that the nonpari-mutuel track must
comply with in order to llregisterl*with the commission
include specific hiring and reporting requirements.      For
example, if not approved by the American Quarter Horse
Association, a racetrack that does not conduct pari-mutuel
wagering must provide commission-approved stewards, horse
identifiers, observers, a veterinarian, and a test barn.
Id. The track must test animals for the presence of drugs.
Id.   Race dates must be approved in advance, and
"condition book" must be delivered to the commission a:
least 10 days before each race meeting.     Id. 55 303.153,
303.155. Additionally, the rules for racetracks that do not
conduct pari-mutuel wagering state that the commission may
revoke the licenses of persons licensed by the commission
(presumably under the regulations for pari-mutuel racing),
exclude race animals from racing at pari-mutuel tracks, and
revoke nonpari-mutuel registrations in case of violations.
Id. 55 303.156-303.15s. The commission will consider a
violation of the rules for nonpari-mutuel racetracks by a
person who later applies for a license under the regulations
for racetracks involving pari-mutuel wagering.      &g&A.-
5 303.202(2).
     Attorney General Opinion     JM-971 stated that     the
commission had authority under V.T.C.S. article 179e-4 to
regulate nonpari-mutuel racetracks, but that the power to
regulate did not include "the power to require licenses from
persons subject to regulation unless the legislature so
provides." Attorney General Opinion JM-971, at 5. We now
conclude that article 179e-4 as written does not even
authorize the commission to require registration.    Article
179e-4 does not establish any standards or guidelines for
regulation, nor does     it require    that regulation    of
nonpari-mutuel tracks must be reasonable. Article 179e-4
reads, in its entirety:
           Any provision in this Act to the contrary
        notwithstanding, the Texas Racing Commission
        shall regulate all aspects of      greyhound
        racing and horse racing in this       state,

                             P. 5970
Mr. Hilary B. Doran, Jr. - Page 4   (JM-1134)

        whether or not that racing      involves   pari-
        mutuel wagering.
     Attorney General Opinion JM-971 dealt with        three
questions about the licensing of horse racing tracks.   Only
one of the questions related to racetracks without pari-
mutuel privileges, and it could be answered without raising
the issue of the constitutionality of article 179e-4.   Your
present question about the trainer's wish to appeal a fine
received at a nonpari-mutuel track has caused us to look
closely at this provision and to determine that it delegates
legislative authority to the commission without adequate
standards to guide its exercise of such authority.   Article
179e-4 is therefore unconstitutional as violative of the
separation of powers principle of the Texas Constitution,
and the commission's rules for "registration" of tracks that
do not involve pari-mutuel wagering are invalid.        Tex .
Const. art. II, § 1; see also ie, art. III, 5 1.    Attorney
General Opinion JM-971 is modified to the extent that it
suggests that article 179e-4 authorizes the commission to
regulate nonpari-mutuel racing.
     Article II, section 1, which states the principle     of
separation of powers, provides as follows:
           The powers of the Government of the State
        of Texas shall be divided into three distinct
        departments, each of which shall be confided
        to a separate body of magistracy, to wit:
        Those which are Legislative to one, those
        which are Executive to another, and those
        which are Judicial to another; and no person,
        or collection of persons, being of one of
        these departments, shall exercise any power
        properly attached to either of the others,
        except in the instances herein expressly
        permitted.
     The legislature may delegate rulemaking authority to an
administrative agency such as the Texas Racing Commission.
Housina Auth. v. Hicfainbotham, 143 S.W.Zd 79, 87 (Tex.
1940). A valid delegation of authority does not require the
legislature to anticipate every administrative condition and
detail. Id.; see also TraDD v. Shell Oil Co., 198 S.W.2d
424, 438 (Tex. 1946).     The law, however. must clearlv
express public policy.and establish administrative standards
and guidelines so that the agency has only to make rules to
which the legislative policy applies. Hicainbotham, B,
at 87: see also Med-Safe v. State, 752 S.W.2d 638, 640 (Tex.
APP. - Houston [lst Dist.] 1988, no writ). A legislative

