TITLE economic-regulation

Part I. Railroad Commission of Texas

Chapter 3. Oil and Gas Division

16 TAC §3.106

The Railroad Commission of Texas proposes new §3.106, relating to Sour Gas Pipeline Facility Construction Permits, to add procedures for the required permit for construction of a sour gas pipeline facility. The proposed new section sets forth the requirements germane to the sour gas pipeline permit process. Proposed new §3.106 defines terms; requires a permit to construct a sour gas pipeline facility and identifies those sour gas pipelines which will be exempted from the new rule; explains the permit application process; states those items which will be required for approval of the permit; establishes guidelines for filing protests; provides for hearings in certain circumstances; and establishes deadlines for processing applications.

The commission proposes this new section to facilitate implementation of House Bill 3194, 75th Legislature, Regular Session, 1997, which enacted Texas Civil Statutes, Article 6053-4, which requires an operator to obtain a commission permit before beginning construction of a sour gas pipeline facility.

Rita Percival, Planning and Administration, Oil and Gas Division, has determined that for each year of the first five years the proposed §3.106 is in effect there will be fiscal implications for state government as a result of enforcing or administering the proposed new section. It is not possible to determine in advance that the commission will or will not be required to conduct a hearing on an application for a sour gas pipeline facility permit or, if it does, what the fiscal impact on state government would be. However, should a hearing be required, the commission will use current staff and will not hire additional personnel for that purpose. For each year of the first five years the proposed amendments are in effect there will be no fiscal implications for local governments as a result of enforcing or administering the proposed section.

Rita Percival, Planning and Administration, Oil and Gas Division, also has determined that the public benefit anticipated as a result of enforcing the proposed new section will be improved compliance with statutory permitting requirements, a consistent opportunity for affected persons to have information about proposed sour gas pipeline facilities before they are constructed, and an opportunity for an administrative hearing if an affected person files a protest or if an unprotested application is denied. There are anticipated additional economic costs to small businesses and to individuals as a result of the proposed new section, but it is not possible to determine the amount or the impact of that cost.

All persons planning to construct a sour gas pipeline facility will be required to comply, at a minimum, with the requirement to publish notice of the proposed facility; the cost will vary depending on the location and the number of the counties in which notice is published. Some additional cost may be incurred due to the short, but calculable, delay built into the application process by H.B. 3194. Applicants will be required to wait at least 30 days from the date notice is first published to learn if there is a protest, in which case a hearing is mandatory.

Even in the absence of a protest, if the commission's designee declines to recommend approval of the application, the applicant may either amend the application to cure the defects or may request a hearing on the application as filed. The public benefit anticipated as a result of the proposed new section is greater flexibility for the commission in carrying out its mandate to ensure the safe operations of pipeline facilities in the State of Texas.

Comments on the proposed new rule should be submitted to Terri Eaton, Assistant Director, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Capitol Station, Austin, Texas 78711-2967. Comments will be accepted for 30 days following publication in the Texas Register . For additional information call Terri Eaton at (512) 463-6077 or Charles Ross at (512) 463-6829.

The commission proposes the new section under Texas Utilities Code, §§121.201-121.205 and Texas Natural Resources Code, §§117.001-117.101, which authorize the commission to adopt safety standards and practices applicable to the transportation of gas and hazardous liquids and all gas and hazardous liquid pipeline facilities within Texas to the maximum degree permissible under, and to take any other requisite action in accordance with, 49 U.S.C. §60101, et seq . (West 1998).

Texas Utilities Code, §§121.201-121.205, Texas Civil Statutes, Article 6053-4, and Texas Natural Resources Code, §§117.001-117.101 are affected by the proposed new section.

Issued in Austin, Texas, on July 27, 1999.

§3.106. Sour Gas Pipeline Facility Construction Permit.

(a)

Definitions. The following words and terms when used in this section shall have the following meanings, unless the context clearly indicates otherwise.

(1)

Affected person--The owner or occupant of real property located in the area of exposure of the proposed route of a sour gas pipeline facility. For purposes of this definition, the owner shall be the owner of record as of the final day to protest an application. The occupant shall be the occupant as of the final day to protest an application.

(2)

Applicant--A person who has filed an application for a permit to construct a sour gas pipeline facility, or a representative of that person.

(3)

Application--An Application for a Permit to Construct a Sour Gas Pipeline Facility, and all required attachments.

(4)

Area of exposure--The area within a set of circles constructed from each possible point of escape along a sour gas pipeline facility with a possible point of escape being the center of each circle and the radius of exposure being the radius of each circle.

(5)

Construction of a facility--Any activity conducted during the initial construction of a pipeline including the removal of earth, vegetation, or obstructions along the proposed pipeline right-of-way. The term does not include:

(A)

surveying or acquiring the right-of-way;

(B)

clearing the right-of-way with the consent of the owner;

(C)

repairing or maintaining an existing sour gas pipeline facility; or

(D)

installing valves or meters.

(6)

Extension of a sour gas pipeline facility--An addition to an operating sour gas pipeline facility regardless of ownership of the addition.

(7)

Nominal pipe size--The industry convention for naming pipe based on the approximate outer diameter. Six inch nominal size pipe corresponds to pipe with an outside diameter of six and five-eights inches. The inner diameter of six-inch nominal pipe varies based on the weight and grade of the pipe.

(8)

Person--An individual, partnership, firm, corporation, joint venture, trust, association, or any other business entity, a state agency or institution, county, municipality, school district, or other governmental subdivision.

(9)

Radius or radii of exposure--The 100 parts per million radius of exposure as calculated in §3.36(c)(1)-(3) of this title (relating to Oil, Gas, or Geothermal Resource Operation in Hydrogen Sulfide Areas) for the portion of the sour gas pipeline facility extending off the tract of production.

(10)

Sour gas pipeline facility--A pipeline and ancillary equipment that:

(A)

contains a concentration of 100 parts per million or more of hydrogen sulfide;

(B)

leaves the tract of production; and

(C)

is subject to the requirements of §3.36 of this title.

(11)

Tract of production--The surface area which overlies the strata from which oil, gas, or other minerals containing sour gas are produced if such area is treated by the Oil and Gas Division of the commission as a single tract.

(b)

Permit Required; Exceptions. No construction of a facility shall commence within this State without a permit if the facility is initially used as a sour gas pipeline facility except for the following:

(1)

an extension of an existing sour gas pipeline facility that at the time of construction of the extension is in compliance with §3.36 of this title, (relating to Oil, Gas, or Geothermal Resource Operation in Hydrogen Sulfide Areas) if:

(A)

the extension is not longer than five miles;

(B)

the nominal pipe size is not larger than six inches; and

(C)

the operator causes to be delivered to the Pipeline Safety Section, Gas Services Division, written notice of construction of the extension not later than 24 hours before the start of construction;

(2)

a new gathering system that operates at a working pressure of less than 50 pounds per square inch gauge;

(3)

an extension of a gathering system which operates at a working pressure of less than 50 pounds per square inch gauge;

(4)

an interstate gas pipeline facility, as defined by 49 U.S.C. §60101, that is used for the transportation of sour gas; or

(5)

replacement of all or part of a sour gas pipeline facility if the area of exposure of the replaced portion of the facility does not increase so as to include a public area, as defined in §3.36(b)(5) of this title, not included in the area of exposure of the portion of the replaced sour gas pipeline facility.

(c)

Filing and Assignment of Docket Number. Upon filing of an application with the Oil and Gas Division, staff will assign a docket number to the application and will notify the applicant of the assigned docket number. Thereafter, all documents relating to that application shall include the assigned docket number.

(d)

Application. A complete application consists of:

(1)

a properly completed application Form PS-79, with the original signature, in ink, of the applicant;

(2)

a plat which meets the requirements of subsection (f)(4) of this section and identifies the boundaries of surveys and blocks or sections as appropriate within the area of exposure;

(3)

a copy of the applicant's Application for Permit to Operate a Pipeline, Form T-4, if applicable, including all attachments;

(4)

a copy of the completed application for a Statewide Rule 36 Certificate of Compliance, Form H-9, including any attachment required under §3.36 of this title (relating to Oil, Gas, or Geothermal Resource Operation in Hydrogen Sulfide Areas); and

(5)

proof of notice evidenced as follows:

(A)

a receipt from each county clerk with whom an application form and plat is required to be filed pursuant to subsection (e)(1) of this section; and

(B)

the full page(s) of the newspaper containing the published notice required under subsection (e)(2) of this section including the name of the paper, the date the notice was published, and the page number.

(e)

Notice. For each county that contains all or part of the proposed route of a sour gas pipeline facility, the applicant shall:

(1)

cause to be delivered to the county clerk no later than the first date of publication in that county a copy of the items described in subsection (d)(1)-(3) of this section;

(2)

publish notice of its application in a newspaper of general circulation in each county that contains all or a portion of the route of the proposed sour gas pipeline. Such notice shall meet the requirements of subsection (f) of this section and be published in a section of the newspaper containing news items of state or local interest.

(f)

The published notice of application shall be at least three inches by five inches in size, exclusive of the plat, and shall contain the following:

(1)

the name, business address, and telephone number of the applicant and of the applicant's authorized representative, if any;

(2)

a description of the geographic location of the sour gas pipeline facility and the length of the radius of exposure, to the extent not clearly identified in the plat required to be published in subsection (f)(4) of this section;

(3)

the following statement, completed as appropriate: This proposed pipeline facility will transport sour gas that contains 100 parts per million, or more, of hydrogen sulfide. A copy of application forms and a map showing the location of the pipeline is available for public inspection at the offices of the (insert County name) County Clerk, located at the following address: (insert address of county clerk). Any owner or occupant of land located within the 100 ppm radius of exposure of the proposed sour gas pipeline facility desiring to protest this application can do so by mailing or otherwise delivering a letter referring to Docket Number (insert docket number) and stating their desire to protest to: Docket Services, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967. Protests shall be in writing received by Docket Services not later than (specify 30th day after the first date notice of the application is to be published). The letter shall include the name, address, and telephone number of every person on whose behalf the protest is filed and shall state the reasons each such person believes that he or she is the owner or occupant of property within the area of exposure of the proposed pipeline facility. It is recommended that a copy of this notice be included with the letter; and

(4)

a plat identifying:

(A)

the location of the pipeline facility;

(B)

area of exposure;

(C)

compass;

(D)

scale;

(E)

geographic subdivisions appropriate for the scale; and

(F)

by inset or otherwise, landmarks or other features such as roads and highways in relation to the proposed route of the sour gas pipeline. These landmarks or other features shall be of sufficient detail to allow a reasonable individual to ascertain whether he or she is likely to own or occupy property that is within the area of exposure of the proposed sour gas pipeline. Examples of acceptable plats are included in this subsection as Figures 1 and 2.

Figure 1: 16 TAC §3.106(f)(4)

Figure 2: 16 TAC §3.106(f)(4)

(g)

Protests. Affected persons have standing to file a protest to an application. All such protests shall:

(1)

be in writing and filed at the commission no later than the 30th day after the notice is published in a newspaper in the county in which the person filing the protest owns or occupies real property;

(2)

identify the docket number of the application being protested;

(3)

state the name, address, and telephone number of every person on whose behalf the protest is being filed; and

(4)

include a statement of the facts on which the person filing the protest relies to conclude that each person on whose behalf the protest is being filed is an affected person, as defined in subsection (a)(1) of this section.

(h)

Division Review.

(1)

Within 14 days of receipt of the application, the commission's designee will provide written notice to the applicant that the application is either complete and accepted for filing, or incomplete and specify the additional information required for acceptance. The application must be completed within 30 days of notification that the application is incomplete or such longer time as may be requested by the applicant, in writing, and approved by the commission's designee. If the application is not completed within the specified time period, the commission's designee shall send notice of intent to deny the application to the applicant. Within ten days of issuance of a notice of intent to deny the application for failure to complete the application, the applicant may request a hearing on the application as it exists at that time. If a request for hearing is not filed within ten days of issuance of a notice of intent to deny the application for failure to complete the application, the application shall be dismissed without prejudice by the commission's designee.

(2)

The commission's designee shall make a written recommendation as to whether the materials to be used in and method of construction and operation of a proposed sour gas pipeline facility comply with the rules and safety standards of the commission if the application is not protested, by the latter of the 14th day after the end of the 30-day protest period or the 14th day after the day notice of a complete application is issued.

(3)

If, pursuant to subsection (i) of this section, a hearing is held the staff may introduce evidence relating to the materials to be used in and method of construction and operation of a proposed sour gas pipeline facility.

(4)

In determining whether or not the materials to be used in and method of construction and operation of a proposed sour gas pipeline facility comply with the rules and safety standards of the commission, relevant provisions of §3.36 and §3.65 of this title (relating to Oil, Gas, or Geothermal Resource Operation in Hydrogen Sulfide Areas, and Pipeline Permits Required, respectively) shall be considered. And, if applicable, §§7.70-7.73 of this title (relating to Natural Gas Pipeline Safety Rules) and §§7.80-7.87 of this title (relating to Hazardous Liquids Pipeline Safety Rules) shall also be considered.

(5)

If no affected person files a protest with the commission by the 30th day after publication of notice of application was published, the commission's designee shall either make a written recommendation that the permit be issued, that the permit be conditionally granted, or that the permit be denied. If the commission's designee recommends that the permit be conditionally granted or be denied, the reasons for such recommendation shall be explained. If the commission's designee recommends that the application be conditionally granted or be denied, the applicant shall have a right to a hearing upon written request received no later than 15 days after the date of issuance of notice of conditional grant or denial.

(i)

Hearing.

(1)

A hearing shall be convened to consider an application for a sour gas pipeline construction permit if:

(A)

a protest is timely filed by an affected person;

(B)

a request is timely filed by an applicant; or

(C)

the commission so elects on its own motion.

(2)

The Office of General Counsel shall assign an examiner who shall conduct a hearing in accordance with the procedural requirements of Texas Government Code, Chapter 2001 (the Administrative Procedure Act), and Chapter 1 of this title (relating to the General Rules of Practice and Procedure).

(3)

The commission shall convene a hearing not later than the 60th day after a protest is filed, the applicant submits a request for hearing, or the commission gives notice of intent to convene a hearing on its own motion. If the application is not complete as of the date the request for hearing is filed or notice of hearing issued, the 60-day time period for convening a hearing shall not begin to run until such time as notice of a complete application is issued unless the hearing is held pursuant to the provisions of subsection (h)(1) of this section. If the hearing is held pursuant to the provisions of subsection (h)(1), the hearing will be held within 60 days of receipt of a request for hearing.

(4)

In any hearing convened to consider an application, the applicant has the burden of showing that the materials to be used in and method of construction and operation comply with the applicable rules and safety standards adopted by the commission.

(j)

Order.

(1)

An order approving an application shall include a finding that the materials to be used in and method of construction and operation of the facility comply with the applicable rules and safety standards adopted by the commission. The order shall also grant the permit required under §3.65 of this title (Rule 70, Relating to Pipeline Permits Required).

(2)

An order denying an application shall state the reason or reasons for the denial.

(3)

In the case of an application for which a hearing is conducted, the commission will render a decision not later than the 60th day after the date on which the hearing is finally closed.

(4)

If no hearing is held on an application, the commission will render a decision not later than the 60th day after the staff prepares its written recommendation in accordance with subsection (h) (2)(A) and (h)(4) of this section.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on July 28, 1999.

TRD-9904534

Mary Ross McDonald

Deputy General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: September 12, 1999

For further information, please call: (512) 463-7008


Chapter 9. Liquefied Petroleum Gas Division

Subchapter A. General Applicability and Requirements

16 TAC §9.9

The Railroad Commission of Texas proposes new §9.9, concerning reciprocal examination agreements with other states. The commission proposes this action to implement a provision in House Bill 1226, passed by the 74th legislature and effective September 1, 1995, and codified at Texas Natural Resources Code, §113.095, which allows the commission by rule to develop reciprocal agreements with other states regarding examination requirements.

Proposed new §9.9 describes the process by which other states with substantially equivalent examination requirements may enter into a reciprocal agreement with Texas. The proposed rule also outlines procedures for individuals in participating states who wish to obtain a reciprocal examination exemption. The proposed rule limits reciprocal agreements to LP-gas transport driver examinations at this time, but may be expanded in future rulemakings to include other types of licenses and examinations.

Thomas D. Petru, Assistant Director, LP-Gas Section, Gas Services Division, has determined that, for each year of the first five years that the section is proposed to be in effect, there will be some fiscal implications for state government which will be offset to some extent by having each participating state retain its own fee structure regarding examination and other applicable fees. For example, applicants from other states requesting a reciprocal examination exemption in Texas will still be required to pay the examination fee and the annual recertification fee, which are currently $10 and $25, respectively. (In a subsequent rulemaking, the commission will be considering increasing the $10 examination fee.) Maintaining the commission's fee structure will ensure stability in the commission's budget projections and expenditures; applicants for reciprocal examination exemptions will not be required to take the examinations, but the commission will still expend employee time and related costs in order to process the applications. Likewise, Texas LP-gas employees who request reciprocal examination exemptions from another state will be required to pay whatever fees the other state prescribes. There will be no fiscal implications for local governments.

Mr. Petru has also determined that, for each year of the first five years the section is proposed to be in effect, public benefit is anticipated as a result of enforcing the section as proposed. The public benefit will be increased access to equally qualified LP-gas industry personnel, especially in areas of Texas which border other states or for companies which do business in several states. The benefit for Texas LP-gas industry personnel will be the opportunity to expand their businesses into other states.

There is an anticipated economic cost to individuals or small businesses required to comply with the proposed new section. The cost will be the examination and other fees required by states which participate in the reciprocal agreement with Texas. Since these fees are different in each state and are subject to change, the exact anticipated economic cost cannot be determined. However, as part of the reciprocal agreement, the commission will make available to Texas applicants the specific requirements from other states as they enter into a reciprocal agreement with Texas. The commission will also require, as part of the reciprocal agreement, that the participating states notify the commission any time there is a change in their licensing, examination, or fee requirements.

Comments on the proposal may be submitted to Kellie Martinec, Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967. Comments will be accepted for 30 days after publication in the Texas Register and should refer to LP-Gas Docket No. 1483. For more information, call Thomas D. Petru at (512) 463-6949.

The new section is proposed under the Texas Natural Resources Code, §113.051, which authorizes the commission to adopt rules relating to any and all aspects or phases of the LP-gas industry that will protect or tend to protect the health, welfare, and safety of the general public, and §113.095, which authorizes the commission to adopt rules waiving the examination requirements for applicants from other states which have certification requirements substantially equivalent to those in Texas.

Two sections of the Texas Natural Resources Code, §113.051 and §113.095, are affected by the proposed new section.

§9.9.Reciprocal Examination Agreements with Other States.

(a)

The commission may accept the examination requirements for LP-gas employees from other states provided that each state has entered into a reciprocal agreement with Texas as specified in this section.

(b)

A state that is interested in a reciprocal agreement with Texas shall submit a copy of its examination to the LP-Gas Section, Gas Services Division, of the Railroad Commission of Texas. The LP-Gas Section will submit a copy of the Texas examination to the other state's LP-gas authority. The states will review the materials to ensure that they contain substantially equivalent requirements. If each state accepts the requirements of the other state, both states shall sign the reciprocal agreement.

(1)

The reciprocal agreement shall be in the form of a letter on the official letterhead of the state requesting the reciprocal agreement. The letter shall be signed and dated by an official representative of the LP-gas authority in both states. For Texas, the official representative shall be the assistant director of the LP-Gas Section, Gas Services Division, Railroad Commission of Texas, or the assistant director's designee.

(2)

The reciprocal agreement shall remain in effect until either state requests a change and may be terminated by either state at any time.

(3)

If either state revises its examination or related requirements, it shall immediately notify the other state by submitting the revised examination or related requirements.

(4)

The LP-Gas Section shall maintain a current list of all states participating in reciprocal agreements, a list of participating states' applicable fees, and a list of all individuals who have received a reciprocal examination exemption.

(5)

The LP-Gas Section shall be permitted to inspect all existing available examinations from other participating states for the purpose of establishing equivalency of the examinations. Copies of examinations from other participating states are subject to or excepted from required disclosure in accordance with Chapter 552 of the Government Code.

(c)

Individuals who apply for a reciprocal examination exemption shall pay the applicable fees required by each state in exchange for exemption from examination requirements.

(1)

Individuals from other participating states shall pay the examination fee and the annual recertification fee to the Railroad Commission as specified in §9.4 of this title (concerning licenses and related fees).

(2)

Individuals from Texas who apply for a reciprocal examination exemption in other states shall pay to the other state any fees specified by that state.

(d)

Applicants for a reciprocal examination exemption shall provide written proof to the LP-Gas Section that they are properly and currently certified in their state.

(1)

The written proof shall be a state-issued certification card, license, letter, or similar document which shall clearly show a valid date and an indication that the individual passed the examination. Maintaining valid certification in the other state is required for continuing reciprocity in Texas.

(2)

Applicants from other states shall provide their Social Security numbers to the LP-Gas Section for purposes of record- keeping and to comply with the requirements in Tex. Fam. Code Ann. §231.302(c) (Vernon 1996), which mandates disclosure of Social Security numbers by applicants to assist in the administration of laws relating to child support. Social Security numbers are subject to or excepted from disclosure to the public in accordance with Tex. Gov't Code, Chapter 552.

(3)

Texas applicants shall provide copies of their Commission- issued wallet certification cards showing their annual certification as their written proof when applying to other states for reciprocal examination exemptions.

(e)

Individuals from other states who apply for a reciprocal examination exemption from Texas shall either be employed by a company that is properly and currently licensed in Texas or shall themselves fulfill all other licensing requirements in the LP-Gas Safety Rules .

(f)

Individuals who obtain reciprocal examination exemptions are liable under the laws and rules of the state in which they perform the LP-gas activities.

(1)

Each state shall be responsible for its own enforcement actions against individuals with reciprocal examination exemptions.

