N.Y. Racing, Pari-Mutuel Wagering and Breeding Law § 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.