                              P. 5971
Mr. Hilary B. Doran, Jr. - Page 5 (JR-1134)

delegation of rulemaking    authority must also   provide
procedural protection for persons subject to those rules.
TraDV, sunra, at 439.
     In Med-Safe, the court held that the delegations of
regulatory power to the Department of Health to require and
issue permits pursuant to the Solid Waste Disposal Act,
V.T.C.S. art. 4477-7, 5s 3(a), 4(e), were constitutional.
Med-Safe, suvra, at 639-41.   Those statutes included clear
statements of purpose, guidelines, and definitions. See id.
In Winincer v. Devartment of Human Resources, 663 S.W.2d 913
(Tex. App. - Fort Worth 1983, no writ), delegation of
authority to the Department of Human Resources under the
Child Care Licensing Act was held valid because chapter 42
of the Human Resources Code sets forth guidelines that the
department must follow and provides for appeal of          a
department decision. Id. at 915; see also Oxford v. Hill,
558 S.W.2d 557, 560 (Tex. Civ. App. - Austin 1977, writ
ref'd) (portion of Child Care Licensing Act held consti-
tutional because    it included    specific standards    and
guidelines, such as provisions for immunization of children,
inspection of child care homes, and licensing, "thereby
overcoming any doubt implying vagueness or generality in the
Act"). In w,       the supreme court held that legislative
acts delegating to the Railroad Commission the duty to
execute and enforce oil and gas conservation statutes and
the power to regulate a business substantially connected
with the public interest were valid because both public and
private legal rights were protected by the statutes.
     Texas courts have held statutes delegating authority to
administrative agencies unconstitutional when the delega-
tions are unclear, unlimited, or incomplete.       In Texas
Antiouities Comm. v. Dallas Countv Communitv Collese Dist.,
554 S.W.2d 924 (Tex. 1977), the supreme court held section 6
of the Antiquities Code unconstitutional and rejected the
argument that legislative power to delegate authority to
state boards or commissions composed of experts should be
unlimited. In re Johnson, 554 S.W.2d 775, 782 (Tex. Civ.
APP. - Corpus Christi 1977, writ ref'd n.r.e.), the court
held that a statute delegating authority to judges to set
court reporters' fees in a "reasonable amount" was un-
constitutionally vague, and explained that a valid statutory
delegation of authority must be complete. The court stated:
           One of the most important tests in deter-
        mining whether a particular law is an invalid
        delegation of legislative power is found in
        its completeness as it appears when it leaves
        the hands of the legislature. The generally

                             p. 5972
Mr. Hilary B. Doran, Jr. - Page 6   (JM-1134)

        recognized principal is that a law must be so
        comvlete in all its terms and nrovisions when
        it leaves the lecislative branch that nothinq
        is left to the iudcrmentof the recipient of
        the delecrated vower.   The riahts. duties.
        PriVileaeS. or obliaations aranted or hIDOSed
        must be definitelv fixed or determined, or
        the rules bv which thav are to be fixed and
        determined must be clearlv and definitely
        established. when the act is vassed. . . .
        If the legislature has prescribed sufficient
        standards to guide the discretion conferred,
        the power is not legislative and the dele-
        gation is lawful (quoting 12 Tex.Jur.Zd,
        Constitutional Law s 62). (Emphasis added.)
Id. at 781.    In our opinion, the provisions    of   article
179e-4, V.T.C.S., fall short of this standard.
     We think that the legislature intended to authorize the
commission to regulate nonpari-mutuel racetracks when it
enacted V.T.C.S. article 179e-4, and we do not question
that intent.   Attorney General Opinion JM-971: see also
Attorney General Opinion JM-1102.      However, the    power
delegated to the commission by the statute as it is written
is so broad that it leaves all policy-making and rulemaking
discretion to the commission. Without sufficient guide-
lines, such a delegation of authority grants the commission
a law-making function and violates the Texas Constitution.
Moodv v. Citv of Univ. Park, 278 S.W.2d 912, 921-22 (Tex.
Civ. App. - Dallas 1955, writ ref'd n.r.e.).
     Article 179e and article 179e-4 were adopted         as
different sections of the same bill.    a   Acts 1986, 69th
wf- I 2d C.S., ch. 19, 55 1, 8, at 48, 76. Mindful of the
rule that all sections of a bill enacted by the legislature
should be read and interpreted so as to present a harmonious
whole, State ex rel. Childress v. School Trustees of Shelby
County, 239 S.W.2d 777 (Tex. 1951), we have considered
whether article 179e-4 could be given an interpretation that
would render it constitutional by reading it to incorporate
the standards that article 179e imposes on the commission's
exercise of authority to regulate pari-mutuel tracks.     We
have, however, rejected the possibility that article 179e-4
can be read as making the provisions of article 179e
applicable to nonpari-mutuel racetracks as well as to tracks
with pari-mutuel betting. Some provisions of article 179e
are irrelevant to a racetrack that does not have pari-mutuel
betting. See, e.a., V.T.C.S. art. 179e, 55 3.07(e), 4.05,
6.08, 7.01-7.10, 11.01-11.09.