(2)

If a participating state has an enforcement action against an individual with a reciprocal examination exemption, that state shall inform the other state within 14 calendar days of initiating the action.

(3)

A state may suspend, revoke, or deny a reciprocity renewal or an individual's reciprocal examination exemption, as specified in §9.7 of this title (relating to denial, suspension, or revocations of licenses or certificates, and hearings) and shall notify the other state and all individuals holding the reciprocal examination exemption within 14 calendar days of such suspension, revocation, or denial.

(g)

Upon the effective date of this section, the commission may issue reciprocal examination exemptions only for LP-gas transport driver examinations. For purposes of reciprocal agreements, a "transport" is defined as a semi-trailer.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on July 27, 1999.

TRD-9904513

Mary Ross McDonald

Deputy General Counsel, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: September 12, 1999

For further information, please call: (512) 463-7008


Part VIII. Texas Racing Commission

Chapter 305. Licenses for Pari-Mutuel Racing

The Texas Racing Commission proposes the repeal of Chapter 305, §§305.1-305.11, 305.13, 305.14, 305.31, 305.33-305.37, 305.41-305.51, 305.61-305.65, 305.67, 305.69, 305.81-305.87, 305.91, 305.101-305.103, 305.105-305.107, 305.121-305.128, 305.141, 305.143-305.152, 305.161-305.163, 305.165-305.168, 305.181, 305.182, 305.184-305.191, 305.201-305.205, 305.221-305.223, 305.225, 305.226, 305.241-305.250, 305.261, 305.262, 305.301, relating to licenses for pari-mutuel racing in conjunction with its review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, Section 55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, Section 167 (167). Such reviews shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of these three chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees. It is proposed that Chapter 305 be repealed. The sections in Chapter 305 relating to the licensing and operations of racetracks will be incorporated into the new Chapter 309. The sections in Chapter 305 relating to the licensing and regulation of occupational licensees will be incorporated into the new Chapter 311. In addition, §305.55 and §305.56, dealing with the hearing process for racetrack license applicants will be moved to Chapter 307 and §305.46, dealing with totalisator systems, will be moved to Chapter 321.

As part of the reorganization of the Commission rules, the agency is complying with the Section 167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the rules are repealed there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the rules are repealed the public benefit anticipated as a result of enforcing the proposal will be that the public and licensees will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. There will be no fiscal implications for small businesses and micro- businesses as a result of enforcing this repeal. There is no anticipated economic cost to an individual required to comply with the repeal as proposed. The proposal has no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

Subchapter A. General Provisions

16 TAC §§305.1-305.11, 305.13, 305.14

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.1. Applicability.

§305.2. License Required.

§305.3. Application Forms.

§305.4.Application Site.

§305.5. Fingerprints.

§305.6. Fees.

§305.7.Duration of License.

§305.8.License Not Transferable.

§305.9. License Condition.

§305.10. Security for Compliance.

§305.11.Criminal History Record.

§305.13.Effect of Acceptance.

§305.14.Denial.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904654

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter B. Individual Licenses

1. General Provisions

16 TAC §§305.31, 305.33-305.37

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.31.Applicability.

§305.33. License Badge.

§305.34.Education.

§305.35.Occupational Licensing Categories and Fees.

§305.36. Examinations.

§305.37.Restrictions on Licensing.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904655

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Specific Licenses

16 TAC §§305.41-305.51

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.41.Veterinarians.

§305.42.Owners.

§ 305.43. Lessee/Lessor.

§305.44. Trainer or Assistant Trainer.

§ 305.45. Authorized Agent.

§ 305.46. Totalisator Systems.

§305.47. Jockeys.

§305.48. Apprentice Jockeys.

§305.49. Emergency License.

§305.50.Mutuel Employees.

§305.51. Leadout.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904656

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter C. Racetrack Licenses

1. General Provisions

16 TAC §§305.61-305.65, 305.67 and 305.69

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.61. Applicability.

§305.62.Criteria and Burden of Proof.

§305.63.License Certificate.

§305.64.Restrictions on Eligibility.

§305.65.Lease.

§305.67.Reasonable Diligence Required.

§305.69.Horse Racetrack Application and Initial License Fees.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904657

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Application Procedure

16 TAC §§305.81-305.87, 305.91

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.81.Application.

§305.82.Application Process.

§305.83. Application Documents.

§305.84.Type of Documents Required.

§305.85.Review of Application Documents and Certification of Receipt.

§305.86.Hearings.

§305.87.Prepared Testimony.

§305.91.Changes in Application.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904658

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


3. Background Information

16 TAC §§305.101-305.103, 305.105-305.107

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.101.Personal Information.

§305.102.Residency.

§305.103.Information for Department of Public Safety Background Investigation.

§305.105.Consent for Investigation.

§305.106.Waiver.

§305.107.Consultants.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904659

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


4. Ownership

16 TAC §§305.121-305.128

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.121.Name and Address.

§305.122.Business Structure.

§305.123.Organizers.

§305.124.Organizational Documents.

§305.125.Owners.

§305.126.Directors, Officers, and Partners.

§305.127.Controlling Entity.

§305.128.Outside Interests.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904660

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


5. Site and Facilities

16 TAC §§305.141, 305.143-305.152

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.141.Location.

§305.143.Zoning and Governmental Improvements.

§305.144.Defects.

§305.145. Access and Transportation.

§305.146.Architect's Plan.

§305.147.Track Dimensions.

§305.148.Public Areas.

§305.149.Parking Facilities.

§305.150.Facilities for Animals and Personnel.

§305.151.Utilities and Easements.

§305.152.Exemptions from Rules.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904661

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


6. Financing

16 TAC §§305.161-305.163, 305.165-305.168

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.161.Fiscal Information.

§305.162.Loans.

§305.163.Debt.

§305.165.Budget.

§305.166.Time Schedule.

§305.167.Funding.

§305.168.Financial Forecasts.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904662

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


7. Operations

16 TAC §§305.181, 305.182, 305.184-305.191

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.181.Race Meetings.

§305.182.Management.

§305.184.Concessions.

§305.185.Pari-mutuel Operations.

§305.186.Operations Contracts.

§305.187.Out of State Distributions.

§305.188.Racing Equipment.

§305.189.Animal Health and Safety.

§305.190.Purse Structure.

§305.191.First Aid and Safety Monitoring.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904663

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


8. Economic and Social Projections

16 TAC §§305.201-305.205

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.201.Demographic Information.

§305.202.Economic Information and Projection.

§305.203.Projection of Competition.

§305.204.Social Information.

§305.205.Impact on Breeding Industry.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904664

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


9. Safety and Security

16 TAC §§305.221-305.223, 305.225, 305.226

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.221.Security Documents.

§305.222.Local Emergency Services.

§305.223.Security for Facilities.

§305.225.Security Personnel.

§305.226.Fire Safety and Emergency Procedures.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904665

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter D. Suspension and Revocation of Licenses

16 TAC §§305.241-305.250

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.241.Applicability.

§305.242.Violations or Convictions.

§305.243.Qualifications and Character.

§305.244.Failure to Disclose.

§305.245.Use of License.

§305.246.Domicile.

§305.247.Debt or Liens.

§305.248.Ejection.

§305.249.Racetrack License.

§305.250.Detrimental Practices.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904666

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter E. Renewal of Licenses

16 TAC §305.261, §305.262

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.261.Application.

§305.262.Terms of License.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904667

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter F. Other Licenses

16 TAC §305.301

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§305.301.Interim License to Conduct Race Meetings.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904711

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Chapter 307. Practice and Procedures

Subchapter B. Adjudicative Procedures

1. General Provisions

16 TAC §307.55, §307.56

The Texas Racing Commission proposes the new §307.55 and §307.56 relating to the procedures for racetrack license application hearings. These two new rule sections are proposed in conjunction with the agency's review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, Section 55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, Section 167 (167). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees.

As part of the reorganization of the Commission rules, the agency is complying with the Section 167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Two sections in Chapter 305 relate to the procedures for racetrack license application hearings. It is determined that the reason for these two sections still exist. Therefore, they are being incorporated into Chapter 307, which relates to the practice and procedures for adjucative hearings. Former §305.86 will be renumbered§307.55. Former §305.87 will be numbered as §307.56.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rules are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §6.06 which authorizes the Commission to adopt rules regarding racetrack license applications; and Tex. Gov't Code, §2001.004, which requires the commission to adopt rules of practice and procedure.

The proposal implements Texas Civil Statutes, Article 179e.

§307.55.Racetrack License Applications Hearings.

For each application, at the discretion of the executive secretary, the commission may conduct a hearing in accordance with this chapter. For each application the commission proposes should be denied, the commission shall conduct a hearing in accordance with this chapter.

§307.56.Prepared Testimony for Racetrack License Applications Hearings.

(a)

Each party participating in a racetrack license application hearing shall file written prepared testimony for all persons the party will call as witnesses in the hearing. In addition to the filing requirements of the State Office of Administrative Hearings, each party must file five copies of the prepared testimony and all attachments with the commission.

(b)

An applicant for a racetrack license must file prepared testimony not later than 21 days before the date set for the hearing on the application or on the date ordered by the administrative law judge. All other parties must file prepared testimony not later than 7 days before the date set for the hearing on the application or on the date ordered by the administrative law judge.

(c)

By order of the administrative law judge, an applicant may be authorized to file prepared rebuttal testimony prior to the date set for the hearing. Prepared rebuttal testimony which responds to concerns or recommendations regarding the application raised by commission staff or any other party to the application proceeding is not considered a change in application as specified in §309.3(e) of this title (relating to Racetrack License Application Procedure).

(d)

The prepared testimony must be in printed or typewritten form on 8 1/2 by 11 inch paper. The applicant must attach to the prepared testimony of each witness the portions of the application that the witness is identifying or sponsoring.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on August 2, 1999.

TRD-9904698

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Chapter 309. Operation of Racetracks

The Texas Racing Commission proposes the repeal of Chapter 309 relating to the operations of racetracks in conjunction with its review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, §55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (section). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees. It is proposed that Chapter 309 be repealed and replaced with a new Chapter 309 which will regulate the licensing and operations of horse and greyhound racetracks. The sections in Chapter 305 relating to the licensing and operations of racetracks will be incorporated into the new Chapter 309.

As part of the reorganization of the Commission rules, the agency is complying with the §167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the rules are repealed there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the rules are repealed the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. There will be no fiscal implications for small businesses and micro-businesses as a result of enforcing this repeal. There is no anticipated economic cost to an individual required to comply with the repeal as proposed. The proposal has no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

Subchapter A. General Provisions

1. General Provisions

16 TAC §§309.1-309.4

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeals are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.1. Duty of Association.

§309.2. Exemption.

§309.3. Construction and Renovation of Racetrack Facilities.

§309.4. Compliance Inspections.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904671

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Earliest possible date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Facilities and Equipment

16 TAC §§309.11-309.35

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.11. Applicability.

§309.12. Comfort and Safety.

§309.13. Maintenance.

§309.14. Accessibility by Disabled Persons.

§309.15. Restrooms.

§309.16. Refreshments.

§309.17. Complaints.

§309.18. First Aid.

§309.19. Regulatory Office Space and Equipment.

§309.20. Continuing Education.

§309.21. Recreational Facilities.

§309.22. Parking for Licensees.

§309.23. Eating Facilities.

§309.24. Medical Services.

§309.25. External Communication.

§309.26. Internal Communication System.

§309.27. Public Address System.

§309.28. Photofinish Equipment.

§309.29. Videotape Equipment.

§309.30. Maintenance of Negatives and Videotapes.

§309.31. Lighting.

§309.32. Automatic Banking Machines.

§309.33. Attendance.

§309.34. Breathalyzer Machine.

§309.35. Approval of Equipment.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904672

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


3. Operations

16 TAC §§309.51-309.63, 309.65, 309.66, 309.68-309.72

(Editor's note: The text of the following sections proposed for repeal will not be published. The section may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.51. Contracts.

§309.52. Change of Ownership, Board of Directors, or Management Committee.

§309.53. Records.

§309.54. General Security.

§309.55. Stable or Kennel Area.

§309.56. Stable/Kennel Area Visitors Pass.

§309.57. Incident Report.

§309.58. Fire Prevention.

§309.59. Insect Control.

§309.60. Alcoholic Beverages.

§309.61. Vendors.

§309.62. Racing at Designated Place.

§309.63. Approval of Management, Totalisator Companies, and Concessionaires.

§309.65. Certain Loans Prohibited.

§309.66. Fingerprinting.

§309.68. Accounting Practices.

§309.69. Records of Accidents.

§309.70. Cooperation with Commission.

§309.71. Race Information.

§309.72. Organizational Chart.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904673

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter B. Horse Racetracks

1. Racetracks

16 TAC §§309.101-309.108, 309.110-309.117

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.101. Applicability.

§309.102. Track Length.

§309.103. Track Width.

§309.104. Elevation.

§309.105. Surface of Track.

§309.106. Drainage.

§309.107. Rails.

§309.108. Maintenance of Track.

§309.110. Gates.

§309.111. Turf Access Path.

§309.112. Lighting.

§309.113. Obstacles.

§309.114. Official's Stands.

§309.115. Starting Gates.

§309.116. Distance Markers.

§309.117. Survey.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904674

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Facilities for Horses

16 TAC §§309.141-309.155

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.141. Barns.

§309.142. Receiving Barn.

§309.143. Stalls.

§309.144. Tack Room.

§309.145. Stakes Barn.

§309.146. Manure Removal.

§309.147. Hay and Feed Storage.

§309.148. Maintenance of Common Areas.

§309.149. Pre-race Holding Area.

§309.150. Paddock.

§309.151. Test Barn.

§309. 152. Isolation Area.

§309.153. Treatment Area.

§309.154. Postmortem.

§309.155. Equine Ambulance.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904675

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


3. Facilities for Employees

16 TAC §§309.181-309.184

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commissioner in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.181. Commission Veterinarian's Office.

§309.182. Jockeys.

§309.183. Living Quarters for Employees.

§309.184. Pets.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904676

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


4. Operations

16 TAC §§309.191-309.202

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.191. Racing Hours.

§309.192. Number of Races.

§309.193. Saddle Cloth.

§309.194. Helmets.

§309.195. Starting Crew.

§309.196. Traffic in Stable Area.

§309.197. Condition Book.

§309.198. Official Program.

§309.199. Purse Accounts.

§309.200. Stakes and other Prepayment Races.

§309.201. Equitable Stabling.

§309.202. Horsemen's Representative.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904677

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter C. Greyhound Racetracks

1. Facilities and Equipment

16 TAC §§309.301-309.316

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.301. Applicability.

§309.302. Track Specifications.

§309.303. Track Surface.

§309.304. Watering Equipment.

§309.305. Starting Boxes.

§309.306. Escapes.

§309.307. Lures.

§309.308. Video Monitoring System.

§309.309. Lockout Kennel.

§309.310. Walkway.

§309.311. Kennel Compound.

§309.312. Turnout Pens.

§309.313. Kennel Buildings.

§309.314. Sprint Path.

§309.315. Test Area.

§309.316. Emergency Care Facility.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904678

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Operations

16 TAC §§309.351-309.365

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.351. Kennel Contracts.

§309.352. Texas Preference.

§309.353. Dismissal of Kennel.

§309.354. Stakes Entry.

§309.355. Grading System.

§309.356. Draw and Post Position Assignment.

§309.357. Schooling.

§309.358. Racing Restricted.

§309.359. Live Lures.

§309.360. Educational Opportunities.

§309.361. Marathons.

§309.362. Kennel Account.

§309.363. Number of Greyhounds.

§309.364. Official Program.

§309.365. Identification System.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904679

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter D. Totalisator Operations

1. Mutuel Facilities

16 TAC §§309.401-309.407

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.401. Totalisators.

§309.402. Locking Devices.

§309.403. Stop Betting Command.

§309.404. Final Confirmation.

§309.405. Security for Totalisator Equipment.

§309.406. Access to Tote Room.

§309.407. Work Area for Pari-mutuel Auditors.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904680

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Totalisator System Requirements

16 TAC §§309.421-309.437

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.421. Redundant Capabilities.

§309.422. Record of Stop Betting Command.

§309.423. Odds.

§309.424. Odds Board Control.

§309.425. Retention of Racing Performance Data.

§309.426. Magnetic Tapes.

§309.427. Summary.

§309.428. Unique Ticket Number.

§309.429. Outstanding Tickets.

§309.430. Computer-Produced Reports.

§309.431. System Log.

§309.432. Security Subsystem.

§309.433. Access to Subsystems.

§309.434. Power Fluctuations.

§309.435. Comparison of Pool Totals.

§309.436. Loss of Communication Reports.

§309.437. Waivers for Scientific Advancements.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904681

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


3. Totalisator Operational Requirements

16 TAC §§309.451-309.463

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§309.451. Pre-race Tests.

§309.452. Totalisator Computer Programs.

§309.453. Duplicates of Programs.

§309.454. Notice of Modification.

§309.455. Console Log.

§309.456. Control of System Use.

§309.457. Reports.

§309.458. Maintenance of Tapes.

§309.459. Access to Computer Equipment.

§309.460. Security Devices.

§309.461. Back-up Procedure.

§309.462. Alternate Power Source.

§309.463. Shut-down Procedure.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904682

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Chapter 309. Racetrack Licenses and Operations

The Texas Racing Commission proposes the new Chapter 309, relating to the operations of racetracks in conjunction with its review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, Section 55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, Section 167 (167). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees. This new proposed Chapter 309 will regulate the licensing and operations of horse and greyhound racetracks. The sections in Chapter 305 relating to the licensing and operations of racetracks will be incorporated into the new Chapter 309.

As part of the reorganization of the Commission rules, the agency is complying with the Section 167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding. To assist in the review of new Chapter 309, a derivative table and disposition table may be requested from the Commission. These tables will show whether an old rule has been amended, repealed or merely renumbered and the derivation of the new rules.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rules are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

Subchapter A. Racetrack Licenses

16 TAC §§309.1-309.9

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §3.07, which authorizes the commission to impose a fee to offset the costs of compensating officials and to set the amount of the compensation by rule; §5.01, which authorizes the commission to prescribe reasonable license fees for each category of license; §5.03, which authorizes the commission to obtain fingerprints from license applicants; §5.04, which describes the requirements relating to the release of criminal history information; §6.03, which authorizes the commission to prescribe forms for racetrack applications and to establish an application fee; §6.031, which describes the requirements for a background check for racetrack license applicants; §6.06 which authorizes the Commission to adopt rules regarding racetrack license applications; §6.18, which authorizes the Commission to suspend or revoke licenses and to prescribe reasonable annual fees to be paid by racetrack licensees; and §14.18, which authorizes the Commission to perform administrative searches at licensed racetracks and adopt rules regarding such searches and seizures.

The proposal implements Texas Civil Statutes, Article 179e.

§309.1.Racetrack Licenses.

(a)

Required.

(1)

A person may not conduct a race meeting at which pari-mutuel wagering is conducted unless the person has a valid license to conduct a race meeting issued by the Commission.

(2)

A licensee may not employ a person to work at a racetrack at which pari-mutuel wagering is conducted unless the person has a valid license issued by the Commission.

(3)

The Commission shall issue a license in the form of a Commission Order to each association granted a license to operate a racetrack with pari- mutuel wagering.

(b)

Duration of License. A racetrack license is perpetual.

(c)

Conditions.

(1)

Except as otherwise provided by this section, a license issued by the Commission is a privilege, not a right, and is conditioned on the licensee's compliance with the Act and the Rules.

(2)

If the Act or a rule is amended, the continued holding of a license is conditioned on the licensee's compliance with the Act or rule as amended.

(d)

Effect of Acceptance. By accepting a license issued by the Commission, a person consents to:

(1)

a search by the Commission of the association grounds and possessions located on association grounds to check for violations of the Act or the Rules; and

(2)

seizure of contraband.

§309.2.Criteria.

(a)

Consistent with the Texas Racing Act which prohibits the Commission from granting more than three Class 1 horse racetrack licenses and which requires the Class 1 racetracks to be located only in counties with a population of 750,000 or more or in a county adjacent to such a county, the Commission determines that only one Class 1 horse racetrack license will be granted for each eligible geographical area. No more than one Class 1 racetrack may be located in a county.

(b)

Consistent with the Texas Racing Act which prohibits the Commission from granting more than three greyhound racetrack licenses and which requires the greyhound racetracks to be located only in counties with a population of 190,000 or more and with all or part of an island that borders the Gulf of Mexico, the Commission determines that only one greyhound racetrack license will be granted for each eligible geographical area.

(c)

If the Commission receives more than one application for a Class 1 or greyhound racetrack license for an eligible geographical area, the Commission may:

(1)

refuse to grant a license to any of the applicants; or

(2)

grant the license to the applicant which, in the sole judgment and discretion of the Commission, will be in the best interest of racing and the public.

(d)

This subsection applies to a racetrack licensing proceeding regarding a Class 1 racetrack that has been constructed, the ownership of or a leasehold interest in which has been sold or transferred pursuant to the foreclosure of liens or the enforcement of an agreement securing the original financing for the racetrack (or any refinancing thereof) or otherwise transferred in lieu of foreclosure or enforcement of the debt holder's rights. The Commission shall grant a new Class 1 license for a racetrack to which this subsection applies as expeditiously as possible consistent with the Commission's duty to ensure the integrity of pari-mutuel racing.

§309.3.Racetrack License Application Procedure.

(a)

General Requirements.

(1)

To apply for a license to operate a racetrack, a person must:

(A)

provide to the Commission all the information requested on the form prescribed by the executive secretary;

(B)

submit to the Commission all additional documents required by the application and this subchapter; and

(C)

pay an application fee to the Commission.

(2)

An applicant for a racetrack license must submit the application, all additional documents required by the application and the application fee to the main office of the Commission in Austin.

(b)

Application Process.

