CHRB Approves Proposed Account Wagering Regs, Elects New Chair

Release from the California Horse Racing Board
The California Horse Racing board approved 15 proposed regulations for public notice Friday, setting the stage for account wagering to be in place in January after the proposed regulations pass through the administrative channels.

The seven racing commissioners also voted unanimously to elect Commissioner Alan Landsburg chairman and Commissioner Roger Licht vice chairman of the CHRB. Landsburg fills the post being vacated by Chairman Robert Tourtelot, who is completing nearly eight years of service on the board.

During an eventful meeting, a bare majority of the board approved a 2002 racing calendar for Northern California that restores six racing days to Bay Meadows. The board voted unanimously to restore one day to the Solano County Fair.

And following presentations by jockey Chris McCarron and Dr. L. Wayne Gertmenian, who is the current president of the Jockeys' Guild, the board approved a transfer of $680,180 from the uncashed pari-mutuel tickets fund to a trust account providing medical, vision, and dental benefits to nearly 150 active and retired California jockeys and their families.

Chairman Tourtelot began the meeting by requesting a "moment of silence for those taken during the tragic events of September 11."

The commissioners and staff have been working diligently with the industry and the public over the last month developing 30 pages of regulations covering all aspects of advance deposit wagering, which is authorized by a new law (AB 471) that takes effect January 1.

Licht, who chairs the CHRB Pari-Mutuel Operations Committee, spent countless hours communicating with the public, industry representatives, and the staff in helping to develop the proposed regulations. With CHRB senior management auditor John Reagan leading the team of staff members on this project, they began by obtaining and reviewing regulations from other states that already have such programs in place, then they painstakingly developed the proposed regulations for the California program.

The Pari-Mutuel Operations Committee conducted a public meeting Thursday focusing solely on account wagering. During several hours of discussion, Licht and the other two Committee members – Commissioners William Bianco and Landsburg – revised the language of some of the proposed regulations based on suggestions from the public and the industry.

Rodney Blonien, a Sacramento lobbyist familiar with the regulatory process, commended the staff for "doing such a first-rate job developing excellent regulations so quickly."

Licht publicly thanked the staff for "doing such a great job in a short period of time." He said he feels "very comfortable with the proposed regulations, considering that they've already been reviewed by all segments of the industry" and by some members of the public, and their input has been incorporated into the proposed regulations.

"I am confident that the industry as a whole and particularly the horsemen will benefit immensely from account wagering in California," said Licht.

The proposed regulations include the following key elements:

--Advance Deposit Wagering (ADW) means a form of pari-mutuel wagering in which an account holder residing within or outside California establishes an account and then authorizes a board-approved licensee, betting system, California hub, or out-of-state hub, by telephone or other electronic media, to place wagers on the account holder's behalf.

--In order to operate an ADW system, applicants must post a $500,000 bond or other financial security, which protects the betting pools and customers, and provide financial information demonstrating their financial resources to operate such a system; establish security access policies and safeguards; protect the confidentiality of account information; ensure that persons under 18 and other people prohibited from wagering at racetracks cannot open accounts; and include in their promotional literature contact information for a recognized problem-gambling support organization.

--All wagering transactions shall be recorded and retained for 180 days.

--The ADW wagers will be included in the respective pools at each racetrack.

--There will be no surcharge for any wager. The payoff for an account wager will be the same as an on-track mutuel (although the law does allow for transactional fees).

--Deposits can be made in cash or by credit card, check, electronic fund transfer, or other traditional means of deposit or payment. However, in their own best interests, applicants may instruct the operator not to accept deposits by credit card.

"Basically, we are protecting people from themselves by allowing them to opt out of credit card deposits," said Landsburg. "We also are limiting them to wager only with the funds that already are in the account and just one additional deposit or refill per racing day. There will be a 24-hour cooling-off period before they can wager with additional deposits or change their option not to use credit cards."

The proposed regulations do not address such matters as the number and location of races on which account holders may place wagers; whether individual racetracks will accept wagers from a single account wagering system or multiple systems; whether those systems will charge fees for each wagering transaction; or how the simulcasts of the races will be delivered to homes.

Jack Liebau, an executive with Magna Entertainment, which operates Santa Anita Park, Golden Gate Fields, and Bay Meadows, anticipates these matters being part of the contractual agreements between racetracks and the system operators.

Following the 45-day public notice period, the proposed regulations will come before the full board for a public hearing on November 30 at the University of California at Davis. The entire regulatory approval process should then be completed in January when the new law takes effect.

Continued. . . .