                              Pi 5973
Mr. Hilary B. Doran, Jr. - Page 7 (JM-1134)

     An express statement of legislative intent iS  required
before certain forms of regulation may     be imposed on a
private entity such as the licensing of nonpari-mutuel
tracks at issue in Attorney General Opinion JM-971.     Your
question about the trainer's right to appeal his fine
provides a good illustration~of the difficulties inherent in
a construction that would require the commission to decide
which article 179e standards the legislature intended to
apply to article 179e-4.. The commission determined that it
had authority to require nonpari-mutuel tracks to have
commission-approved stewards to test horses for drugs, but
that it did not have authority to hear a trainer's appeal
from a fine and suspension imposed by the stewards when his
horse tested positive for a prohibited drug. The commission
is therefore placed in the position of deciding the limits
of its authority over nonpari-mutuel racetracks.         The
constitution requires the legislature to make this decision,
and to accompany its delegation of authority to          the
commission with some  statement of these limits. This was
neither accomplished in the language of article 179e-4 nor
the language of article 179e. m    Texas Antiquities Comm.,
suvra, at 928 (statutory delegation of power is too vague
when persons of ordinary intelligence must "guess at its
meaning and differ as to its applicationll).
     We decline to answer your question about possible civil
liability, because it involves issues of fact that cannot be
resolved through the opinion process.1
     Because we find that article 179e-4 is unconstitutional
as written, and the rules promulgated pursuant to that
article are void, we must address the effect of the

     1. Section 14.03 of article 179e instructs the commis-
sion to require post-race drug testing of race animals and
states that the "licensed trainer" of the animal is deemed
by law to be responsible for seeing that no drugs or stimu-
lants have been administered to the animal. The section
also provides for disqualification of the animal, suspension
of the person responsible for administering the drug, and
right of appeal to the commission. Section 18.06 of article
179e further provides that the commission is not liable for
any cause of action arising from good faith enforcement of
the act. We have determined that article 179e rules and
regulations apply only to racetracks that allow pari-mutuel
wagering: therefore, these provisions for drug testing and
appeal are not applicable in this case.

                              P. 5974
Mr. Hilary B. Doran, Jr. - Page 8 (JM-1134)

invalidity of article 179e-4 on the other portions of the
act. Section 312.013 of th.eGovernment Code sets out the
rule for construction of statutes that have been found to be
partially invalid: the invalidity of part of a statute does
not affect valid provisions of the statute that can be given
effect without the invalid part unless the statute expressly
provides that it is not severable. The Texas Racing Act
does not expressly provide that invalid portions of the
statute are not. severable.2 m     Attorney General Opinion
M-1190 (1972), at 4.
     In In re Johnson, suora, at 787, a Texas court of
appeals held that if the unconstitutional portion of a
statute was severable from the rest, then the whole law
should not be invalitiated. The court found that one para-
graph of V.T.C.S. article 2324 (now sections 52.046 and
52.047 of the Government Code), a three paragraph statute,
was unconstitutional. The statute did not contain a sever-
ability clause. The court stated that declaring a part of
the act invalid did not render the entire act void unless
the two parts were so intermingled as to make         them
inseparable. Id.    In our opinion, the provisions of the
Texas Racing Act are not mutually dependent and can be
separated. Article 179e-4 can be severed from the act
without affecting the provisions of V.T.C.S. articles 179e
through 179e-3.

                      SUMMARY
          Article 179e-4 of the Texas Racing Act,
       granting the Texas Racing Commission the
       authority to regulate racetracks that do not
       allow pari-mutuel wagering, delegates legis-
       lative authority without adequate standards
       and is therefore an unconstitutional delega-
       tion of legislative authority.       Attorney
       General Opinion JM-971 (1988) is accordingly
       modified to the extent that it states that
       V.T.C.S.   article    179e-4   permits    the

     2. We note that article 179e, section 17.06, V.T.C.S.,
provides that section 311.032 of the Government Code, the
Code Construction Act, applies to the Texas Racing Act.  We
believe section 312.013, providing rules for construction
of civil statutes, is the applicable law.      Under either
statute, the result is the same.

                             p. 5975
c   Mr. Hilary B. Doran, Jr. - Page 9    (JM-1134)

            commission to regulate tracks that       do   not
            allow pari-mutuel wagering.
               The provisions of V.T.C.S. articles   179e
            through 179e-3 are severable from the pro-
            visions of article 179e-4 ; therefore, arti-
            cles 179e through 179e-3 are not affected by
            the invalidity of article 179e-4.

                                         JIM     MATTOX
                                         Attorney General of Texas
    MARY KELLER
    First Assistant Attorney General
    LOU MCCREARY
    Executive Assistant Attorney General
    JUDGE ZOLLIE STEAKLEY
    Special Assistant Attorney General
    RICK GILPIN
    Chairman, Opinion Committee
    Prepared by Karen C. Gladney
    Assistant Attorney General

                                   p. 5976