(1)

From time to time, the Commission shall designate an application period not to exceed 60 days, during which the Commission shall accept application documents.

(2)

The Commission shall specify the class and general geographic area of the racetrack for which it will consider applications.

(3)

The Commission shall publish in the Texas Register an announcement of the beginning of the application process at least 30 days before the first day of the application period.

(4)

While an application for a particular class of racetrack in a geographic region is pending before the Commission, the Commission may not designate an additional application period nor accept additional applications for the same class and geographic region.

(c)

Application and Additional Documents.

(1)

An applicant for a license to operate a racetrack must submit an application on the form prescribed by the Commission and all additional documents in accordance with the application and this section.

(2)

The applicant must submit an original and five copies of the application and additional documents to the Commission.

(3)

The applicant must swear to the truth and validity of the information in the application and the additional documents before a notary public. If the applicant is not an individual, the chief executive officer of the applicant must swear to the truth and validity of the information in the application and the additional documents before a notary public.

(4)

The applicant must state the name, address, and telephone number of an individual designated by the applicant to be the primary contact person for the Commission during the application process.

(5)

The applicant must submit the application and all additional documents not later than 5:00 p.m. on the last day of the application period. An application filed after the deadline will not be accepted and may not be considered by the Commission.

(6)

The applicant must submit the information in the form specified by the application instructions. An application which is not in strict compliance with the form and manner set forth in the application instructions will not be accepted and may not be considered by the Commission.

(d)

Review of Application Documents.

(1)

Not later than the 15th day after the last day of an application period, the executive secretary shall review each application submitted to determine whether the application contains all the required information.

(2)

If the executive secretary determines that the application does not contain all the required information, the executive secretary shall notify the applicant in writing and state the nature of the deficiency in the application. The applicant shall submit the documents necessary to complete the application before the 30th day after the last day of the application period. If the applicant fails to submit the requested documents in a timely manner, the Commission may elect to not consider the application.

(3)

When the executive secretary determines that an application contains all the information required by this chapter, the executive secretary shall notify the applicant in writing that the application is complete.

(e)

Changes in the Application.

(1)

If information submitted by an applicant as part of a racetrack application changes or becomes inaccurate before the Commission acts on the application, the applicant shall immediately notify the executive secretary in writing of the change or inaccuracy.

(2)

After a racetrack application has been filed, the applicant may not amend the application except:

(A)

to address a deficiency in accordance with a notice sent under subsection (d) of this section;

(B)

as required by the Commission or the Commission staff to clarify information contained in the application; or

(C)

to address a change in the circumstances surrounding the application that was outside the control of the applicant and that affects the ability of the applicant to comply with the Act or the rules of the Commission.

(3)

To amend an application under paragraph (2)(C) of this subsection, an applicant must file with the executive secretary a written request to amend the application. The request must state:

(A)

the change in the circumstances surrounding the application that necessitate the amendment;

(B)

the nature of the amendment; and

(C)

the reasons why the amendment is necessary to bring the application into compliance with the Act or the Rules.

(4)

An applicant filing a request under subsection (3) of this subsection must serve a copy of the request on each party to the application proceeding.

(5)

The examiner shall grant or deny each request filed under paragraph (3) of this subsection. A request shall be granted if the applicant demonstrates that:

(A)

the circumstances requiring the amendment were outside the control of the applicant;

(B)

before the change in the circumstances surrounding the application, the application complied with the pertinent provisions of the Act or the Rules;

(C)

the amendment is necessary to bring the application into compliance with the pertinent provisions of the Act or the Rules; and

(D)

the amendment does not unfairly surprise another party to the application proceeding.

§309.4.Information for Background Investigation.

(a)

Fingerprint Requirements and Procedure.

(1)

Except as otherwise provided by this section, an applicant for a license must submit with the application documents a set of the applicant's fingerprints on a form prescribed by the Department of Public Safety and a set of the applicant's fingerprints for classification by the Federal Bureau of Investigation. If the applicant is not an individual, the applicant must submit a set of fingerprints on the above-referenced forms for each individual who:

(A)

serves as a director, officer, or partner of the applicant;

(B)

holds a beneficial ownership interest in the applicant of 5.0% or more; or

(C)

owns any interest in the applicant, if requested by the Department of Public Safety.

(2)

If the applicant is a political subdivision, each individual who is a member of the governing body of the political subdivision must submit a set of fingerprints as required by this section.

(3)

The fingerprints must be taken by a peace officer or a person authorized by the Commission.

(4)

Not later than the first business day after the day the Commission receives the fingerprints under this section, the Commission shall forward the fingerprints to the Department of Public Safety.

(5)

If an exempt institutional investor acquires an interest of 5.0% or more in an association, the investor is not required to submit any fingerprints unless specifically requested by the Commission or the Department of Public Safety. Not later than 10 days after the acquisition, the investor shall submit its most recent annual report or, if the annual report is not available, its most recent audited financial statements.

(b)

Criminal History Record.

(1)

For each individual who submits fingerprints under subsection (a) of this section, the Commission shall obtain a criminal history record maintained by the Texas Department of Public Safety and the Federal Bureau of Investigation.

(2)

The Commission may obtain criminal history record information from any law enforcement agency.

(3)

Except as otherwise provided by this subsection, the criminal history record information received under this section from any law enforcement agency that requires the information to be kept confidential as a condition of release of the information is for the exclusive use of the Commission and its agents and is privileged and confidential. The information may not be released or otherwise disclosed to any person or agency except in a criminal proceeding, in a hearing conducted by the Commission, on court order, or with the consent of the applicant. Information that is in a form available to the public is not privileged or confidential under this subsection and is subject to public disclosure.

(c)

Information for Department of Public Safety Background Investigation.

(1)

For each individual required to provide fingerprints under subsection (a) of this section, the application documents must include a completed form prescribed by the Department of Public Safety, which includes a statement disclosing whether the individual has ever been:

(A)

arrested; or

(B)

convicted of a felony or misdemeanor, other than a misdemeanor traffic offense.

(2)

All forms submitted under this section must be submitted under separate cover labeled "Department of Public Safety Disclosure Forms - Confidential" and include the fingerprint cards for the individuals submitting disclosure forms.

§309.5.Restrictions on Licensing.

(a)

Lease. If an applicant for a license to operate a racetrack intends to lease the racetrack facility from another person, the Commission may not grant the license if the Commission determines that:

(1)

the lessor would not be qualified to be issued a license; or

(2)

the lease is a subterfuge to avoid compliance with the Act or a rule of the Commission.

(b)

Reasonable Diligence Required. If the Commission determines that an association is failing to exercise reasonable diligence in preparing a racetrack to begin racing on the date approved by the Commission, the Commission may revoke the license and grant the license to another applicant.

§309.6.Security for Compliance.

(a)

Before the Commission may issue a racetrack license to an applicant under this chapter, the applicant must post security in an amount determined by the Commission to adequately ensure the association's compliance with the Act and the Rules and the association's completion of the racetrack facilities and the start of racing on the date approved by the Commission. The amount of the security must be reasonable in relation to the amount of revenue that will be lost if the association fails to start racing on the date approved by the Commission.

(b)

Cash, cashier's checks, surety bonds, irrevocable bank letters of credit, United States Treasury bonds that are readily convertible to cash, or irrevocable assignments of federally insured deposits in banks, savings and loan institutions, and credit unions are acceptable as security for purposes of this section.

(c)

If an association fails to start racing on the date approved by the Commission, the Commission may forfeit any portion of the security that is appropriate for the amount of revenue lost due to the failure to start racing.

(d)

After the association begins racing, the Commission shall return the remaining security to the association.

§309.7.Horse Racetrack Application Fees

(a)

General Provisions.

(1)

An applicant for a license must submit with the application documents an application or license fee in an amount set by the Commission.

(2)

The application fee for a racetrack license must be in the form of a certified check or cashier's check.

(b)

Application Fees.

(1)

The application fee for a horse racetrack license is composed of a processing charge, a variable investigation charge, and a variable hearing charge. The processing charge is the amount set to cover administrative costs. The investigation charge is the amount needed by the Commission to cover the costs incurred by the Department of Public Safety and Commission staff for conducting the background investigation on the applicant. The hearing charge is the amount needed by the Commission to pay for the State Office of Administrative Hearings, legal and court reporting services for conducting a hearing on the application. An applicant for a horse racetrack license must pay all charges on filing the application. The failure to pay the total amount of the application fee may result in the application being struck by the Commission or an administrative law judge. If the application does not contain all the required information, the Commission shall return the investigation charge and hearing charge. If the application contains all the required information, the Commission shall hold the investigation charge and hearing charge in the state treasury in a suspense account. Not later than five business days after the date the Commission order on the application is final and appealable, the Commission shall transfer the suspense funds due to the Commission to the Texas Racing Commission Fund. If the costs of the investigation or hearing exceed the amount of the applicable charge, the applicant shall pay the remaining amount not later than 10 business days after receipt of a bill from the Commission. If the costs of the investigation or hearing are less than the amount of the charge, the Commission shall refund the excess not later than 10 days after the Commission order on the application is final and appealable.

(2)

The processing charge for a horse racetrack license application is:

(A)

for a Class 1 racetrack, $50,000;

(B)

for a Class 2 racetrack, $20,000;

(C)

for a Class 3 racetrack, $3,000; and

(D)

for a Class 4 racetrack, $1,500.

(3)

The amount to be deposited for the investigation charge for a horse racetrack license application is:

(A)

for a Class 1 racetrack, $25,000;

(B)

for a Class 2 racetrack, $15,000;

(C)

for a Class 3 racetrack, $1,500; and

(D)

for a Class 4 racetrack, $1,000.

(4)

The amount to be deposited for the hearing charge for a horse racetrack license application is:

(A)

for a Class 1 racetrack, $15,000;

(B)

for a Class 2 racetrack, $8,000;

(C)

for a Class 3 racetrack, $1,500; and

(D)

for a Class 4 racetrack, $1,000.

§309.8. Racetrack License Fees.

(a)

Purpose of Fees. An association shall pay a license fee to the Commission to pay the Commission's costs to administer and enforce the Act and provide racing officials for the association's live races.

(b)

Live Racing Fee. An association shall pay a live racing fee for each live race day conducted by the association. The fee is due to the Commission no later than 5:00 p.m. of the day following the race day. The live racing fee for a greyhound racing association is $550 per performance. The live racing fee for a horse racing association is:

(1)

for a Class 1 or Class 2 racetrack, $2075 per day; and

(2)

for a Class 3 or Class 4 racetrack, $650 per day.

(c)

Inactive License Fee. An association that is licensed but is not conducting live racing or simulcasting shall pay an inactive license fee. The fee is due to the Commission on September 1 of each year. The inactive license fee for a greyhound racing association is $25,000. The inactive license fee for a horse racing association is:

(1)

for a Class 1 racetrack, $25,000;

(2)

for a Class 2 racetrack, $10,000;

(3)

for a Class 3 racetrack, $3,500; and

(4)

for a Class 4 racetrack, $1,250.

(d)

Simulcast Fee. An association shall pay a simulcast fee for each day on which the association offers a simulcast race for wagering. The fee is due to the Commission no later than 5:00 p.m. of the day following the day on which the simulcast is offered. The simulcast fee is $245 per day.

(e)

Adjustment of Fee.

(1)

After the end of the Commission's fiscal year, the executive secretary shall determine annually the total amount of the fees paid by all associations, together with the revenues received by the Commission from all other sources, excluding occupational license fees, is sufficient to pay the Commission's costs to administer and enforce the Act and to provide racing officials for the associations' live races.

(2)

If the executive secretary determines the total revenue from those sources is insufficient to pay those costs, the executive secretary shall recommend a revised fee structure to the Commission that will generate the necessary revenue.

(3)

If the executive secretary determines the total revenue from those sources exceeds the amount needed to pay those costs, the executive secretary may order a moratorium on any or all license fees to any or all of the associations. Before entering a moratorium order, the executive secretary shall develop a formula for providing the moratorium in an equitable manner among the associations. In developing the formula, the executive secretary shall consider the amount of excess revenue received by the Commission, the source of the revenue, the Commission's costs associated with regulating each association, the Commission's projected receipts for the next fiscal year, and the Commission's projected expenses during the next fiscal year.

§309.9.Denial, Suspension and Revocation of Licenses.

(a)

Applicability.

(1)

After notice and hearing in accordance with Subchapter B, Chapter 307 of this title (relating to Adjudicative Procedures), the Commission, stewards, or racing judges may deny, suspend or revoke a license issued by the Commission.

(2)

If the licensee is not an individual, the grounds for denial, suspension, or revocation of a license apply if a director, officer, or partner of the licensee or an individual who owns an interest in the licensee of 5.0% or more engages in conduct for which a license may be denied, suspended or revoked.

(b)

Grounds for Denying, Suspending and Revoking Licenses.

(1)

Violations or Convictions. A license may be denied, suspended or revoked if it is determined that the licensee has:

(A)

violated or caused to be violated the Act or a Rule;

(B)

been convicted in a court of competent jurisdiction of violating the Act or a Rule;

(C)

been convicted of a felony;

(D)

been convicted of a crime of moral turpitude that is reasonably related to the licensee's fitness to hold a license in accordance with §303.202 of this title (relating to Guidelines);

(E)

aided, abetted, or conspired with another person to violate the Act or a Rule; or

(F)

the licensee had a license issued by another pari-mutuel racing jurisdiction denied, revoked or is currently under suspension in another pari- mutuel racing jurisdiction.

(2)

Failure to Disclose. A license may be denied, suspended or revoked if it is determined that the licensee:

(A)

failed to provide information required in the license application;

(B)

provided false information in the license application;

(C)

failed to disclose an ownership interest in a horse or greyhound as required by the Rules; or

(D)

failed to fully disclose the true owners of all interests, beneficial or otherwise, in a proposed racetrack facility.

(3)

Domicile. A license may be denied, suspended or revoked if it is determined that the licensee is domiciled with an individual for whom a license issued by the Commission was denied, suspended or revoked during the preceding 12-month period.

(4)

Debt or Liens.

(A)

A license may be denied, suspended or revoked if it is determined that the licensee owes a fee to the state or a penalty imposed under the Act or the Rules.

(B)

A license may be denied, suspended or revoked if it is determined that:

(i)

the licensee has failed to timely pay any tax assessment, the payment of which is secured by any lien or encumbrance against the racetrack site; or

(ii)

a notice has been posted of the public sale of any portion of the racetrack site or the holder of any lien or security interest on any part of the racetrack site has instituted foreclosure or other proceedings for the enforcement of remedies under the terms of any instrument creating such a lien or security interest.

(5)

Ejection. A license may be denied, suspended or revoked if it is determined that the licensee has engaged in conduct for which the licensee may be ejected or excluded from a racetrack under the Rules.

(6)

Racetrack License. A license may be denied, suspended or revoked if it is determined that the licensee:

(A)

has not attained the minimum age necessary to purchase alcoholic beverages in Texas; or

(B)

through a change in ownership, would be ineligible to be issued a license.

(7)

Detrimental Practices. A license may be denied, suspended or revoked if it is determined that the licensee is engaged in activities or practices that are detrimental to the best interests of the public or to the racing industry.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on August 2, 1999.

TRD-9904683

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter B. Operation of Racetracks

1. General Provisions

16 TAC §§309.101-309.104

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; §6.061, which authorizes the Commission to adopt rules relating to the regulation of inappropriate and unsafe conditions at licensed racetracks; and §6.062, which authorizes the Commission to adopt rules relating to a method of supervising and approving the construction, renovation or maintenance of facilities on the premises of licensed racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.101.Duty of Association.

An association shall operate and provide facilities at a racetrack for which it is licensed in accordance with this chapter.

§309.102.Exemption or Deferred Compliance.

(a)

An association may request an exemption or deferred compliance from a requirement in this subchapter in accordance with this section.

(b)

An association operating a Class 2, 3 or 4 racetrack may request an exemption or deferred compliance if the association determines that compliance with the requirement is:

(1)

economically or geographically infeasible; or

(2)

unnecessary due to new technology or an innovative construction or design of the racetrack.

(c)

An association operating a Class 1 or greyhound racetrack may request an exemption if the association determines that compliance with the requirement is unnecessary due to new technology or an innovative construction or design of the racetrack.

(d)

To request an exemption under this section, the association shall:

(1)

state the association's reason for the request;

(2)

propose an alternative that substantially satisfies the purpose of the requirement; and

(3)

if the request is for a temporary exemption, establish a schedule under which the association will comply with the requirement

(e)

To request deferred compliance under this section, the association shall:

(1)

state the association's reason for the request;

(2)

propose an alternative that substantially satisfies the purpose of the requirement until compliance is established; and

(3)

establish a schedule under which the association will comply with the requirement.

(f)

The Commission may grant an exemption or defer compliance under this section if the Commission determines:

(1)

the association's alternative proposal substantially satisfies the purpose of the requirement;

(2)

the proposed schedule for compliance is reasonable; and

(3)

the Commission determines the exemption or deferred compliance is in the best interests of the race horses or greyhounds, the racing industry, and the citizens of Texas.

§309.103.Construction and Renovation of Racetrack Facilities.

(a)

Definitions. In this section:

(1)

"Racetrack construction project" means:

(A)

the construction of a new racetrack facility by an association; or

(B)

the renovation of an existing racetrack facility by an association that affects a specific requirement in the Rules.

(2)

"Construction plan" means architectural drawings, engineering plans, or other documents that describe a proposed racetrack construction project.

(b)

Review of construction plan.

(1)

At least 30 days before the date an association proposes to start a racetrack construction project, the association shall submit a construction plan to the executive secretary. The construction plan must be in sufficient detail for the executive secretary to determine whether the proposed project complies with all applicable Commission rules.

(2)

After reviewing the construction plan, if the executive secretary determines the racetrack construction project will comply with the Rules, the executive secretary shall approve the project. If the executive secretary determines the project will not comply with the Rules, the executive secretary shall notify the association in writing and specifically describe the aspect of the project that does not comply. The executive secretary shall make every effort to review the construction plan and notify the association under this paragraph of his/her determination before the date the construction is proposed to start.

(3)

If the project is not approved, the association may not start construction until the necessary corrections are made to the construction plan for the project to comply with the Rules and the executive secretary has approved the corrections.

(c)

Monitoring construction.

(1)

At least monthly during a racetrack construction project, an association shall file a written report with the executive secretary on the progress of the project.

(2)

The executive secretary or his/her designee may periodically inspect the project to ensure ongoing compliance with the Rules.

(3)

An association shall maintain records of the racetrack construction project, including a copy of all change orders made during the project. Records shall be maintained under this paragraph for at least twelve months after the end of the project and are subject to review by the executive secretary at any time.

(d)

Changes to construction plan.

(1)

If after construction starts an association changes the construction plan in a manner that affects a requirement in the Rules, the association shall notify the executive secretary in writing. The association shall state the reason for the change.

(2)

After reviewing the change if the executive secretary determines the change complies with the Rules, the executive secretary shall approve the change. If the executive secretary determines the change does not comply with the Rules, the executive secretary shall notify the association in writing and specifically state why the change does not comply.

(3)

If the change is not approved, the association may not continue on any aspect of the project that is affected by the change until the necessary corrections are made and the executive secretary has approved the corrections.

(e)

Final approval.

(1)

After a racetrack construction project is complete, the executive secretary or his/her designee shall inspect the newly constructed or renovated portion of the racetrack facility to determine whether the facility complies with the Rules.

(2)

If the executive secretary determines the facility complies with the Rules, the executive secretary shall approve the facility for use. If the executive secretary determines the facility does not comply with the Rules, the executive secretary shall issue a notice of violation to the association. The notice of violation must specify the specific rule violated. The notice of violation must include an order to remedy the violation and state a deadline for the remediation.

(3)

The association may not use the newly constructed or renovated portion of the racetrack facility for racing, training, or wagering purposes until the executive secretary has determined that the facility complies with the Rules.

§309.104.Compliance Inspections.

(a)

Inspection Program.

(1)

The executive secretary shall develop a comprehensive program to periodically inspect racetrack facilities for compliance with the Rules.

(2)

The inspection program shall identify the various items that must be inspected at each racetrack facility, the persons responsible for conducting the inspections, and the procedure for conducting inspections.

(b)

Violations.

(1)

If an inspection reveals a racetrack facility is not in compliance with a rule, the executive secretary shall issue a notice of violation to the association operating the racetrack facility. The notice of violation must specify the specific rule violated and include an order to remedy the violation and state a deadline for the remediation.

(2)

An association's failure to remedy a condition that violates a rule on or before the deadline established by the executive secretary is grounds for disciplinary action against the association.

(c)

Reports to Commission.

(1)

The executive secretary shall make periodic reports to the Commission in open meeting regarding inspections of racetrack facilities. The reports must include information on the number and type of inspections conducted, the results of the inspections, any remediation ordered by the executive secretary, and the results of any orders issued by the executive secretary.

(2)

If after reviewing a report by the executive secretary the Commission determines the executive secretary has misinterpreted or misapplied a rule, the Commission shall require the executive secretary to modify any order issued by the executive secretary that is based on the misinterpretation of the rule.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904684

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Earliest possible date of adoption: September 12, 1999

For further information, please call: (512) 833-6699


2. Facilities and Equipment

16 TAC §§309.111-309.132

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §11.04, which authorizes the commission to adopt rules permitting the placement of automatic banking machines on the grounds of pari-mutuel racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.111.Comfort and Safety.

(a)

An association shall ensure that the public areas of the association grounds are designed and maintained for the comfort and safety of the patrons.

(b)

An association shall designate as a non-smoking area a portion of each of the public areas on association grounds.

§309.112.Maintenance.

An association shall maintain all facilities on association grounds, including facilities provided for use by the Commission staff, to ensure the safety and cleanliness of the facilities at all times.

§309.113.Accessibility by Disabled Persons.

