Takeout Increase Gains Calif. Assembly Nod

A bill aimed at easing the strain of workers' compensation insurance costs for California horsemen by raising pari-mutuel takeout on exotic wagers by a half of a percentage point cleared the state Assembly by unanimous vote May 3. It is headed to Gov. Arnold Schwarzenegger for his signature.

The measure is expected to generate about $9.5 million annually to help racing defray the costs of workers' compensation insurance. It bumps the takeout on all wagers other than win, place or show, from 20.18% to 20.68% on Thoroughbred races. It makes increases in deductions from Quarter Horse, Standardbred and mixed breed county fair races as well.

The bill by Assemblyman Jerome E. Horton (D-Inglewood) establishes an industry organization to oversee dispersal of the workers' compensation fund. The takeout increase would expire in 2010 unless deemed unnecessary prior to that.

Racing officials are hopeful that Schwarzenegger, who vetoed a similar takeout bill earlier this year, will sign the latest takeout legislation.

"Over the last 90 days we have worked with the governor's office to craft a bill which addresses the concerns expressed in the veto message," Horton said in a statement. "In no way should this bill be viewed as a piecemeal approach to the overall workers' compensation problem. Even with the workers' compensation reform legislation that recently passed, the California horse racing industry will still be paying premiums that are excessive compared to other industries and other racing jurisdictions.

"In the face of competition from other racing jurisdictions and gaming enterprises, it is essential for the racing industry to make a takeout adjustment to ensure its future as an agribusiness in California. This bill will help to restore California as a place where the best horses race and the best trainers and jockeys compete," Assemblymember Horton concluded.

In taking the earlier action, Schwarzenegger cited concerns over the governance of the fund, methods of distribution and the lack of further review of the necessity of the additional takeout in the future, issues addressed in the latest bill.

Officials have said the bill would significantly drop workers' comp insurance rates that are paid by owners and trainers. Horsemen, who currently pay $35 to $65 per $100 of payroll and $105 to $173 per jockey ride, could see their rates drop to $20 per $100 of payroll and $50 per mount.

The California Senate approved it on April 22 by a 31-6 vote.