California Gov. Gray Davis.

California Gov. Gray Davis.

Associated Press/ HO, Los Pinos

California Bill Signing Considered Major Step

California Gov. Gray Davis on Monday signed legislation that authorizes account wagering and calls for the unionization of backstretch workers at the state's racetracks.

The Thoroughbred Owners of California, in a press release, said the bill takes effect Jan. 1. California Horse Racing Board approval is necessary for in-state and out-of-state operators of account wagering systems.

TOC president John Van de Kamp said it could take "two to three years before we know the advantages and/or disadvantages of account wagering. While it has some upside potential for purses down the line, at the outset I look at this as a defensive mechanism to ward off offshore and out-of-state poachers so the California industry can retain for purses and commissions what is rightfully ours."

The governor vetoed similar legislation last year. Davis, in statement released after he signed the bill, said he took that action in 2000 because "federal law did not expressly permit the use of a telephone or the Internet to place wagers on horse races, thus, authorizing it in California would have represented a significant expansion of gambling beyond federal law." He also cited "the potential abuse by minors in using the Internet to place wagers."

Davis said two things changed since his veto: the Interstate Horseracing Act was amended to expand the definition of an "interstate off-track wager" to include Internet betting. In addition, the new bill contains "safeguards specifically designed to prohibit the use of advance-deposit wagering accounts by minors and other unauthorized persons."

Davis said the change in the Interstate Horseracing Act led California's attorney general to offer the opinion that California's bill is not an expansion of gambling. The change came about through pari-mutuel industry lobbying last year in Washington, D.C.

The governor's approval of the legislation was well-received by the Thoroughbred racing community.

"This shows the necessity of the entire racing community working closely together," said Wes Fitzpatrick, president of the California Thoroughbred Breeders Association. "This is legislation that can have a profound impact on many areas of our business."

"We understand there are risks involved with the cannibalization of the wagering dollar, however, there is a large potential for us to show growth in handle, which will boost both purses and incentive awards," said Doug Burge, CTBA executive vice president and general manager. "The television expansion potential can be a tremendous assist in exposing California horse racing to the general public."

Peter Tunney, vice president and general manager of the Magna Entertainment-owned Golden Gate Fields, said "passage of the bill is a triumph for the united effort by the racetracks, organized labor, and the horsemen."

The TV Games Network, which already has five exclusive partner racing associations in California -- Del Mar, Fairplex Park, Hollywood Park, Los Alamitos, and Oak Tree at Santa Anita Park -- is poised for growth in the state.

"This bill positions California as a leader in racing for decades to come, and all of us at TVG are excited about helping the California racing industry retain its position as one of the world's premier racing centers," said Mark Wilson, chief executive officer for TVG. "The governor's action and the virtually unanimous support this legislation had in the California Senate and Assembly were a product of the enormous
effort put forth by so many people who love this great sport. We are appreciative of that effort and look forward to a productive partnership with California racing."

One of the provisions in the labor portion of the bill says that if the majority of workers in a trainer's barn vote against union representation, the trainer will not be required to engage in collective bargaining.

Complete Text of Statement from Gov. Gray Davis