(a)

An association shall ensure that all public areas of the association grounds are accessible by disabled persons in accordance with standards adopted for public buildings under Texas Civil Statutes, Article 9102.

(b)

An association shall accommodate the wagering and entertainment needs of disabled persons. Accommodation includes all aspects of providing the association's services to disabled persons, including but not limited to the audio- visual displays of racing information, the number of betting windows designed for disabled persons, and accommodations in all areas of the racetrack.

§309.114.Restrooms.

An association shall provide and maintain restroom facilities which are adequate in number, design, construction, and location for all persons on association grounds.

§309.115.Refreshments.

An association shall provide an adequate supply of free drinking water and other refreshments for the patrons.

§309.116.Complaints.

(a)

An association shall provide an office to handle complaints regarding the association facilities or an alleged violation of the Act or the Rules.

(b)

An association shall respond promptly to all complaints by patrons regarding the association facilities.

(c)

An association shall promptly notify the Commission of a complaint regarding an alleged violation of the Act or the Rules.

(d)

An association shall maintain a record of each complaint received and the action taken by the association regarding the complaint.

§309.117.First Aid.

(a)

During a live race performance, a greyhound racing association shall provide:

(1)

a first aid room equipped with at least two beds and other appropriate equipment; and

(2)

the services of a basic emergency medical technician certified after September 1, 1996 or a certified paramedic.

(b)

During a live race meeting, a horse racing association shall provide a properly equipped and staffed ambulance for humans and the services of a certified paramedic at any time that the racetrack is open for racing or exercising. At a Class 1 or 2 racetrack, the primary ambulance must be a Mobile Intensive Care Unit (MICU) certified by the Texas Department of Health. If the MICU ambulance is used to transport an individual, the association may not conduct a race until the ambulance is replaced by an ambulance approved by the executive secretary. The ambulance must be parked at the entrance to the racing strip when not being used to transport an individual.

§309.118.Regulatory Office Space and Equipment.

(a)

An association shall provide adequate office space for the use of the stewards or racing judges, occupational licensing personnel, the Commission's investigative unit, the pari-mutuel auditing staff and the staff employed by the comptroller, and the Department of Public Safety. The location and size of the office space, furnishings, and equipment required under this section must be approved by the executive secretary.

(b)

An association shall provide a place for posting notices from the Commission that is easily viewed by patrons and licensees. An association shall promptly post all notices received from the Commission.

(c)

The office for the stewards or racing judges must be furnished and be equipped with at least one private telephone line.

(d)

The office for the Commission's investigative unit must be located adjacent to the occupational licensing office and the Department of Public Safety office. The office must be furnished and be equipped with:

(1)

a private telephone line; and

(2)

a television monitor to monitor the events on the racetrack.

(e)

The office space for occupational licensing personnel must consist of two rooms, one of which must be private. The room that is not private must be equipped with:

(1)

a double counter;

(2)

a fingerprint work area;

(3)

a television monitor; and

(4)

a private telephone line.

(f)

The office space for the pari-mutuel auditing staff and the staff employed by the comptroller must:

(1)

provide an unrestricted view of the totalisator system operators and the pari-mutuel computers;

(2)

permit unrestricted entry to the totalisator facilities;

(3)

be furnished with the appropriate number of desks and chairs;

(4)

include locking file cabinets in the work area or other locking storage facilities, in which the auditors may store computer printouts or magnetic tape and that are large enough to store all state-controlled wagering records for the association that are needed for audits by the Commission or the comptroller;

(5)

include a video and audio device that enables the auditors to receive, simultaneously with the patrons, the same information that the patrons receive;

(6)

have at least four power outlets to operate electrical equipment;

(7)

include a private telephone line; and

(8)

if requested by the Commission or the comptroller, have an additional voice line to support dial-up capabilities for a personal computer.

(g)

Commission Veterinarian's Office.

(1)

An association shall provide a secured office area for the Commission veterinarians.

(2)

The office must be adjacent to the test barn and the pre-race holding area.

(3)

The office must consist of at least two rooms, one of which must be private. The office must have a total floor area of at least 200 square feet.

(4)

The office must be constructed to allow a view of each of the adjacent areas.

(5)

The office must be equipped with:

(A)

a sink with hot and cold water;

(B)

a desk and two filing cabinets, both of which may be locked;

(C)

a refrigerator with at least 10 cubic feet of inside space and a freezer, in a size as required by the Commission, both equipped with locks; and

(D)

a storage area, which may be locked.

(6)

All locks must be of a type approved by the executive secretary.

(h)

An association shall provide a private telephone line for the exclusive use of the Department of Public Safety in the department's office. An association shall provide, inside the enclosure in close proximity to the department's office, adequate reserved parking for the Department of Public Safety personnel.

(i)

All private telephone lines provided under this section must have listings separate from the association.

(j)

An association shall provide at its expense computer lines in the offices of the pari-mutuel auditor, the occupational licensing personnel, and the Commission veterinarian.

(k)

All costs of the telephone service and regulatory personnel provided under this section shall be paid by the association and the telephone service may not be interrupted at any time.

§309.119.Recreational Facilities.

An association shall provide a lounge area or other recreational facilities for licensees working on association grounds.

§309.120.Parking for Licensees.

An association shall provide a parking facility outside the enclosure for licensees working on association grounds.

§309.121.Eating Facilities.

An association shall provide adequate eating facilities that are open at any time that the number of individuals working on association grounds warrants.

§309.122. External Communication.

(a)

Except as otherwise provided in this section, an association may have telecommunication systems on the premises during a race meeting for the benefit of the public press or for transacting ordinary business.

(b)

The telecommunication systems may not be used to transmit money or other things of value, or to direct the placing of an illegal wager on the result of a race.

(c)

A portable telephone, transmitter, or other instrument of communication that can be used for transmitting messages off association grounds is subject to confiscation by security personnel or by an employee of the Commission if it is being used for bookmaking, other illegal activity or a purpose inconsistent with maintaining the integrity of racing and pari-mutuel wagering.

§309.123.Internal Communication System.

(a)

An association shall provide an internal telephone communication system with outlets in:

(1)

the stewards' or judges' stand;

(2)

the racing office;

(3)

the tote room;

(4)

the jockey room;

(5)

the paddock or lockout kennel;

(6)

the entrance to the kennel compound;

(7)

the pre-race holding area;

(8)

the Commission veterinarian's office;

(9)

the test barn;

(10)

the starting gate or boxes;

(11)

the finish line;

(12)

the video camera locations;

(13)

the clocker's stand;

(14)

the location of the ambulances; and

(15)

other locations designated by the executive secretary.

(b)

The executive secretary may approve an alternative communication system in areas within the enclosure for which the executive secretary has determined telephone communication is impractical.

§309.124.Public Address System.

An association shall provide and maintain a public address system capable of transmitting announcements to the patrons and to the stable or kennel area.

§309.125.Photofinish Equipment.

(a)

An association shall provide an electronic photofinish device with mirror image to photograph the finish of each race and record the time of each horse or greyhound in at least hundredths of a second.

(b)

The association may use an additional, more exact time measurement device.

(c)

The association shall maintain an auxiliary photofinish device in case of an emergency.

(d)

The location and operation of the photofinish device must be approved by the executive secretary before its first use in a race.

(e)

The association shall, upon request, make available for viewing the photofinish of each race for win, place, or show in a designated area accessible to the public.

(f)

The association shall ensure that the photofinish device is calibrated before the first day of each race meeting and at other times as required by the Commission. 309.126. Videotape Equipment.

§309. 126.Videotape Equipment.

(a)

An association shall provide a videotape system to record each race in color from start to finish.

(b)

The videotape of a horse race must provide a clear panoramic and head-on view of the position and action of the horses and jockeys at a range sufficient for motions to be easily discerned by the stewards. The videotape of a greyhound race must provide a clear view of the position and action of the greyhounds at a range sufficient for motions to be easily discerned by the racing judges.

(c)

The association shall provide, in the stewards' or judges' stand, separate monitors which simultaneously display the images being received by each camera during the running of a race for reviewing a race.

(d)

A horse race run on an oval racetrack must be recorded by at least three video cameras. A horse race run on a straight course racetrack must be recorded by at least two video cameras. At a Class 1 racetrack, a horse race run on an oval racetrack must be recorded by at least four video cameras.

(e)

The location and height of video towers and the operation of the videotape system must be approved by the executive secretary before its first use in a race.

(f)

An association shall provide a viewing room in which, on approval of the stewards or racing judges, an owner, trainer, jockey, or other interested individual may view a videotape recording of a race.

(g)

The association shall maintain an auxiliary videotape system in case of an emergency.

(h)

A Class 1 racetrack must have:

(1)

a video camera that provides a complete, uninterrupted view of the entire oval;

(2)

a video camera located in the tower that provides a head-on view of the backstretch;

(3)

a video camera located in a tower that provides a head-on view of the homestretch; and

(4)

a video camera located in a tower that provides a rear view of the homestretch. 309.127. Maintenance of Negatives and Videotapes.

§309.127.Maintenance of Negatives and Videotapes.

(a)

An association shall preserve either the negative of each photograph of the finish of a race or the image of each electronic photofinish of a race, whichever device is used, and the videotape of a race for at least one year after the last day of the race meeting during which the photograph, electronic photofinish image or videotape was made.

(b)

On request by the Commission, the association shall provide a print from a negative, or copy of the image from the electronic photofinish device or a copy of a videotape to the Commission.

(c)

Not later than 10 days after a race in which an injury to or the death of a race animal or jockey occurred, the association shall deliver to the Commission a copy of the videotape of that race.

§309.128.Lighting.

(a)

An association shall provide adequate lighting on association grounds to ensure the safety of the horses or greyhounds, the employees, and patrons.

(b)

If an association conducts races at night, the association shall maintain a back-up lighting system in case of an emergency.

(c)

An association shall perform regular maintenance and checks on the lighting systems to ensure that the systems are in proper working order.

§309.129. Automatic Banking Machines.

(a)

An association may permit the placement of an automatic banking machine on association grounds only in accordance with this section. For purposes of this section, "automatic banking machine" means an electronic terminal, as that term is defined by Regulation E, Electronic Fund Transfers, 12 CFR 205.

(b)

Vendor.

(1)

If an association contracts with a vendor to provide an automatic banking machine, the contract is subject to inspection by the Commission. The contract may not contain any provision that violates or is inconsistent with the Texas Racing Act or these rules. The association shall make the contract available to the Commission on request.

(2)

A vendor of automatic banking machines for pari-mutuel racetracks must be licensed by the Commission. If the vendor is not an individual, a designated representative of the vendor selected by the executive secretary must be licensed.

(c)

Configuration. An automatic banking machine placed on association grounds must be configured with the following restrictions:

(1)

A customer using the machine may withdraw funds only from his or her checking account at a bank or other financial institution. A customer may not use the machine to withdraw funds from a savings account.

(2)

A customer may withdraw no more than $200 per day per account. For purposes of this paragraph, a "day" is the 24-hour period beginning at 12:00 midnight.

(3)

For each transaction at a machine, a statutory fee of $1.00 must be withdrawn from the customer's account in addition to the amount delivered to the customer and any other fees authorized and imposed by the bank or other financial institution, by the association, or by the vendor.

(4)

Before the customer authorizes the transaction, the machine must display a screen that notifies the customer of the statutory fee and permits the customer to cancel the transaction. The notice must state the following or its equivalent: UNDER TEXAS RACING ACT, §11.04(E), A $1 FEE MUST BE COLLECTED ON EACH TRANSACTION AT THIS MACHINE FOR DEPOSIT INTO THE TEXAS STATE TREASURY.

(d)

Collection and Payment of Fee.

(1)

The association or vendor, if applicable, shall collect the statutory fee periodically and pay the total amount of the statutory fees collected during the preceding month to the Commission not later than a date set by the executive secretary. Payment of the statutory fee must be made in accordance with procedures established by the executive secretary.

(2)

Failure to collect and pay the proper amounts for the statutory fee may result in disciplinary action against the association or vendor.

(e)

Records and Audit.

(1)

The association or vendor, if applicable, shall maintain complete records regarding all transactions conducted at each machine placed by the association or vendor on association grounds. The records must be maintained for at least three years after the date of the transaction.

(2)

The Commission may audit the records at any time to ensure the proper collection and payment of the statutory fees.

(f)

Compliance with Other Laws. A machine placed on association grounds under this section must comply with all other applicable state and federal statutes and regulations. This section may not be construed to supersede any other state or federal statutes or regulations applicable to automatic banking machines.

§309.130. Attendance.

An association shall provide turnstiles or another method approved by the executive secretary for monitoring the attendance at the racetrack.

§309.131. Breathalyzer Machine.

An association shall provide and maintain a breathalyzer of a type approved by the executive secretary for use by the Commission staff. The breathalyzer shall be calibrated on a regular basis to ensure the integrity of the tests being conducted. A report of each calibration shall be recorded in a calibration log maintained by the association.

§309.132. Approval of Equipment.

Before an association may install an item of equipment pertaining to racing, the item and the proposed installation must be approved by the executive secretary. The association may not remove an item of equipment that has been approved and installed without the prior approval of the executive secretary.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904685

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Earliest possible date of adoption: September 12, 1999

For further information, please call: (512) 833-6699


3. Operations

16 TAC §§309.151-309.167

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act ; §6.031, which describes the requirements for a background check for racetrack license applicants; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.151.Change of Ownership, Board of Directors, or Management Committee.

(a)

Except as otherwise provided by this section, an association may not transfer an ownership interest in the association, grant or sell an option to buy an ownership interest in the association, or make a change in the board of directors or management committee of the association without the prior approval of the Commission.

(b)

To receive the approval of the Commission for a proposed ownership transfer, the association shall submit to the Commission all written documents relating to the transfer. If there are no written documents relating to the transfer, the association shall submit a written summary of all terms of the transfer including, but not limited to, the consideration given, the proposed date of the transfer, and the terms of any option given for future acquisition of additional ownership interests. The association shall also submit the following information:

(1)

the tranferor's name, total ownership percentage, and the manner in which the ownership interest is held, such as through a limited partnership or shares of stock in a corporate general partner or association;

(2)

the tranferee's name, residence address and telephone number, business address and telephone number, date of birth, physical description, driver's license number, and social security number;

(3)

the percentage of ownership interest the transferee is acquiring; and

(4)

a set of fingerprints on a form prescribed by the Department of Public Safety, a set of fingerprints for classification by the Federal Bureau of Investigation and completed background information form for the Department of Public Safety, if the transfer results in the acquisition of an ownership interest of 5.0% or more in the association by an individual who has not previously submitted fingerprints to the Commission.

(c)

To receive the approval of the Commission for a change in the board of directors or management committee, the association shall submit to the Commission a written request for the change, the names of the individuals involved in the change, the percentage of any ownership interest the individuals hold in the association, and the proposed date of the change. If the proposed change involves placing an individual on the board of directors or management committee who has not previously submitted fingerprints to the Commission, the association shall also submit:

(1)

the individual's name, residence address and telephone number, business address and telephone number, date of birth, physical description, driver's license number, and social security number; and

(2)

a set of fingerprints on a form prescribed by the Department of Public Safety, a set of fingerprints for classification by the Federal Bureau of Investigation and completed background information form for the Department of Public Safety.

(d)

The transfers of pecuniary interests in an association described by this subsection are considered to have the prior approval of the Commission, subject to the right of the Commission to object to the transfer after it is informed of the transfer and has performed any background investigation required by the Commission or the Department of Public Safety. Not later than 10 days after the effective date of a transfer to which this subsection applies, the transferee shall submit to the Commission information regarding the transfer on a form prescribed by the Commission and the Department of Public Safety. If the transferee is not an individual, the form required by this subsection must be submitted for all officers, directors, partners, and members of any management committee of the transferee. The following transfers are considered to have the prior approval of the Commission in accordance with this subsection:

(1)

a transfer to an exempt institutional investor of a direct or indirect beneficial ownership interest or a warrant or other option to buy a direct or indirect beneficial ownership interest in an association provided:

(A)

following the transfer, the exempt institutional investor owns, directly or indirectly, less than 10% of the total beneficial ownership interests in the association; and

(B)

if the transfer results in the investor holding 5.0% or more of the total beneficial ownership interests in the association, the exempt institutional investor provides to the Commission, not later than 10 days after the transfer, a copy of the investor's most recent annual report or, if the report is not available, a copy of the investor's most recent audited financial statements; and

(2)

a transfer to any person of a direct or indirect beneficial ownership interest or a warrant or other option to buy a direct or indirect beneficial ownership interest in an association provided:

(A)

the interest was transferred after having been registered under the Federal Securities Act of 1933; and

(B)

following the transfer, the person owns, directly or indirectly, less than 5.0% of the total beneficial ownership interests in the association.

§309.152.Records.

(a)

An association shall maintain records regarding the management and operation of the racetrack for which the association is licensed.

(b)

The records must be maintained on the association grounds.

(c)

Not later than June 15 of each year, an association shall submit audited financial statements to the Commission regarding the management and operation of the racetrack. The executive secretary may prescribe a form on which the financial information must be submitted to the Commission.

(d)

The executive secretary may require an association to submit a balance sheet and profit and loss statements, not later than five business days after making the request, to determine whether the association continues to be financially viable and capable of performing the duties of an association.

§309.153.General Security.

(a)

An association shall secure the peaceful use of the association grounds by providing security personnel that is adequate in number and training. The number of security personnel and the level of training required for security personnel is subject to the approval of the executive secretary. All security personnel, including peace officers providing security services to the association, must be individually licensed by the Commission.

(b)

On request by the Commission, an association shall provide proof of adequate liability insurance for the racetrack.

§309.154. Stable or kennel Area.

(a)

An association shall provide continuous security service in the stable or kennel area:

(1)

at a horse racetrack, for the period beginning 10 days before the first day of a race meeting and ending 10 days after the last day of a race meeting unless otherwise approved by the executive secretary; and

(2)

at a greyhound racetrack, at any time that a greyhound is housed in the area.

(b)

An association shall ensure that the stable or kennel area is fenced in a manner that prohibits a person from crawling under or over the fence.

(c)

An association shall prohibit a person from entering or being present in the stable or kennel area unless the person displays a badge issued by the Commission or a temporary pass issued by the association.

§309.155.Stable/Kennel Area Visitors Pass.

(a)

An association may issue a visitor's pass to a person to enter the stable or kennel area in accordance with this section. The association security staff shall maintain a log showing the date, name of visitor, pass number, and the person granting the pass and the person's Commission license number. A person to whom a visitor's pass has been issued shall display the pass on the person's clothing at all times that the person is in the stable or kennel area.

(b)

An association may issue a visitor's pass only to a guest of:

(1)

an association officer or official;

(2)

a Commission employee;

(3)

a trainer, assistant trainer, or kennel owner licensed by the Commission;

(4)

the owner of a horse or greyhound stabled or kenneled on association grounds; or

(5)

a veterinarian licensed by the Commission.

(c)

A visitor's pass must contain:

(1)

the visitor's name;

(2)

the date the pass was issued; and

(3)

the sequential pass number.

(d)

A visitor's pass issued under this section is valid only for the date the pass is issued.

(e)

A visitor's pass does not entitle the person to whom the pass is issued to participate in racing in any way other than as a patron.

(f)

The licensee granting the visitor's pass is responsible for the proper conduct of the visitor and shall ensure compliance by the visitor with all Commission rules.

§309.156. Incident Reports and Accident Records.

(a)

Not later that 72 hours after an incident occurs requiring the attention of security personnel, the chief of security for an association shall deliver to the stewards or racing judges a written report describing the incident.

(b)

The report must contain the name of each individual involved in the incident, the circumstances of the incident, and any recommended charges against each individual involved.

(c)

An association shall also maintain records regarding all accidents that occur on association grounds during a race meeting and that result in an injury to a person or race animal. A copy of the record shall be provided upon request by the executive secretary. 309.157. Fire Prevention.

§309.157.Fire Pevention.

(a)

An association shall develop and implement a program for fire prevention on association grounds.

(b)

An association shall instruct employees working on association grounds of the procedures for fire prevention.

(c)

Not later than ten day before the first day of a race meeting, an association shall deliver to the Commission a copy of the state or local fire marshal's certification regarding the association's compliance with fire safety regulations. The certification must be based on an inspection of the association grounds conducted by the fire marshal not more than 30 days before the first day of the race meeting.

(d)

An association shall prohibit:

(1)

smoking in stalls, near greyhound crates, in feed rooms or hay storage areas, and under shed rows;

(2)

open fires and oil or gas lamps in the stable or kennel area;

(3)

unattended electrical appliances that are plugged in to an outlet;

(4)

electrical outlets or cords left within reach of a race animal;

(5)

flammable materials, such as cleaning fluids or solvents, kept in the stable or kennel area; and

(6)

locking a stall occupied by a horse.

§309.158. Insect Control.

An association shall provide effective insect control, including control of external parasites, to all areas of the association grounds other than inside a kennel building at all times that a horse or greyhound is housed on association grounds.

§309.159.Alcoholic Beverages.

(a)

An association may not permit the sale, possession, or consumption of an alcoholic beverage in the stable or kennel area for the period beginning 10 days before the first day of a race meeting and ending 10 days after the last day of a race meeting, unless written consent has been granted by the Commission at least 30 days prior for a special event to be held within the stable or kennel enclosure.

(b)

The Commission may consent to a temporary waiver of the alcohol prohibition upon confirmation that no local ordinances would be violated and that the Texas Alcoholic Beverage Commission has approved the activity. The association shall submit a request for a special event waiver detailing the dates, times, and nature of the special event. The Commission may grant conditional approval.

§309.160. Vendors.

(a)

An association may not permit the sale of food, animal feed, medication, or equipment in the stable or kennel area by a vendor or vendor employee who is not properly licensed by the Commission.

(b)

An association shall supervise the operations on association grounds of a vendor of food, animal feed, medication, or equipment in the stable or kennel area.

(c)

An association may not grant an exclusive concession to a vendor of animal feed, racing supplies, or racing services. An association may not control or monopolize the sale of goods to employees who work in the stable or kennel area.

(d)

A vendor of an animal feed or medication shall file with the Commission veterinarian a list of products that the vendor proposes to sell on association grounds. The Commission veterinarian shall inform the vendor if the list includes any products which are prohibited from being possessed on association grounds and to which the vendor is prohibited from selling on association grounds.

§309.161.Racing at Designated Place.

(a)

Except as otherwise provided by this section, an association may not conduct races at a location other than the racetrack location designated on the license issued by the Commission.

(b)

On application by an association, the Commission may authorize the association to conduct races at a location other than the racetrack location designated on the license if the Commission determines:

(1)

a race meeting conducted by the association was interrupted by a fire, flood, or other natural disaster that made the racetrack unsuitable for racing; or

(2)

construction on the designated racetrack has not been completed.

(c)

The Commission may not permit an association to conduct races under this section in a county other than the county in which the designated racetrack is located.

(d)

Authority granted under subsection (b)(1) of this section expires at the end of the race meeting that was interrupted.

(e)

Authority granted under subsection (b)(2) of this section expires two years after the date the authority was granted or on completion of the designated racetrack, whichever occurs first.

§309.162.Management, Totalisator Companies, and Concessionaires Contracts.

(a)

An association's contract for management, concession, or totalisator services must be approved by the Commission. A contract that requires approval under this section must be in writing.

(b)

To receive approval by the Commission for the proposed contract, an association shall submit the person's name, address, telephone number, and any proposed contract to the Commission for its approval. For each person submitted under this subsection, the executive secretary shall designate the individuals who must provide complete background information pursuant to the Act, §6.031.

(c)

Except as otherwise provided by this subsection, an association may not solicit or accept a loan of anything of value from a person who is providing management, concession, or totalisator services at a racetrack for which the association is licensed. This subsection does not apply to a loan from a person who owns an interest in the association of 5.0% or more. On request by the executive secretary, the association shall provide a copy of documentation regarding a loan.

(d)

A person who provides general management, totalisator, or concession services at a racetrack shall maintain records of its operations, including all accounting records required under generally accepted accounting principles, and shall make the records available for inspection by a representative of the Commission on request by the executive secretary. Not later than June 15 of each year, the person shall submit financial statements for the preceding year to the Commission on a form prescribed by the executive secretary.

§309.163. Figerprinting.

(a)

Upon request, an association shall provide an employee on its security staff to take fingerprints for applicants for occupational licenses.

(b)

The association shall ensure that the designated employee is properly trained and is capable of taking fingerprints of a quality required by the Federal Bureau of Investigation.

§309.164. Accounting Practices.

(a)

An association shall maintain an accounting system under the supervision of a certified public accountant. The system must include detailed information regarding the purchase of goods for sale, inventory of goods held for sale, and goods sold. The system must indicate the unit of measure, the unit cost of items purchased and sold and in inventory and must provide adequate control and traceability without reconstruction of detailed records. The accounting system must be approved by the executive secretary.

(b)

An association shall ensure that all purse money and nomination race money is distributed in accordance with the Act, the rules of the Commission, the association's rules, and the conditions for the race for which the money is payable.

(c)

An association shall maintain a system of internal accounting controls approved by the executive secretary.

(d)

The Commission may review and conduct audits of all systems maintained under this section.

§309.165. Cooperation with Commission.

An association shall cooperate fully with the Commission and the Commission staff in the regulation of pari-mutuel racing and shall promptly provide any information requested by the Commission or the Commission staff.

§309.166.Race Information.

(a)

An association shall ensure that the race information disseminated by the association to the news media is accurate. The association shall make all reasonable efforts to correct any erroneous information transmitted by the association and any erroneous publication that is brought to the attention of the association.

(b)

An association shall provide a display board to inform the patrons of the results of the previous race performance.

§309.167. Organizational Chart.

(a)

Not later than 30 days before the first day of a race meeting, an association shall provide to the executive secretary an organizational chart which indicates the lines of authority, responsibility, and control for each operation of the association. The chart must include the name and title of key managers and supervisory personnel and their assistants and a brief description of their responsibility and authority.

(b)

The association shall provide to the executive secretary a revised organizational chart immediately on the termination or resignation of an individual or the reorganization of responsibilities, authority, or control.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904686

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Earliest possible date of adoption: September 12, 1999

For further information, please call: (512) 833-6699


Subchapter C. Horse Racetracks

1. Racetracks

16 TAC §309.201-309.215

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §6.061, which authorizes the Commission to adopt rules regulating the inappropriate and unsafe conditions at licensed racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.201.Applicability.

This subchapter applies to horse racetracks and to associations that are licensed by the Commission to operate a horse racetrack with pari-mutuel wagering.

§309.202.Track Length.

(a)

A racetrack must consist of an oval and a chute on the grandstand side of the oval. The racetrack may also have a chute on the back side of the oval at the opposite end of the oval from the grandstand side chute.

(b)

The oval must be, measured along a line three feet out from the face of the inside rail:

(1)

for a Class 1 racetrack, at least one mile in circumference;

(2)

for a Class 2 racetrack:

(A)

for a track not yet constructed, at least three-fourths mile in circumference;

(B)

for a track already constructed but for which the association proposed extensive track modification in its license application, at least three- fourths mile in circumference; and

(C)

for a track already constructed and for which the association proposed little or no track modification in its license application, at least five- eighths mile in circumference; and

(3)

for a Class 3 and 4 racetrack, at least five-eighths mile in circumference.

(c)

The length of the chute on the grandstand side, measured from the starting gate to the finish line, must be:

(1)

for a Class 1 racetrack, at least 550 yards; and

(2)

for a Class 2, 3 or 4 racetrack, at least 440 yards.

(d)

The length of a chute on the back side, measured from the starting gate to the finish line, must be:

(1)

for a one mile track, at least seven furlongs long;

(2)

for a three-fourths mile track, at least six furlongs long;

(3)

for a five-eighths mile track at a Class 2 racetrack, at least five furlongs long; and

(4)

for a five-eighths mile track at a Class 3 or 4 racetrack, at least four furlongs long.

(e)

The finish line of a racetrack must be at least 200 feet from the break of the first turn.

(f)

The radius of each turn in the oval must be approved by the executive secretary.

§309.203.Track Width.

A racetrack must be:

(1)

for a Class 1 racetrack, at least 90 feet wide on each straightaway and at least 80 feet wide on each turn;

(2)

for a turf racetrack, at least 80 feet wide on each straightaway and at least 80 feet wide on each turn; and

(3)

for a Class 2, 3 or 4 racetrack:

(A)

at least 30 feet wide on each straightaway for the first two horses in a race and an additional five feet wide for each additional horse in a race; and

(B)

not more than 10 feet narrower on each turn than on the straightaway.

§309.204.Elevation and Surface of Track.

(a)

The surface of the racetrack, including the cushion, subsurface, and base, must be constructed of materials and to a depth that adequately provides for the safety of the jockeys and the horses.

(b)

The elevation and surface must be approved by the executive secretary before the first race.

(c)

The elevation and surface are subject to periodic inspection. The executive secretary may develop a schedule for the periodic inspection of all the racetrack surfaces.

(d)

If an inspection reveals that the elevation or surface is not in compliance with the Rules or is not safe for racing, the executive secretary shall notify the association of the deficiencies and the recommended remedy. The association may not use the racetrack for live racing until the executive secretary has determined that the elevation and surface complies with the Rules and are safe for racing.

§309.205.Drainage.

(a)

An association shall provide for the racetrack a drainage system approved by the executive secretary.

(b)

If an association operates a turf racetrack, the drainage system must prevent water from running from the dirt racetrack onto the turf racetrack.

§309.206.Rails.

(a)

A racetrack, including a turf track, must have an inside and an outside rail of a type approved by the executive secretary. A turf track must have an outside rail that is separate from the inside rail of the adjacent dirt track. The inside rail of a turf track must be movable.

(b)

The top of the rail must be not less than 38 nor more than 42 inches above the top of the cushion.

(c)

The rail must be constructed of a material that will withstand the impact of a horse.

(d)

The rail posts must be spaced not more than 10 feet apart. The top rail must be smooth and continuous, with no jagged edges.

(e)

For a permanent rail, the rail posts must be set in concrete at least six inches below the top of the base to a depth of 36 inches. For a movable rail, the rail posts must be secured in a manner sufficient to withstand the impact of a horse.

§309.207.Maintenance of Track.

(a)

An association shall provide adequate maintenance equipment and personnel to restore the track surface to racing condition.

(b)

An association shall provide back-up equipment for maintaining the track surface.

(c)

An association that conducts races on a turf track shall:

(1)

maintain an adequate stockpile of growing medium; and

(2)

provide a watering system that is capable of watering from the inside and outside rails and of watering the entire turf track in not more than five hours.

§309.208.Gates.

(a)

A gate in a rail must appear similar to the rail. The top rail of the gate must be secured to the top rail.

(b)

A gate that is more than 10 feet long must have a center support.

(c)

An association shall ensure that all gates to the track are closed during a race.

(d)

Horse access gates must be placed at least 50 feet apart.

§309.209.Turf Access Path.

An access path from the inside rail to a turf track may not have rails along the path while a race is being conducted on the dirt track.

§309.210.Lighting.

(a)

An association shall provide lighting for the racetrack and the patron facilities that is adequate to ensure the safety and security of the patrons, licensees, and horses and to ensure the proper operation of the videotape and photofinish equipment. The lighting must be approved by the executive secretary.

(b)

An association shall provide additional lighting in the stable area, including adequate lighting in each stall and barn, and security lighting that is activated automatically.

§309.211.Obstacles.

(a)

An obstacle along the inside rail of a racetrack, including starting point markers and distance poles, must be placed at least 10 feet away from the bottom of the rail posts.

(b)

If a concrete drainage ditch is built behind the inside rail, the concrete must be covered with a soft material.

§309.212.Official's Stands.

(a)

An association shall provide adequate stands for officials to have an uninterrupted view of the racetrack.

(b)

If an association uses a patrol judge, the floor of the stand for the patrol judge must be at least six feet above the top of the track rail.

(c)

An association shall provide a clocker's stand in a location approved by the executive secretary.

§309.213.Starting Gates.

(a)

An association shall provide a padded starting gate approved by the executive secretary.

(b)

The starting gate for quarter horse racing must be capable of activating the timing device for the race.

(c)

An association shall maintain at least two operable starting gates during racing hours.

(d)

An association shall make at least one starting gate and qualified starting gate personnel available for schooling as often as necessary to accommodate the number of horses requiring schooling from the gate.

(e)

An association shall provide appropriate equipment to move the starting gate. The equipment must be kept at the racing strip while a race is being conducted. If a race is started at a place other than in a chute, the association shall provide backup equipment for moving the starting gate. The backup equipment must be kept at the same place as the primary moving equipment during the race.

§309.214.Distance Markers.

(a)

An association shall provide starting point markers and distance poles in accordance with this section.

(b)

The starting point markers and distance poles must be of a size and in a position to be clearly seen from the stewards' stand.

(c)

The starting point markers and distance poles must be marked as follows:

(1)

1/16 poles Black and white stripes

(2)

1/8 poles Green and white stripes

(3)

1/4 poles Red and white stripes

(4)

220 yards Green and white stripes

(5)

250 yards Blue

(6)

300 yards Yellow

(7)

330 yards Black and white stripes

(8)

350 yards Red

(9)

400 yards Black

(10)

440 yards Red and white stripes

(11)

550 yards Black and white stripes

(12)

660 yards Green and white stripes

(13)

770 yards Black and white stripes

(14)

880 yards Blue and white stripes

§309.215.Survey.

An association shall provide to the Commission before the first race a survey conducted by a licensed surveyor indicating the grade and distance measurements on the racetrack.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904687

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Facilities for Horses

16 TAC §§309.241-309.254

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §6.061, which authorizes the Commission to adopt rules regulating the inappropriate and unsafe conditions at licensed racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.241.Barns.

(a)

An association shall provide barns in a sufficient number for the anticipated number of horses.

(b)

The barns must be constructed of steel, concrete block, or masonry and must be appropriately spaced to ensure proper air circulation and to minimize fire hazards.

(c)

The association shall ensure that the barns are kept clean and in good repair. Each barn, including the test barn, must be well-ventilated and constructed to be comfortable in all seasons.

(d)

Each barn must be equipped with an adequate drainage system and one washrack with running water for every twelve stalls.

§309.242.Receiving Barn.

(a)

An association shall provide a conveniently located receiving barn for use by horses arriving for a race that are not to be housed on association grounds.

(b)

The barn must have a sufficient number of stalls for the anticipated number of horses.

§309.243.Stalls.

(a)

An association shall provide a sufficient number of stalls to house twice the anticipated number of starters per week of races. To comply with this subsection, an association may include in the total number of stalls the stalls located in the stable area, the receiving barn, and the stakes barn.

(b)

The stalls must be constructed of a fire-retardant material.

(c)

Except as otherwise provided by a rule of the Commission, a stall must have a floor area of at least 110 square feet and must be at least 10 feet wide.

(d)

The association shall provide a covered walkway along the front of each row of stalls. The walkway must be at least 10 feet wide and must be kept neat and clean at all times.

(e)

An association shall ensure that the area above each stall is kept open for proper ventilation.

§309.244.Accommodations for Stakes Races.

An association that conducts a stakes race shall provide adequate barn space for housing horses entered in a stakes race.

§309.245.Manure Removal.

(a)

An association shall provide an adequate area for the placement of manure removed from the stalls.

(b)

An association shall promptly remove the manure from the stable area.

(c)

An association shall ensure that refuse from the stalls and other refuse are kept separate.

§309.246.Hay and Feed Storage.

(a)

An association shall provide an area for storing hay other than in a barn where a horse is housed. The area must be covered and well-ventilated.

(b)

An association shall ensure that feed other than hay is stored in a permanent container or a room designed for that purpose.

§309.247.Maintenance of Common Areas.

An association shall ensure that each area and all equipment that is subject to contact by different horses is kept clean and free of dangerous objects.

§309.248.Pre-race Holding Area.

(a)

An association shall provide a pre-race holding area that is adjacent to the Commission veterinarian's office.

(b)

The area must be covered, well-ventilated, and safe for the horses and the individuals who handle the horses. The association shall ensure that all posts or obstacles are padded.

(c)

The area must be equipped with:

(1)

a walk ring;

(2)

at least 12 stalls; and

(3)

an office for the horse identifier.

(d)

The area must have only one entrance that is locked or guarded at all times.

§309.249.Paddock.

(a)

An association shall provide a paddock.

(b)

The paddock must be completely enclosed with a fence. The paddock entrance(s) must be locked or guarded at all times during live racing.

(c)

If the paddock has stalls, the stalls must be constructed to ensure the safety of the horses and the individuals who handle the horses.

(d)

During a race performance, the association shall provide the services of a farrier in the paddock.

§309.250.Test Barn.

(a)

An association shall provide a test barn for taking specimens for testing. The barn must be adjacent to the Commission veterinarian's office.

(b)

The barn must be shielded from the noise and excitement of the races.

(c)

The barn must be clean, sanitary, and safe for the horses and the individuals who handle the horses.

(d)

The barn must be equipped with:

(1)

a walk ring;

(2)

at least four enclosed stalls, equipped with dutch doors and observation windows;

(3)

a washrack that is large enough to accommodate two horses at the same time; and

(4)

disinfected water buckets for drinking water.

(e)

An association shall provide restroom facilities for the test barn employees in close proximity to the test barn.

(f)

The area must have only one entrance that is locked or guarded at all times.

§309.251.Isolation Area.

(a)

An association shall provide an isolation area for treating a horse that may have a communicable disease.

(b)

The isolation area must have stalls constructed of concrete block or masonry with a concrete floor for proper cleaning and disinfection. Each stall must have a floor area of at least 144 square feet and be at least 12 feet wide. The isolation area must have at least four stalls.

(c)

The isolation area must be equipped with:

(1)

a drain;

(2)

a waste disposal system;

(3)

a treatment area with horse stocks;

(4)

a sink with hot and cold water; and

(5)

a locked storage area.

(d)

The isolation area must be cleaned and disinfected regularly under the direction of the Commission veterinarian.

§309.252.Treatment Area.

(a)

An association shall provide a treatment area for providing emergency care to a horse that is injured in racing or training.

(b)

The treatment area must be centrally located in the stable area and must be clean and well-ventilated.

(c)

The treatment area must be equipped with:

(1)

a sink with hot and cold water;

(2)

at least one set of horse stocks;

(3)

a locked storage area;

(4)

at least two stalls;

(5)

an overhead hoist to transfer a horse from an ambulance to a stall; and

(6)

a dark room and radiograph processing area for developing x-rays.

(d)

An association shall provide and maintain the equipment and solutions used in developing x-rays.

§309.253.Postmortem.

(a)

An association shall provide a postmortem area.

(b)

The area must be located in a secluded area and must allow access by an equine ambulance.

(c)

The area must be equipped with:

(1)

a cover;

(2)

a concrete or asphalt slab with a rough finish;

(3)

adequate drainage;

(4)

hot and cold water and a hose; and

(5)

a locked storage area.

(d)

An association shall provide services for the disposal of a horse that dies at the racetrack.

§309.254.Equine Ambulance.

(a)

An association shall provide an equine ambulance and trained personnel on association grounds on each day that the racetrack is open for racing or exercising.

(b)

The ambulance must be properly ventilated and kept in the shade at an entrance to the racing strip when not in use.

(c)

The ambulance must be a large, covered and enclosed vehicle that is low to the ground. The ambulance must be able to:

(1)

navigate on the racetrack during all weather conditions; and

(2)

transport a horse off the association grounds.

(d)

The ambulance must be equipped with:

(1)

large, portable screens to shield a horse from public view;

(2)

ramps to load a horse;

(3)

adequate means of loading a horse that is down;

(4)

a rear door and a door on each side;

(5)

a padded interior;

(6)

a movable partition to initially provide more room to load a horse and to later restrict a horse's movement;

(7)

a shielded area for the individual handling the horse;

(8)

a storage area for supplies;

(9)

a front leg Kimzey brace or an equivalent approved by the Commission veterinarian; and

(10)

a water supply to treat heat exhaustion.

(e)

If the ambulance is being used to transport a horse, the association may not conduct a race until the ambulance is replaced.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904688

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


3. Facilities for Licensees

16 TAC §309.281, §309.282

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §6.061, which authorizes the Commission to adopt rules regulating the inappropriate and unsafe conditions at licensed racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.281.Jockeys.

(a)

An association shall provide facilities for jockeys scheduled to ride in a race.

(b)

The facilities must be equipped with:

(1)

showers, toilets, and sinks;

(2)

locked storage areas;

(3)

a snack bar;

(4)

equipment appropriate for the rest and recreation of the jockeys; and

(5)

other accommodations requested by the Commission.

(c)

The association shall provide equivalent facilities for men and women jockeys.

§309.282.Living Quarters for Licensees.

(a)

If an association permits licensees to reside on association grounds, the association shall provide living quarters for the licensees.

(b)

The living quarters must be in a permanent structure and be adequate to house the anticipated number of licensees who will be living on association grounds. The association must provide equivalent facilities for men and women licensees.

(c)

The living quarters must be equipped with:

(1)

windows that open;

(2)

heating;

(3)

hot and cold water; and

(4)

showers, toilets, and sinks.

(d)

An association may not permit an individual to sleep in the stable area except:

(1)

in a facility provided in accordance with this section;

(2)

in a barn that was constructed after 1990 of fire retardant materials; or

(3)

in a tack room that was constructed after 1990 of fire retardant materials, provided the tack room has a window that opens.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904689

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


4. Operations

16 TAC §§309.291-309.299

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §3.13, which authorizes the Commission to adopt rules providing the criteria and process for the selection of an organization to represent members of a segment of the racing industry; §3.22, which authorizes the Commission to adopt rules relating to the horsemen's account; and §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.291.Racing Hours.

Except on approval of the executive secretary, an association may conduct horse racing only between the hours of 8 a.m. and 12 midnight.

§309.292.Number of Races.

Except on approval of the executive secretary, an association may not offer more than 12 races per performance.

§309.293.Saddle Cloth.

(a)

An association shall provide a saddle cloth and head number to each horse scheduled in a race. The saddle cloth must have a number printed on the side that is large enough to be read clearly from the stewards' stand and the photofinish tower.

(b)

The association may provide to each jockey racing colors and shall provide a sleeve number or helmet number.

§309.294.Starting Crew.

An association shall provide a starting crew for each race to assist in handling the horses in the starting gates. The association shall provide a sufficient number of assistant starters for the number of horses to start in a race.

§309.295.Condition Book.

An association shall deliver to the Commission a copy of the first condition book for a race meeting at least 10 days before the first day of the race meeting. The association shall deliver to the Commission on publication a copy of each subsequent condition book published by the association.

§309.296.Official Program.

(a)

For each race day, an association shall prepare an official program. The official program must contain the order of the races on that day and:

(1)

for each race:

(A)

the names of the horses in the race;

(B)

the conditions of the race;

(C)

the distance of the race;

(D)

the probable odds on each horse;

(E)

the value of the race;

(F)

the claiming prices, if applicable; and

(G)

the types of wagers to be offered for that race; and

(2)

for each horse listed in the program:

(A)

the post position;

(B)

the age, color, sex, and breeding;

(C)

the jockey, trainer, owner or stable name, and racing colors;

(D)

the weight carried; and

(E)

if the horse is eligible for participation in the Texas Bred Incentive Program, the name or logo of the appropriate official breed registry.

(b)

The official program must contain the names of the officials serving on that day, the names of the association's management personnel, and any other information required by the executive secretary.

(c)

Except as otherwise provided by this subsection, for each horse that is racing with furosemide (Lasix) the official program shall indicate that fact by including the symbol "L" after the horse's name. For each horse that is racing with furosemide (Lasix) for the first time, the official program shall indicate that fact by including the symbol "L1" after the horse's name. For each horse that is racing without furosemide (Lasix) for the first time after having been admitted to the furosemide (Lasix) program in this state and for each horse that is racing without furosemide (Lasix) in this state whose most recent start was with furosemide (Lasix) in another racing jurisdiction, the official program shall indicate that fact by including the symbol "Lx" after the horse's name.

§309.297.Purse Accounts.

(a)

All money required to be set aside for purses, whether from wagering on live races or on simulcast wagering, are trust funds held by an association as custodial trustee for the benefit of horsemen. No more than three business days after the end of each week's wagering, the association shall deposit the amount set aside for purses into purse accounts maintained by breed by the horsemen's organization in one or more federally or privately insured depositories.

(b)

Purse money for a completed race shall be made available to the horsemen's bookkeeper on or before the third day after the week's races have run. The horsemen's bookkeeper shall distribute purse money for a race to the accounts of the persons entitled to the money immediately after the executive secretary advises the horsemen's bookkeeper that the race has been cleared for payment.

(c)

If an association fails to run live races during any calendar year, all money in the respective breed's purse account may, at the discretion of the horsemen's organization be distributed as follows:

(1)

first, payment of earned but unpaid purses; and

(2)

second, subject to the approval of the horsemen's organization, transfer after the above mentioned calendar year period of the balance in the respective breed's purse account to the respective breed's purse account for one or more other association.

(d)

If an association ceases a live race meet before completion of the live race dates granted by the Commission, the funds in and due the respective breed's purse account shall be distributed as follows:

(1)

first, payment of earned but unpaid purses;

(2)

second, retroactive pro rata payments to the horsemen if provided by contract with the horsemen's organization; and

(3)

third, subject to the approval of the horsemen's organization, transfer within 120 days after cessation of live racing of the balance in the respective breed's purse account to the respective breed's purse account for one or more other associations.

(e)

The Commission may at any time inspect, review, or audit the records and performance of the association, the horsemen's organization, or the horsemen's bookkeeper to determine compliance with this section.

(f)

No part of any funds allocated to any race or races from the purse fund shall be subject to any surcharge, promotion fee, advertising fee, or expense by the association for any reason whatsoever.

§309.298.Stakes and other Prepayment Races.

(a)

An association shall file with the Commission, for approval, a copy of the race conditions and the nomination blank for all stakes or other prepayment races before distributing the conditions to the public.

(b)

The nomination blank must state all conditions of the race, including:

(1)

the payment schedule;

(2)

the dates and conditions for the race and any trials;

(3)

the source and amount of any added money;

(4)

the distribution of all funds paid into the race, including the percentages allocated for advertising, administration, and other expenses;

(5)

terms for obtaining refunds, if any; and

(6)

all other conditions pertaining to the race.

(c)

The association shall maintain one account in an F.D.I.C. secured financial institution, for which only funds received for stakes and other prepayment races may be deposited, except as otherwise authorized by these rules. The account must require, for all withdrawals, the signatures of two officers of the association.

(d)

The association shall designate an official as the stakes nomination secretary who shall be responsible for the collection and deposit of all stakes, nomination, futurity and derby payments, preparation of the list of horses and their owners nominated for stakes, nomination, futurity and derby races and serving as the point of contact for the Commission staff for questions or information regarding stakes and other prepayment races. The association shall include the name of the person designated as the stakes nomination secretary in the list of officials prepared pursuant to §313.4 of this title (relating to Approval of Officials). The association shall include the person designated as the stakes nomination secretary in an insurance policy or fidelity bond covering employee dishonesty.

(e)

Not later than five business days after receiving a request by the Commission, the association shall provide to the Commission a list of all horses nominated for the race, distinguishing which horses remain eligible as of the date of the request and the names of all owners of each horse remaining eligible.

(f)

Not later than five business days after receiving a request by the Commission, the association shall provide a written report to the Commission regarding the activity and status of the escrow account in which the race funds are maintained. The report must include the name of the financial institution in which the account is held, the dates and amounts of deposits into the account by each nominator or sponsor, the dates and amounts of all withdrawals or deductions from the account, and for what purpose each withdrawal or deduction was made.

(g)

Not later than five business days after receiving a request from the Commission, the horsemen's bookkeeper shall provide to the Commission the final report for the distribution of the purse for stakes and other prepayment races. The final report must state how the purse was distributed to each purse winner, including the address to which a check was mailed or the date on which winnings were deposited in the appropriate horsemen's account.

§309.299.Horsemen's Representative.

(a)

Findings. The Commission finds a need for horse owners and trainers to negotiate and covenant with associations as to the conditions of live race meetings, the distribution of purses not governed by statute, simulcast transmission and reception, and other matters relating to the welfare of the owners and trainers participating in live racing at an association. To ensure the uninterrupted, orderly conduct of racing in this state, the Commission shall recognize one organization to represent horse owners and trainers on matters relating to the conduct of live racing and simulcasting at Texas racetracks.

(b)

Recognition Process.

(1)

To request Commission recognition as a horsemen's representative organization, the organization must file a written request for recognition on a form prescribed by the executive secretary. The executive secretary shall establish a deadline for filing a request under this paragraph and publish that deadline in the Texas Register at least 20 days before the deadline.

(2)

To be eligible for recognition as a horsemen's representative organization, each officer and director of the organization during the term of the recognition must be licensed by the Commission as an owner or trainer.

(3)

If only one organization requests recognition, the executive secretary shall issue a letter of recognition to the organization, subject to the approval of the Commission. If more than one organization requests recognition, the Commission shall recognize the organization that is best qualified to represent the horse owners and trainers for the various breeds participating in racing at all the racetracks in this state. The executive secretary may require each organization requesting recognition to supply additional information regarding its structure, membership, and programs. The Commission shall consider the following when determining which organization to recognize under this section:

(A)

the experience and qualifications of the directors, executive officers, and other management personnel of the organization;

(B)

the organization's benevolence programs for its membership and others participating in racing in this state; and

(C)

the degree to which the organization's membership represents a fair and equitable cross-section of the horse owners and trainers participating at each of the racetracks in this state.

(4)

Recognition given under this section is valid for two years.

(c)

Authority and Responsibilities.

(1)

An organization recognized under this section shall negotiate with each association regarding the association's live racing program, including but not limited to the allocation of purse money to various live races, the exporting of simulcast signals, and the importing of simulcast signals during live race meetings.

(2)

An organization recognized under this section may inspect and audit an association's horsemen's purse accounts.

(3)

An organization recognized under this section shall provide to the Commission on request a copy of the organization's most recent financial statements, minutes of board meetings, literature provided to its members, and any other records or information relating to the functions of the organization at Texas racetracks.

(4)

An organization recognized under this section may not counsel or encourage its members to strike, embargo, boycott or employ similar tactics in dealing with an association.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904690

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter D. Greyhound Racetracks

1. Facilities and Equipment

16 TAC §§309.301-309.316

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §6.061, which authorizes the Commission to adopt rules regulating the inappropriate and unsafe conditions at licensed racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§309.301. Applicability.

This subchapter applies to greyhound racetracks and to associations licensed by the Commission to operate a greyhound racetrack.

§309.302. Track Specifications.

(a)

A greyhound racetrack must be an oval track with a minimum width of 22 feet from the inside curb to the outside curb.

(b)

On the first turn, the radius from the center of the oval to the inside rail of the track must be 128 feet. On the second turn, the radius from the center of the oval to the inside rail of the track must be 118 feet. Each straightaway must be 285 feet long.

(c)

The banking of the track must be approved by the executive secretary.

§309.303. Track Surface.

(a)

The track must consist of a clay base with a surface of a nonabrasive sand with low elasticity or of a comparable material.

(b)

An association shall maintain the track surface and the banking in a uniform condition to foster the safety of the greyhounds.

(c)

The surface must be approved by the executive secretary before the first race of each race meeting and is subject to periodic inspections and verification by the Commission. The executive secretary may require periodic reporting by an association regarding the track surface and may require the reports to contain any information considered by the executive secretary to be essential to evaluating the current status of the track surface.

§309.304. Watering Equipment.

(a)

An association shall provide a watering system approved by the executive secretary to water the track surface uniformly.

(b)

If an association uses a water tank vehicle with a boom, the track must be sufficiently wide to allow the vehicle to travel along the outside edge of the track without disturbing the portion of the track on which the greyhounds run.

§309.305. Starting Boxes.

(a)

An association shall provide and maintain at least two starting boxes approved by the executive secretary. Each starting box must be equipped with an automatic opener with a manual back-up.

(b)

The association shall periodically inspect each starting box to ensure its safe and effective operation. When the track is being used for racing or schooling, the association shall have at least one person present on association grounds who is skilled and qualified to maintain the starting boxes.

(c)

An association shall ensure that the starting box located at the five- sixteenths start is set back in the chute.

§309.306. Escapes.

An association shall provide on the racetrack two curtains located at least 50 feet on either side of each escape. The curtains must not interfere with the greyhounds during the course of a race.

§309.307. Lures.

An association shall provide an inside dual equipped lure with an extendable arm.

§309.308. Video Monitoring System.

In addition to other video requirements in the rules of the Commission, an association shall provide a video monitoring system approved by the executive secretary that permits the racing judges to view the activities in the lockout kennel, the movement of the leadouts and greyhounds from the lockout kennel to the starting boxes, and the activities at the starting boxes.

§309.309. Lockout Kennel.

(a)

An association shall provide a lockout kennel that:

(1)

is soundproof, to prevent noise from disturbing the greyhounds that are waiting to race;

(2)

is air-conditioned sufficiently to maintain a temperature between 68 and 75 degrees Fahrenheit;

(3)

has sealed or ceramic floors and walls to permit proper cleaning and disinfection; and

(4)

has a one-way viewing window to allow the trainers and patrons to view the interior of the lockout kennel.

(b)

Each crate located in the lockout kennel must:

(1)

be constructed of a smooth, hard material, such as stainless steel or tile;

(2)

be at least three feet wide, four feet deep, and four feet high;

(3)

be equipped with casters for rolling;

(4)

be located on the floor level to prevent greyhounds from sustaining jumping injuries;

(5)

have a door that leaves a one-inch clearance on each side to prevent injury to a greyhound's tail or feet; and

(6)

have a drop latch or a comparable latch on the door.

(c)

An association shall provide a comfortable room adjacent to the lockout kennel in which a kennel owner or trainer may view the race and view the interior of the lockout kennel.

(d)

An association shall provide an area adjacent to the lockout kennel in which a greyhound can wait to weigh-in and cool down following a race or wait for schooling races. The area must:

(1)

be large enough to comfortably accommodate 100 greyhounds and the leadouts and trainers;

(2)

be adequately shaded and fenced to shield the greyhounds' view of the racetrack;

(3)

have eight water faucets with hoses;

(4)

have a disinfected dipping vat, approved by the Commission veterinarian, through which a greyhound may be walked to assist in cooling down following a race; and

(5)

have adequate drainage.

§309.310. Walkway.

An association shall provide a properly lighted covered walkway with four feet of turf or a comparable material on each side of the walkway from the kennel compound to the lockout area.

§309.311. Kennel Compound.

(a)

An association shall provide in the kennel compound area:

(1)

not more than 18 separate kennel buildings for the kennel owners under contract with the association; and

(2)

a separate kennel building for greyhounds that will be participating in stake races, designed to accommodate several trainers and their greyhounds.

(b)

Each kennel building must be located at least 100 yards from the public area of the enclosure and at least 150 yards from the nearest racetrack surface.

(c)

The kennel buildings must be spaced at least 100 feet apart to ensure proper air circulation and to minimize fire hazards.

(d)

The association shall provide at its expense a continuous security system for the kennel compound area approved by the executive secretary. The security system must include floodlights to adequately illuminate the kennel compound at night.

§309.312. Turnout Pens.

Each kennel building must have at least three turnout pens. Each pen must:

(1)

be free of any obstructions;

(2)

measure at least 20 feet by 40 feet;

(3)

have gates that connect to the other pens;

(4)

have at least a 15 foot overhang from the building;

(5)

have at least two halogen lights of 300 watts each located at each end;

(6)

be surrounded by a fence at least six feet high, of which the lower 32 inches is constructed of cinder block or a comparable material and the remaining portion is constructed of chain link;

(7)

have a gate adequate to accommodate a vehicle to remove the sand and deposit new sand;

(8)

have adequate water faucets and drainage; and

(9)

have a minimum of 12 inches of sand or a comparable material that is replaced at least every 3 months.

§309.313. Kennel Buildings.

(a)

Each kennel building must measure at least 20 feet by 70 feet on the inside of the building. The building must be partitioned into a kitchen area of at least 17 feet by 20 feet and a crate area of at least 20 feet by 53 feet.

(b)

An association shall ensure that the kennel buildings are kept clean and in good repair. Each kennel building must be well-ventilated and constructed to be comfortable in all seasons.

(c)

Each kennel building must be furnished with 60 crates constructed of stainless steel or a comparable material. Each crate must:

(1)

have a drop latch or a comparable latch;

(2)

be on casters; and

(3)

measure at least three feet wide, four feet deep, and three feet high.

(d)

The kitchen area must be equipped with at least a 30-gallon hot water heater, a deep double sink with drainboard, an elevated tub with a waterproof splash board, a restroom with a shower, and adequate shelving and cabinet space.

(e)

Each kennel building must have at least two floor drains in the crate area and at least one floor drain in the kitchen area.

(f)

Each kennel building must be equipped with:

(1)

a temperature, smoke, and fire alarm system equipped with a sprinkling system and an alarm to the association security and city or county fire department;

(2)

adequate lighting inside the building;

(3)

at least four horizontal windows that each measure one foot by four feet;

(4)

adequate emergency power to protect greyhounds during power failures or hurricanes; and

(5)

adequate climate control equipment that is monitored by the kennel owner or trainer.

(g)

An association may not permit:

(1)

more than 60 greyhounds to be housed in a kennel building; or

(2)

more than one greyhound to be housed in a crate.

§309.314. Sprint Path.

An association shall provide, for every three kennel buildings, a sprint path located adjacent to the kennel compound area. The sprint path must:

(1)

be at least 30 feet wide and 400 feet long;

(2)

be divided down the middle by a chain link fence;

(3)

have at least one gate on each end for entering or exiting with greyhounds;

(4)

have a driveway along the side;

(5)

have a base and surface comparable to the racetrack surface; and

(6)

be maintained by the association at all times.

§309.315. Test Area.

An association shall provide and maintain a test area in the location approved by the executive secretary for the purpose of obtaining for analysis specimens of greyhound body fluids and eliminations as required by Chapter 319 of this title (relating to Veterinary Practices and Drug Testing).

§309.316. Emergency Care Facility.

An association shall provide a veterinary facility to provide emergency care to injured or stressed animals. The association shall equip and maintain the facility with the equipment and materials approved by the Commission veterinarian.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904691

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Operations

16 TAC §§309.351-309.364

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §10.06, which describes the requirements for kennel contracts.

The proposal implements Texas Civil Statutes, Article 179e.

§309.351. Kennel Contracts.

(a)

In contracting with a kennel owner, an association shall use a contract approved by the Commission.

(b)

An association shall file a copy of each kennel contract with the Commission.

(c)

An association shall deliver a copy of the kennel contract to each party to the contract.

(d)

Under a contract with a kennel owner, an association may not charge the kennel owner for providing any services or facilities other than electricity.

(e)

An association may not contract with a kennel owner if the kennel owner or a member of the kennel owner's immediate family owns an interest in the association.

§309.352. Texas Preference.

(a)

In contracting with kennel owners for kennel contracts, an association shall ensure that at least 50 percent of the kennels with whom the association contracts are wholly owned by Texas residents.

(b)

In this section, "Texas resident" means an individual who has resided in Texas for the five-year period preceding the date the kennel contract is signed.

§309.353. Dismissal of Kennel.

(a)

An association may dismiss a kennel only:

(1)

on revocation by the Commission of the kennel owner's license;

(2)

for repeated violations of the Act or a Rule; or

(3)

for poor performance, as provided by subsection (b) of this section.

(b)

A contract between an association and a kennel owner must provide a uniform dismissal clause. The clause must state the following:

(1)

if a kennel has been continuously booked at the association for more than two years, the association shall dismiss a kennel if the kennel's win record is in the bottom four positions at the end of a race meeting for two of the past three years and the association may not rebook the kennel for a period of five years;

(2)

the association may place a kennel on probation by written notice if the kennel's win record is in the lowest three positions during each of the three preceding months;

(3)

an association may place a kennel on probation by written notice if the kennel is in breach of the kennel contract in a manner that materially affects the rights or privileges of the association; and

(4)

an association may dismiss a kennel on probation if during the three-month period following the beginning of probation, the kennel fails to cure the breach or fails to place higher than at least three other kennels.

(c)

A kennel owner may apply to the Commission for an exemption from the operation of the uniform dismissal clause. The kennel owner must demonstrate to the Commission that the kennel's failure to perform as required by the contract was due to a force majeure.

(d)

For the five-year period after a kennel is dismissed pursuant to this section, an association may not book another kennel that is owned substantially by the same owners as the dismissed kennel. For purposes of this subsection, "substantially" means more than a 50% ownership interest in the kennel.

§309.354. Stakes Entry.

An association shall release a greyhound to participate in stake races. On completion of the stake races, the greyhound must return to the association grounds.

§309.355. Grading System.

(a)

The racing secretary for an association shall grade the greyhounds for the races in accordance with this section.

(b)

Before the first day of a race meeting, the racing secretary shall classify the greyhounds and assign an appropriate grade. In assigning the grades, the secretary shall consider the greyhound's past performances.

(c)

The racing secretary shall use seven grades of AA, A, B, C, J, D, and M. Grade M is for maidens and Grade J is for winning maidens.

(d)

The racing secretary shall lower a greyhound to the next lower grade, including lowering a grade J to a grade D, if the greyhound:

(1)

fails to finish in the top three positions in three consecutive starts;

(2)

fails to earn better than one third place finish in four consecutive starts; or

(3)

fails, as a Grade J, to finish in the top four positions in four consecutive starts.

(e)

The racing secretary shall advance a greyhound that wins a race graded A, B, C, J, or D.

(f)

The racing secretary shall advance a greyhound that wins a maiden race to Grade J. The racing secretary shall advance a greyhound that wins a Grade J race to Grade C. On request by a kennel owner or trainer, the racing secretary may advance a greyhound that finishes second, third, or fourth in a maiden or a Grade J race to Grade C. For a greyhound regraded on request under this subsection, an association shall place the letter "M" or "J" after the greyhound's name in the racing program.

(g)

An association shall drop a greyhound from further racing at that race meeting if the greyhound fails to finish in the top four positions in four consecutive starts in Grade D. At the discretion of the racing secretary, a greyhound dropped from racing at Grade D may be requalified after a period of 30 days.

(h)

A greyhound that falls in a race is considered a starter in that race and shall comply with the conditions set forth in subsection (d) of this section, unless lowering the greyhound would require the greyhound to be dropped from further racing in that race meeting.

(i)

For a greyhound that transfers to the racetrack from another racetrack during a race meeting, the racing secretary shall assign a grade that is appropriate for the greyhound's ability considering the competition at the racetrack and at the racetrack from which the greyhound transfers.

(j)

The racing secretary may regrade a greyhound that has not raced for at least 30 days.

(k)

During a greyhound's first three starts, the racing secretary may regrade the greyhound only once and only to a next higher or lower grade level.

(l)

The racing secretary may schedule only four mixed grade races each week. A mixed grade race must be designated by the letter "T" in the racing program.

(m)

A stake race must be designated by the letter "S" in the racing program.

(n)

An association may not require a kennel owner to furnish a greyhound of a specific grade or for a specific distance.

(o)

A greyhound that has advanced from Grade M and has been dropped from further racing without winning another official start may be requalified after a period of 30 days.

(p)

If a maiden fails to finish in the top four positions in six consecutive starts, the maiden may not race again at the race meeting until it requalifies. If the maiden fails to finish in the top four positions in the two starts after requalifying, the maiden may not race again at the race meeting.

§309.356. Draw and Post Position Assignment.

(a)

An association shall draw the entries and assign post positions at random.

(b)

An association shall adequately post the date and time for drawing entries and assigning post positions to permit the kennel owners or trainers to attend.

(c)

An association may not draw the entries and assign post positions unless a kennel owner or trainer and a racing judge are present.

(d)

Immediately after drawing the entries for a performance, the association shall publish a list of the greyhounds not drawn. The association shall post the list in a place available for viewing by kennel owners and trainers. In drawing the entries for the next performance, the association shall give priority to the greyhounds on the list. The association shall maintain on the list a balance of greyhounds in different grades.

§309.357. Schooling.

(a)

An association shall use standard schooling procedures.

(b)

An association shall provide:

(1)

unlimited unofficial schooling at least two mornings per week; and

(2)

unlimited official schooling at least two nights per week.

(c)

The association may not conduct an official schooling race unless at least two racing judges are present at least 30 minutes before the start of the race and during the race.

§309.358. Racing Restricted.

An association may not permit a greyhound, other than a greyhound entered in a stake race, to race or be schooled on association grounds unless the greyhound is permanently housed on association grounds.

§309.359. Live Lures.

(a)

An association may not permit the use of a live lure on association grounds.

(b)

An association may not permit a greyhound to be kennelled or to race on association grounds if the association knows or can reasonably be expected to know that the greyhound was trained in a state that by statute or rule does not prohibit the knowing use of live lures.

§309.360. Marathons.

(a)

A race that is more than three-eighths of a mile long is considered a marathon.

(b)

An association may schedule a marathon race only when the kennel owners or trainers enter with the racing secretary a sufficient number of greyhounds that are capable of running the distance.

§309.361. Kennel Account.

(a)

An association shall maintain a separate bank account known as the "kennel account". The association shall maintain in the account at all times a sufficient amount to pay all money owed to kennel owners for purses, stakes, rewards, and deposits.

(b)

An association shall employ a bookkeeper to maintain records of the kennel account.

(c)

All transactions relating to the kennel account are subject to audit by the Commission.

(d)

Except as otherwise provided by these rules, an association shall pay the purse money owed from a race to those who are entitled to the money not later than 10 days after the date of the race.

§309.362. Number of Greyhounds.

An association may not permit more than eight greyhounds to start in a race.

§309.363. Official Program.

(a)

For each race day, an association shall prepare and print an official program. The official program must contain the order of the races on that day, the distance and track record for each race, and the names of the greyhounds scheduled to run in each race, in order of their post positions. The post positions must be designated by numbers placed at the left and in line with the names of the greyhounds.

(b)

The official program must contain at least two past performances for each greyhound scheduled to race. The program must also contain, for each greyhound scheduled to race:

(1)

the name;

(2)

color;

(3)

sex;

(4)

date of whelping;

(5)

breeding;

(6)

established racing weight;

(7)

number of starts in official races;

(8)

number of times finishing first, second, and third;

(9)

name of owner and lessee, if applicable;

(10)

name of trainer; and

(11)

other information to enable the public to properly judge the greyhound's ability.

(c)

If the name of a greyhound is changed, the new name, together with the former name, shall be published in the official entries and program until after the greyhound has started six times under the new name.

§309.364. Identification System.

(a)

An association shall maintain a card index system or identification for each greyhound racing for the association. An association may not permit a greyhound to be housed on association grounds unless the greyhound is identifiably tattooed in each ear.

(b)

Each bertillion card must be legible and thoroughly identifiable for each greyhound. The card must show:

(1)

the name of the kennel; and

(2)

the color, sex, tattoo identifications located in each ear, and characteristic markings, scars, and other identification features of the greyhound.

(c)

The paddock judge shall maintain the bertillion cards. For each greyhound removed from association grounds, the paddock judge shall maintain the bertillion card for the greyhound in an inactive file for the six-month period after the date of the greyhound's removal.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904712

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Chapter 311. Conduct and Duties of Individuals

The Texas Racing Commission proposes the repeal of Chapter 311 relating to the Conduct and Duties of Individuals in conjunction with its review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, §55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (section). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees. It is proposed that Chapter 311 be repealed and replaced with a new Chapter 311 which will regulate the licensing and conduct of occupational licensees. The sections in Chapter 305 relating to the licensing and conduct of occupational licensees will be incorporated into the new Chapter 311.

As part of the reorganization of the Commission rules, the agency is complying with the §167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the rules are repealed there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the rules are repealed the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. There will be no fiscal implications for small businesses and micro-businesses as a result of enforcing this repeal. There is no anticipated economic cost to an individual required to comply with the repeal as proposed. The proposal has no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

Subchapter A. General Provisions

16 TAC §§311.1-311.16

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§311.1. Applicability.

§311.2. Best Effort.

§311.3. Ineligible Participant.

§311.4. Bribes Prohibited.

§311.5. Wagering.

§311.6. Influence of Race Prohibited.

§311.7. Inhumane Treatment.

§311.8. Performance Information.

§311.9. Information to Commission.

§311.10. Conduct.

§311.11. Weapons Prohibited.

§311.12. Duty to Wear Badge.

§311.13. Rehabilitation.

§311.14. Accident Reports.

§311.15. Financial Responsibility.

§311.16. Contraband.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904703

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter B. Specific Licenses

1. General Provisions

16 TAC §§311.101-311.104, 311.106, 311.107

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§311.101. Absolute Insurer.

§311.102. Change of Ownership.

§311.103. Health Reports by Trainer.

§311.104. Owner Suspended.

§311.106. Stable Names.

§311.107. Discharge of Employee.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904704

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Licenses for Horse Racing

16 TAC §§311.151-311.159

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§311.151. Change of Trainer.

§311. 152. Trainer Employees.

§311.153. Owner/Trainer.

§311.154. Suspended Trainer.

§311.155. Reporting to Clocker.

§311.156. Jockeys.

§311.157. Trainer Absent.

§311.158. Restrictions on Racing.

§311.159. Conduct in Stable Area.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904705

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


3. Licensees for Horse Racing

16 TAC §§311.171-311.174

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§311.171. Kennel Owners.

§311.172. Use of Texas-bred Greyhounds.

§311.173. Leadouts.

§311.174.Restrictions on Placement in Kennels.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904706

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter C. Alcohol and Drug Testing

1. Drugs

16 TAC §§311.201-311.208

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§311.201. Possession and Use Prohibited.

§311.202. Subject to Testing.

§311.203. Method of Selection.

§311.204. Taking of Specimens.

§311.205. Security of Specimens.

§311.206. Medical Review Officer.

§311.207. Confidentiality of Results.

§311.208. Penalties.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904707

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Alcohol

16 TAC §§311.221-311.223

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal of these sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act.

The proposal implements Texas Civil Statutes, Article 179e.

§311.221. Prohibited Conduct.

§311.222. Breathalyzer or Other Test.

§311.223. Penalties.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904708

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Chapter 311. Other Licenses

The Texas Racing Commission proposes the new Chapter 311, §§311.1-311.7, 311.51, 311.101-311.110, 311.201-311.216, 311.301-311.308, 311.321-311.323, relating to the licensing and regulation of occupational licensees in conjunction with its review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, Section 55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (§167). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees. This new proposed Chapter 311 will regulate the licensing and conduct of occupational licensees. The sections in Chapter 305 relating to the licensing and conduct of occupational licensees will be incorporated into the new Chapter 311.

As part of the reorganization of the Commission rules, the agency is complying with the §167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding. To assist in the review of new Chapter 311, a derivative table and disposition table may be requested from the Commission. These tables will show whether an old rule has been amended, repealed or merely renumbered and the derivation of the new rules.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rules are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas, 78711-2080.

Subchapter A. Licensing Provisions

1. Occupational Licenses

16 TAC §§311.1-311.7

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §5.01, which authorizes the commission to prescribe reasonable license fees for each category of license; §5.03, which authorizes the commission to obtain fingerprints from license applicants; §5.04, which describes the requirements relating to the release of criminal history information; §7.02, which authorizes the commission to adopt categories of occupational licenses and to establish the criteria for those licenses; §7.05, which authorizes the commission to adopt a fee schedule for occupational licenses; §7.06, which requires the commission to issue identification cards to occupational licensees; §7.07, which authorizes the commission to set a time period in which a license will be valid, not to exceed 36 months; §7.09, which authorizes the commission to issue temporary licenses pending investigation of an applicant's qualifications; §7.10, which authorizes the commission to waive the fingerprinting requirements for any license applicant and §14.18, which authorizes the Commission to perform administrative searches at licensed racetracks and adopt rules regarding such searches and seizures.

The proposal implements Texas Civil Statutes, Article 179e.

§311.1.Occupational Licenses.

(a)

License Required.

(1)

A person other than a patron may not participate in racing at which pari-mutuel wagering is conducted unless the person has a valid license issued by the Commission.

(2)

A licensee may not employ a person to work at a racetrack at which pari-mutuel wagering is conducted unless the person has a valid license issued by the Commission.

(b)

Duration of License.

(1)

Except as provided in subsection (b)(2) of this section, an occupational or training facility license is valid for one year and expires on the last day of the month in which the license was issued.

(2)

An applicant for the following occupational license types may choose to have the license valid for a period of one, two or three years; kennel owner, kennel owner/owner, kennel owner/owner/trainer, kennel owner/trainer, owner, owner/trainer, trainer, veterinarian, jockey, or multiple owner/stable/farm registration license.

(c)

License Conditions.

(1)

Except as otherwise provided by this section, a license issued by the Commission is a privilege, not a right, and is conditioned on the licensee's compliance with the Act and the Rules.

(2)

If the Act or a rule is amended, the continued holding of a license is conditioned on the licensee's compliance with the Act or rule as amended.

(d)

Effect of Acceptance. By accepting a license issued by the Commission, a person consents to:

(1)

a search by the Commission of the person and the person's possessions at a racetrack to check for violations of the Act or the Rules;

(2)

seizure of contraband; and

(3)

testing for alcohol and controlled substances in accordance with Subchapter D of this chapter.

§311.2.Application Procedure.

(a)

General Requirements. To request a license from the Commission, a person must apply to the Commission on forms prescribed by the executive secretary.

(b)

Application Site.

(1)

Except as provided in subsection (b)(2) of this section, an applicant for an occupational license must file the appropriate application form and related documents at the licensing office at a licensed racetrack.

(2)

An applicant for the following occupational license types may file the appropriate application form and related documents by mail to the main office of the Commission in Austin; kennel owner, kennel owner/owner, kennel owner/owner/trainer, kennel owner/trainer, owner, owner/trainer, trainer, multiple owner/stable/farm registration, training facility employee, and training facility general manager/CEO.

(c)

Examinations. The Commission may require the applicant for an occupational license to demonstrate the applicant's knowledge, qualifications, and proficiency for the license applied for by an examination prescribed by the Commission.

(d)

Issuance of License.

(1)

The stewards or racing judges may review any application for an occupational license and deny a license if the stewards or racing judges determine, after considering the nature of the licenses sought or held by the applicant, issuing a license to the applicant would create a conflict of interest that might affect the integrity of pari-mutuel racing.

(2)

An occupational licensee may not act in any capacity other than that for which he or she is licensed.

(e)

License Badge.

(1)

The Commission shall issue a certificate identification card in the form of a license badge to each individual licensed under this subchapter.

(2)

The badge must bear the seal of the Commission.

(3)

The badge must contain:

(A)

the licensee's full name;

(B)

the licensee's photograph;

(C)

the category of license;

(D)

the month and year in which the license expires;

(E)

a color code that designates whether the licensee has access to the stable or kennel area; and

(F)

the license number assigned by the Commission.

(4)

If a badge issued under this section is lost or stolen, the licensee shall immediately notify the Commission and may apply for a duplicate badge with the same terms as the original badge. To apply for a duplicate badge, the licensee must:

(A)

file a sworn affidavit stating that the badge was lost, stolen, or destroyed;

(B)

surrender any remaining portion of the badge; and

(C)

pay a duplicate badge fee in an amount set by the Commission.

§311.3.Information for Background Investigation.

(a)

Fingerprint Requirements and Procedure.

(1)

Except as otherwise provided by this section, an applicant for a license must submit with the application documents a set of the applicant's fingerprints on a form prescribed by the Department of Public Safety and a set of the applicant's fingerprints for classification by the Federal Bureau of Investigation. If the applicant is not an individual, the applicant must submit a set of fingerprints on the above-referenced forms for each individual who:

(A)

serves as a director, officer, or partner of the applicant;

(B)

holds a beneficial ownership interest in the applicant of 5.0% or more; or

(C)

owns any interest in the applicant, if requested by the Department of Public Safety.

(2)

The fingerprints must be taken by a peace officer or a person authorized by the Commission.

(3)

Not later than the first business day after the day the Commission receives the sets of fingerprints under this section, the Commission shall forward the fingerprints to the Department of Public Safety.

(4)

A person who desires to renew an occupational license must have submitted a set of fingerprints pursuant to this section within the five years prior to renewal or provide a new set of fingerprints for classification by the Federal Bureau of Investigation.

(5)

Waiver.

(A)

Pursuant to Texas Civil Statutes, Art. 179e, §7.10, the Commission will waive the fingerprint requirements in this section for an applicant for an owner or trainer license if:

(i)

the individual presents proof of a valid owner or trainer license issued in a racing jurisdiction that requires the submission of fingerprints to the Federal Bureau of Investigation and the Commission verifies that fingerprints were submitted by that jurisdiction for the applicant within the five years preceding the date of the application in Texas; and

(ii)

the applicant's permanent residence is outside the State of Texas.

(B)

This subsection does not apply to an applicant who:

(i)

has a criminal history in another state, as revealed by a report by the Federal Bureau of Investigation or other reliable criminal information sources;

(ii)

maintains a residence or is employed, whether self- employed or otherwise, in Texas; or

(iii)

obtains a license badge issued by the Commission which gives the applicant access to a restricted area on association grounds.

(C)

Notwithstanding a waiver of the fingerprint requirements under this subsection, the Commission reserves the right, at its sole discretion, to require the submission of fingerprints after a license has been issued.

(b)

Criminal History Record.

(1)

For each individual who submits fingerprints under subsection (a) of this section, the Commission shall obtain a criminal history record maintained by the Texas Department of Public Safety and the Federal Bureau of Investigation.

(2)

The Commission may obtain criminal history record information from any law enforcement agency.

(3)

Except as otherwise provided by this subsection, the criminal history record information received under this section from any law enforcement agency that requires the information to be kept confidential as a condition of release of the information is for the exclusive use of the Commission and its agents and is privileged and confidential. The information may not be released or otherwise disclosed to any person or agency except in a criminal proceeding, in a hearing conducted by the Commission, on court order, or with the consent of the applicant. Information that is in a form available to the public is not privileged or confidential under this subsection and is subject to public disclosure.

§311.4.Occupational License Restrictions

(a)

Non-Transferable.

(1)

Except as otherwise provided by this section, a license issued by the Commission is personal to the licensee and is not transferable.

(2)

If the death of a licensee creates an undue hardship or results in a technical violation of the Act or a Rule, on application of a person who wishes to operate or work under the license, the Commission may issue a temporary license to the person for a period specified by the Commission not to exceed one year.

(b)

Education. To be eligible to receive a license to participate in racing with pari-mutuel wagering, an individual who is under 18 years of age must present to the Commission proof that the individual:

(1)

has graduated from high school or received an equivalent degree; or

(2)

is currently enrolled in high school or equivalent classes.

§311.5. License Fees.

(a)

An applicant for a license must submit with the application documents the license fee in the amount set by the Commission in subsection (c) of this section.

(b)

A license fee must be in the form of a money order, a certified check, a cashier's check, or a personal check. The executive secretary may approve payment in cash at a racetrack if the association submits a plan that is approved by the executive secretary. The plan shall provide for the safety and security of the licensing office where the cash will be received and stored and licensing employees who will be responsible for handling and depositing the cash received.

(c)

The fee for an occupational license is as follows:

Figure: 16 TAC §311.5(c)

§311.6.Denial, Suspension and Revocation of Licenses

(a)

Applicability.

(1)

After notice and hearing in accordance with Subchapter B, Chapter 307 of this title (relating to Adjudicative Procedures), the Commission, stewards, or racing judges may deny, suspend, or revoke a license issued by the Commission.

(2)

If the licensee is not an individual, the grounds for denial, suspension, or revocation of a license apply if a director, officer, or partner of the licensee or an individual who owns an interest in the licensee of 5.0% or more engages in the conduct for which a license may be denied, suspended, or revoked.

(3)

Unless specifically ordered otherwise, if the Commission, stewards, or racing judges suspend one occupational license held by an individual, all occupational licenses held by that individual are considered suspended for the term of the suspension.

(b)

Grounds for Denial, Suspension, and Revocation of Licenses

(1)

Violations or Convictions. A license may be denied, suspended or revoked if it is determined that the licensee has:

(A)

violated or caused to be violated the Act or a Rule;

(B)

been convicted in a court of competent jurisdiction of violating the Act or a Rule;

(C)

been convicted of a felony;

(D)

been convicted of a crime of moral turpitude that is reasonably related to the licensee's fitness to hold a license in accordance with §303.202 of this title (relating to Guidelines);

(E)

aided, abetted, or conspired with another person to violate the Act or a Rule; or

(F)

the licensee had a license issued by another pari-mutuel racing jurisdiction revoked or is currently under suspension in another pari-mutuel racing jurisdiction after notice and an opportunity to be heard.

(2)

Failure to Disclose. A license may be denied, suspended or revoked if it is determined that the licensee:

(A)

failed to provide information required in the license application;

(B)

provided false information in the license application;

(C)

failed to disclose an ownership interest in a horse or greyhound as required by the Rules; or

(D)

failed to fully disclose the true owners of all interests, beneficial or otherwise, in a proposed racetrack facility.

(3)

Domicile. A license may be denied, suspended, or revoked if it is determined that the licensee is domiciled with an individual for whom a license issued by the Commission was denied, suspended, or revoked during the preceding 12-month period.

(4)

Ejection. A license may be denied, suspended, or revoked if it is determined that the licensee has engaged in conduct for which the licensee may be ejected or excluded from a racetrack under the Rules.

(5)

Detrimental Practices. A license may be denied, suspended, or revoked if it is determined that the licensee is engaged in activities or practices that are detrimental to the best interests of the public or to the racing industry.

§311.7.Renewal of Licenses.

(a)

Application. To renew an occupational license issued under this chapter, a licensee must:

(1)

apply to the Commission on a form prescribed by the executive secretary; and

(2)

pay the appropriate annual license fee.

(b)

Terms of License. A license renewed under this subchapter has the same terms and is subject to the same conditions as the original license.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904692

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Other Licenses

16 TAC §311.51

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §5.01, which authorizes the commission to prescribe reasonable license fees for each category of license; §5.03, which authorizes the commission to obtain fingerprints from license applicants; §5.04, which describes the requirements relating to the release of criminal history information; §6.03, which authorizes the commission to prescribe forms for racetrack applications and to establish an application fee; and §6.031, which describes the requirements for a background check for racetrack license applicants.

The proposal implements Texas Civil Statutes, Article 179e.

§311.51.Interim License to Conduct Race Meetings.

(a)

Qualifications. The Commission shall issue to a qualified person an interim license to conduct pari-mutuel race meetings at a racetrack for which a racetrack license has been previously issued. For purposes of this section, a "qualified person" is a person who:

(1)

was the holder of a lien or other debt instrument which secured the original financing of the premises and facilities (or any refinancing thereof); and

(2)

is otherwise eligible pursuant to the Act and the rules to hold a racetrack license.

(b)

Eligibility. To be eligible to receive an interim license under this section, a person must:

(1)

own or hold a leasehold interest in the racetrack premises and facilities pursuant to:

(A)

the foreclosure of the lien securing the original financing of the premises and facilities (or any refinancing thereof);

(B)

the enforcement of an agreement securing the original financing (or any refinancing thereof) of the premises and facilities, provided the agreement was approved by the Commission at the time the agreement was executed; or

(C)

other transfer in lieu of foreclosure or enforcement of the person's rights as a lien holder;

(2)

not previously have held a racetrack license for the racetrack;

(3)

complete an application form prescribed by the executive secretary; and

(4)

pay the base portion of the license fee prescribed in subsection (c) of this section.

(c)

Fees.

(1)

Application fee. The application fee is the amount needed by the Commission to cover the costs incurred by the Department of Public Safety and Commission staff for conducting the background investigation on the applicant. The Department of Public Safety shall calculate the costs it incurred in conducting the background investigation and notify the Commission. The applicant shall pay the application fee not later than 10 business days after receiving a bill for the fee from the Commission.

(2)

License fee. The holder of an interim license shall pay the same fees as other racetracks under §309.8 of this title (relating to Racetrack License Fees).

(d)

Privileges. An interim license issued under this section is valid only for the racetrack premises and facilities specified in the interim license application. An interim license issued under this section carries all the privileges and responsibilities of the class of racetrack license that had been previously issued for the racetrack premises and facilities when the person applying for the interim license was a debt holder.

(e)

Duration. An interim license issued under this section is valid for three years or until a new racetrack license for the racetrack premises and facilities which is of the same class as the original license is issued, whichever occurs first. An interim license issued under this section may be renewed once only and the term of the renewed interim license is three years.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904693

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter B. Specific Licenses

16 TAC §§311.101-311.110

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; and §7.02, which authorizes the commission to adopt categories of occupational licenses and to establish the criteria for those licenses.

The proposal implements Texas Civil Statutes, Article 179e.

§311.101. Horse Owners.

(a)

General Provisions

(1)

Except as otherwise provided by this subsection, the owner of a horse, as listed on the animal's registration paper, must obtain an owner's license before the horse may be entered in a race. A horse may be entered in a stakes race without the owner first obtaining a license, but the owner must obtain a license before the horse may start in the stakes race. A person may not be licensed as an owner if the person is not the owner of record of a properly registered horse that the person intends to race in Texas.

(2)

If the owner is not an individual, each individual who is a director, officer, or partner of the owner or who has an ownership interest in the horse of 5.0% or more must be licensed by the Commission.

(3)

If the owner is not an individual, the owner must provide to the Commission:

(A)

a sworn statement by the chief executive officer of the owner or by one of the partners of the owner that the officer or partner represents the owner and is responsible for the horse;

(B)

a statement that the owner is authorized by law to do business in Texas; and

(C)

a list of the names and addresses of all individuals having an ownership interest in the horse.

(4)

If the owner is not an individual, the ownership entity must:

(A)

designate a representative; or

(B)

file an authorized agent form with the Commission and pay the prescribed fee.

(5)

If the registered owner of a horse is a minor, a financial responsibility form approved by the executive secretary must be signed by the parent or guardian of the owner assuming financial responsibility for the debts incurred for the training and racing of the horse.

(b)

Stable Names.

(1)

An owner that wants to participate in racing using a stable name must register with the Commission by filing an application on a form prescribed by the executive secretary and paying the prescribed annual fee. A person may not use the real name of an owner of a race animal as a stable name. A stable name which has already been registered with the Commission may not be registered by another owner.

(2)

Registering a stable name with the Commission does not affect a person's obligation to file or register a fictitious name as provided by the laws of Texas.

(3)

An application to register a stable name must disclose the real names of all interests participating in the stable and the percentage of ownership interest of each, including the interest owned by a corporation, general partnership, limited partnership, trust, estate or individual.

(4)

A stable name may be changed by registering a new stable name. A stable name may be abandoned by giving written notice to the Commission. A change of 5.0% or more in ownership of a stable registered under a stable name shall be immediately reported to the Commission.

(5)

A licensee who has registered a stable name under this section may not use the licensee's real name for racing purposes except on approval of the stewards.

(c)

Change of Ownership.

(1)

If the owner of an interest in a horse housed on an association's grounds transfers that interest to another person, both parties to the transaction shall give written notice of the transfer to the stewards officiating for that association. Notice under this section must be submitted to the appropriate officials not later than 24 hours after the agreement to transfer the interest is made.

(2)

A licensee of the Commission may not transfer an ownership interest in a horse to avoid disqualification of the horse.

(d)

Change of Trainer. An owner may change the trainer of his or her horse registered at a licensed race meeting provided:

(1)

the request to change trainers is submitted for approval to the stewards on a form provided by the association and approved by the executive secretary;

(2)

the trainer from whom the horse is being transferred signs the form releasing custody of the horse;

(3)

the trainer to whom the horse is being transferred signs the form accepting responsibility for the horses; and

(4)

the stewards approve the transfer.

(e)

Owner/Trainer. A person licensed as an owner/trainer who is training horses at a racetrack may not have any horse owned by the owner/trainer under the care, custody or control of another trainer at that racetrack.

(f)

Restrictions on Racing. An owner may not enter a horse or cause a horse to be entered in a race at a racetrack if:

(1)

the owner or trainer is employed by the racetrack association in a management or supervisory position that is capable of affecting the conduct of races or pari-mutuel wagering at the racetrack; or

(2)

the owner or trainer is involved in any way with the sale or publication of tip sheets on racing grounds.

(g)

Emergency License.

(1)

If an owner is unable to complete an application for an owner's license because of absence or illness, the licensed trainer desiring to enter a horse in a race may apply for an emergency owner's license on behalf of the absent owner.

(2)

The trainer applying for an emergency owner's license on behalf of an absent owner must submit a written statement with the license application specifying the reasons the owner is unable to complete the application.

(3)

The trainer applying for an emergency owner's license must submit at least the following information: the owner's full name, home or business address, telephone number, and social security number. At the time of application, the appropriate licensing fee must be paid to the Commission. Failure to provide all of the foregoing information is grounds for denial of an emergency owner's license.

(4)

An application for an owner's license submitted to the Commission's main office in Austin that is incomplete will be presumed to be a request for an emergency license and an emergency license may be granted.

(5)

A license issued under this section expires on the 21st day after the date the emergency owner's license is issued. An owner may obtain only one emergency license per year.

(6)

An owner granted an emergency license is prohibited from withdrawing any funds from his/her horseman's bookkeeper account until the owner complies with all licensing procedures provided by subsection (a) of this section.

§311.102. Greyhound Owners.

(a)

General Provisions

(1)

Except as otherwise provided by this subsection, the owner of a greyhound, as listed on the animal's registration paper, must obtain an owner's license before the greyhound may be entered in a race. A greyhound may be entered in a stakes race without the owner first obtaining a license, but the owner must obtain a license before the greyhound may start in the stakes race. A person may not be licensed as an owner if the person is not the owner of record of a properly registered greyhound that the person intends to race in Texas.

(2)

If the owner is not an individual, each individual who is a director, officer, or partner of the owner or who has an ownership interest in the greyhound of 5.0% or more must be licensed by the Commission.

(3)

If the owner is not an individual, the owner must provide to the Commission:

(A)

a sworn statement by the chief executive officer of the owner or by one of the partners of the owner that the officer or partner represents the owner and is responsible for the greyhound;

(B)

a statement that the owner is authorized by law to do business in Texas; and

(C)

a list of the names and addresses of all individuals having an ownership interest in the greyhound.

(4)

If the owner is not an individual, the ownership entity must:

(A)

designate a representative; or

(B)

file an authorized agent form with the Commission and pay the prescribed fee.

(5)

If the registered owner of a greyhound is a minor, a financial responsibility form approved by the executive secretary must be signed by the parent or guardian of the owner assuming financial responsibility for the debts incurred for the training and racing of the greyhound.

(b)

Change of Ownership.

(1)

If the owner of an interest in a greyhound housed on an association's grounds transfers that interest to another person, both parties to the transaction shall give written notice of the transfer to the racing judges officiating for that association. Notice under this section must be submitted to the appropriate officials not later than 24 hours after the agreement to transfer the interest is made.

(2)

A licensee of the Commission may not transfer an ownership interest in a greyhound to avoid disqualification of the greyhound.

(c)

Emergency License.

(1)

If an owner is unable to complete an application for an owner's license because of absence or illness, the licensed trainer desiring to enter a greyhound in a race may apply for an emergency owner's license on behalf of the absent owner.

(2)

The trainer applying for an emergency owner's license on behalf of an absent owner must submit a written statement with the license application specifying the reasons the owner is unable to complete the application.

(3)

The trainer applying for an emergency owner's license must submit at least the following information: the owner's full name, home or business address, telephone number, and social security number. At the time of application, the appropriate licensing fee must be paid to the Commission. Failure to provide all of the foregoing information is grounds for denial of an emergency owner's license.

(4)

An application for an owner's license submitted to the Commission's main office in Austin that is incomplete will be presumed to be a request for an emergency license and an emergency license may be granted.

(5)

A license issued under this section expires on the 21st day after the date the emergency owner's license is issued. An owner may obtain only one emergency license per year.

(d)

Restrictions on Racing. An owner may not enter a greyhound or cause a greyhound to be entered in a race at a racetrack if:

(1)

the owner or trainer is employed by the racetrack association in a management or supervisory position that is capable of affecting the conduct of races or pari-mutuel wagering at the racetrack; or

(2)

the owner or trainer is involved in any way with the sale or publication of tip sheets on racing grounds.

§311.103. Kennel Owners.

(a)

Designation of Representative. If a kennel owner is not the trainer of the greyhounds in the kennel, the kennel owner must:

(1)

designate a trainer to be responsible for greyhounds; and

(2)

shall notify the racing judges of the designation.

(b)

Kennel Employees.

(1)

A kennel owner shall identify to the Commission licensing office all individuals employed by the kennel to work on association grounds. No later than 24 hours after a change in personnel occurs, the kennel owner shall notify the Commission licensing office of the change.

(2)

An individual who is licensed to work for a kennel owner is not permitted in the kennel area on association grounds unless the licensee is employed by and doing work for a kennel owner on the association grounds. An individual in the kennel area who is not in the employ of and doing work for a kennel owner may be ejected from the kennel area.

(c)

Owner Suspended. A kennel owner may not retain a greyhound in the kennel owner's care and custody if the Commission has suspended or revoked the license of the owner of the greyhound.

(d)

Use of Texas-Bred Greyhounds.

(1)

Except as otherwise provided by this section, a kennel owner shall ensure that at least 30% of the greyhounds on the active list of the kennel are accredited Texas-bred greyhounds.

(2)

During the first two years in which a kennel is under contract with an association, the kennel owner shall ensure that the following percentage of the greyhounds on the active list are accredited Texas-bred greyhounds:

(A)

for the first year, 5.0%; and

(B)

for the second year, 15%.

(3)

The racing secretary of an association shall maintain the records necessary to enforce this section. If the racing secretary determines that a kennel owner is in violation of this section, the racing secretary shall notify the racing judges. The racing judges may take disciplinary action against the kennel owner, including requiring the kennel owner to take the necessary action to achieve the appropriate percentages.

(e)

Restrictions on Placement in Kennels. A person who owns an interest in a kennel booked at one Texas racetrack may not:

(1)

own an interest in another kennel booked at that racetrack; or

(2)

own an interest in a greyhound that is racing out of another kennel booked at that racetrack.

§311.104. Trainers.

(a)

Licensing.

(1)

Except as otherwise provided by this subsection, a trainer must obtain a trainer's license before the trainer may enter a horse or greyhound in a race. A trainer may enter a horse or greyhound in a stakes race without first obtaining a license, but must obtain a license before the horse or greyhound may start in the stakes race. Except as otherwise provided by this section, to be licensed by the Commission as a trainer, a person must:

(A)

be at least 18 years old;

(B)

satisfactorily complete a written examination prescribed by the Commission; and

(C)

satisfactorily complete a practical examination prescribed by the Commission and administered by the stewards or racing judges or designee of the stewards or racing judges.

(2)

The standard for passing the written examination must be printed on the examination. An applicant who fails the examination may not take the examination again before the 60th day after the date the applicant failed the examination. The Commission may waive the requirement of a written examination for a person who has a current license issued by another pari-mutuel racing jurisdiction. If a person for whom the examination requirement was waived demonstrates an inability to adequately perform the duties of a trainer, through excessive injuries, rulings, or other behavior, the stewards or racing judges may require the person to take the written examination. If such a person fails the examination, the stewards or racing judges shall suspend the person's license for 60 days.

(3)

A trainer must use the trainer's legal name to be licensed as a trainer. A trainer who is also an owner may use a stable name or kennel name in the capacity of owner.

(4)

To be licensed as an assistant trainer, a person must qualify in all respects for a trainer's license and be in the employ of a licensed trainer. An assistant trainer's license carries all the privileges and responsibilities of a trainer's license.

(b)

Absolute Insurer.

(1)

A trainer shall ensure the health and safety of each horse or greyhound that is in the care and custody of the trainer.

(2)

A trainer shall ensure that a horse or greyhound that runs a race while in the care and custody of the trainer or kennel owner is free from all prohibited drugs, chemicals, or other substances.

(3)

A trainer who allows a horse or greyhound to be brought to the paddock or lockout kennel warrants that the horse or greyhound:

(A)

is qualified for the race;

(B)

is ready to run;

(C)

is in a physical condition to exert its best efforts; and

(D)

is entered with the intent to win.

(c)

Health Reports

(1)

A trainer shall immediately notify the Commission veterinarian or designee of unusual symptoms in a horse or greyhound that is in the trainer's care and custody.

(2)

Not later than one hour after finding a dead horse or greyhound on association grounds, a trainer shall notify the stewards or racing judges and the Commission veterinarian, or their designee, of the death.

(d)

Owner Suspended. A trainer may not retain a horse or greyhound in the trainer's care and custody if the Commission has suspended or revoked the license of the owner of the horse or greyhound.

(e)

An individual who is licensed to work for a trainer is not permitted in the stable or kennel area on association grounds unless the licensee is employed by and doing work for a trainer on the association grounds. An individual in the stable or kennel area on association grounds who is not in the employ of and doing work for a trainer may be ejected from the stable or kennel area on the association grounds.

(f)

Restrictions on Racing. A trainer may not enter a race animal or cause a race animal to be entered in a race at a racetrack if:

(1)

the owner or trainer is employed by the racetrack association in a management or supervisory position that is capable of affecting the conduct of races or pari-mutuel wagering at the racetrack; or

(2)

the owner or trainer is involved in any way with the sale or publication of tip sheets on racing grounds.

(g)

Trainer Employees.

(1)

A trainer may not employ an individual who is less than 16 years of age to work for the trainer on an association's grounds.

(2)

A trainer may not employ a jockey to prevent the jockey from riding in a race.

(h)

Trainer Absent. If a trainer must be absent because of illness or any other cause, the trainer shall appoint another licensed trainer to fulfill his or her duties, and promptly report the appointment to the stewards or racing judges for approval. The absent trainer and substitute trainer have joint responsibility for the condition of the race animals normally trained by the absent trainer.

(i)

Suspended, Revoked or Ineligible Horse Trainers.

(1)

A person may not assume the responsibilities of a horse trainer who is ineligible to be issued a license or whose license is suspended or revoked if the person is related to the trainer within the first degree of consanguinity or affinity.

(2)

A person who assumes the care, custody, or control of the horses of a suspended, revoked or ineligible horse trainer may not:

(A)

receive any compensation regarding those horses from the suspended, revoked or ineligible trainer;

(B)

pay any compensation regarding those horses to the suspended, revoked or ineligible trainer;

(C)

solicit or accept a loan of anything of value from the suspended, revoked or ineligible trainer; or

(D)

use the farm or individual name of the suspended, revoked or ineligible trainer when billing customers.

(3)

A person who assumes the care, custody, or control of the horses of a suspended, revoked or ineligible trainer is directly responsible for all financial matters relating to the care, custody, or control of the horses.

(4)

On request by the Commission, a suspended, revoked or ineligible trainer or a person who assumes the care, custody, or control of the horses of a suspended, revoked or ineligible trainer shall permit the Commission to examine all financial or business records to ensure compliance with this section.

(j)

Reporting to Clocker. When taking a horse onto a racetrack to work, a horse trainer or an assistant of the trainer shall report the horse's name and the distance to be worked to the morning clocker or an assistant clocker or shall instruct the jockey or exercise rider to transmit the information to the clocker or assistant clocker.

§311.105. Jockeys

(a)

License.

(1)

To be licensed as a jockey, an individual must be at least 16 years of age and provide proof of a satisfactory physical examination as described in subsection (b).

(2)

An individual licensed as a jockey or apprentice jockey may not be licensed in another capacity.

(b)

Physical Examination.

(1)

To be eligible to ride in a race, a jockey must have on file with the Commission proof of a satisfactory physical examination conducted during the 12-month period preceding the date of the race.

(2)

An examination required by this section must be performed by a licensed physician and include tests for visual acuity and hearing.

(3)

The Commission or the stewards may require a jockey to be reexamined at any time and may refuse to permit a jockey to ride until proof of a satisfactory examination is submitted.

(c)

Apprentice Jockeys.

(1)

An apprentice jockey is a rider of thoroughbreds who:

(A)

is permitted to ride with the apprentice weight allowance in accordance with Chapter 313 of this title (relating to Officials and Rules of Horse Racing); and

(B)

is otherwise qualified to be licensed as a jockey.

(2)

To be licensed as an apprentice jockey, an individual must submit with the application:

(A)

proof of a satisfactory physical examination as required for a jockey's license; and

(B)

a certificate of proficiency issued by a starter licensed in this state.

(3)

The Rules relating to a jockey apply to apprentice jockeys.

(d)

Jockey Conduct.

(1)

A jockey may not ride under an assumed name.

(2)

A jockey may not use an attendant on a race day other than one supplied by the association.

(3)

A jockey may not smoke in public while wearing racing colors.

§311.106. Veterinarians.

To be eligible to be licensed by the Commission as a veterinarian, an individual must show proof of current licensure in good standing by the Texas State Board of Veterinary Medical Examiners.

§311.107. Lessee/Lessor.

(a)

A race animal may be raced under lease provided a completed lease form is attached to the registration certificate and is on file with the racing secretary. A copy of the lease must be provided to the stewards, racing judges, or their designee at the time of application for an owner's license.

(b)

The lessee and lessor of a horse or greyhound for racing purposes must obtain an owner's license in accordance with §311.101(a) of this title (relating to Horse Owners) and §311.102(a) of this title (relating to Greyhound Owners).

§311.108. Authorized Agent.

(a)

To be appointed an authorized agent, an individual must be at least 18 years old and licensed as either an individual owner or a trainer. A written agency appointment authorizing him or her to act on behalf of a licensed owner or licensed trainer in racing matters not directly related to the care and training of horses must accompany the appointment. The authorization shall be on a form provided by the Commission and shall define the agent's powers and limits. The authorization must be notarized and signed by the principals.

(b)

A separate notarized agency appointment is required for each principal an authorized agent intends to represent.

(c)

An agency appointment expires on the last day of the twelfth month after the date of appointment or when the principal submits written notice of revocation to the stewards or racing judges, whichever occurs first.

§311.109. Mutuel Employees.

To be licensed as a mutuel clerk or other employee of the mutuel department of an association, an individual must be at least 16 years old.

§311.110. Leadout.

(a)

To be licensed as a leadout, an individual must demonstrate to the satisfaction of the Commission veterinarian that the individual is knowledgeable in the handling and/or care of greyhounds.

(b)

A leadout shall be dressed in a clean uniform for each performance, present a neat appearance, and behave in an orderly manner.

(c)

A leadout may not smoke while in uniform.

(d)

A leadout may not own an interest in a greyhound registered at the association for which the leadout is employed.

(e)

Except in the leadout's lounge, a leadout may not consume or carry food or beverages while the leadout is on duty.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904694

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter C. Responsibilities of Individuals

16 TAC §§311.201-311.216

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act ; §3.16, which authorizes the commission to adopt rules prohibiting the illegal influence on the outcome of a race and relating to the drug testing of licensees; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks and §7.06, which requires the commission to issue identification cards to occupational licensees.

The proposal implements Texas Civil Statutes, Article 179e.

§311.201. Applicability.

This chapter applies to:

(1)

all persons licensed by the Commission, either in an occupational capacity or by virtue of the person's ownership in a racetrack licensee; and

(2)

all persons, whether or not licensed by the Commission, whose actions may affect the outcome of a pari-mutuel race, the payout of a pari-mutuel pool, or the health, safety, or welfare of individuals on association grounds.

§311.202. Best Effort.

(a)

A licensee shall make the licensee's best effort to win in each race in which the licensee participates.

(b)

A person may not:

(1)

instruct a licensee to use less than the licensee's best efforts to win a pari-mutuel race; or

(2)

handle a race animal in a manner that would cause the race animal to use less than its best efforts to win a pari-mutuel race.

§311.203. Ineligible Participant.

A licensee may not enter or start a race animal in a race or allow a race animal to be entered or to start in a race if the licensee knows the race animal is ineligible to race under the Act or the Rules.

§311.204. Bribes Prohibited.

(a)

A person may not:

(1)

directly or indirectly offer or give a bribe to another person to violate the Act or a Rule; or

(2)

solicit or accept a bribe from another person to violate the Act or a Rule.

(b)

A licensee may not offer, give, solicit, or accept a bribe to

(1)

not enter a race animal in a race;

(2)

provide false information in order to have a race animal scratched from a race; or

(3)

withdraw a race animal from a race.

(c)

A person may not offer, give, solicit, or accept a bribe to purchase or cash a mutuel ticket for another person.

(d)

A licensee shall notify the Commission immediately if the licensee knows that a person has violated this section.

§311.205. Wagering.

(a)

A person other than an association may not solicit or accept wagers from the public on the outcome of a pari-mutuel horse or greyhound race.

(b)

A jockey scheduled to ride in a race may not wager on a race scheduled for the same day.

(c)

The following licensees are prohibited from wagering in the state of Texas during the term of their license:

(1)

all officials; and

(2)

assistant starters.

(d)

The following licensees are prohibited from wagering in the state of Texas at the association at which he or she is employed:

(1)

valets or leadouts;

(2)

photofinish operators or employees;

(3)

security personnel; and

(4)

any licensee whose duties require the licensee to work in the jockey's quarters, test barn, or test area.

§311.206. Influence of Race Prohibited.

(a)

A person may not improperly influence or conspire or attempt to improperly influence the results of a race.

(b)

A person may not possess on association grounds or use a device designed to increase or decrease the speed of a horse other than an ordinary riding whip.

§311.207. Inhumane Treatment.

A person on association grounds may not subject a race animal to cruel or inhumane treatment or, through act or neglect, subject a race animal to unnecessary suffering.

§311.208. Performance Information.

A person may not give false or misleading information about the performance of a race animal for publication in a printed program or racing publication or for purposes of establishing eligibility or fitness to race.

§311.209. Information to Commission.

(a)

A person may not knowingly make a false statement, whether oral or written, to the Commission, the executive secretary, the stewards or racing judges, Commission investigator, an administrative law judge or an examiner appointed by the Commission in any formal or informal interview or proceeding involving the Commission.

(b)

A licensee shall promptly notify the Commission regarding any changes to the licensee's mailing address and telephone number.

(c)

A licensee shall promptly notify the Commission if the licensee knows that a person has violated a criminal provision of the Act.

§311.210. Conduct.

(a)

A person shall behave in an orderly manner while on association grounds.

(b)

A person may not use offensive, obscene, or threatening language or gestures while on association grounds.

(c)

A person shall use reasonable diligence and precaution to prevent fires in the stable or kennel area. A person may not smoke in a stall, near a greyhound crate, in a feed room or hay storage area, or under a shed row. A person may not leave an unattended electrical appliance plugged into an outlet in the stable or kennel area. A person may not leave an electrical outlet or electrical cord within the reach of a race animal. A person may not lock a stall that is occupied by a horse. A person may not possess, keep, or maintain, in the stable or kennel area:

(1)

an open fire or an oil or gas lamp; or

(2)

a flammable material, such as cleaning fluid or solvent.

(d)

A person may not enter, attempt to enter, or assist or attempt to assist another person in entering the stable or kennel area except through the designated entrances and on showing a valid license badge or visitor's pass.

(e)

A person may not interfere with, attempt to interfere with, or conspire with another to interfere with any decision- making process of the stewards or racing judges including, but not limited to, formal and informal disciplinary hearings.

§311.211. Weapons Prohibited.

(a)

Except as otherwise provided by this section, a person may not possess on association grounds a weapon listed under Penal Code, §46.03(a).

(b)

This section does not apply to a person who is:

(1)

a peace officer; or

(2)

a commissioned security officer licensed by the Texas Board of Private Investigators and Private Security Agencies and approved by the executive secretary.

§311.212. Duty to Wear Badge.

(a)

Except as otherwise provided by this section, a licensee shall display his or her license badge in a conspicuous place on his or her body at all times that the licensee is on association grounds.

(b)

This section does not apply to a licensee who is:

(1)

not engaged in performing the licensee's duties and is in the grandstand area of the association grounds; or

(2)

mounted on a horse.

§311.213. Accident Reports.

(a)

A licensee who observes or is involved in an accident that occurs on association grounds during a race meeting and that results in an injury to a person or race animal shall report the accident to the association.

(b)

A report under this section must be made not later than 24 hours after the time the accident occurred.

§311.214. Financial Responsibility.

(a)

This section applies to the financial responsibility of licensees of the Commission for debts legally owed for the transfer, purchase or lease of a race animal or services or supplies relating to the care, transportation, or maintenance of a race animal participating at a licensed race meeting in this state. Services and supplies to which this section applies include, but are not limited to:

(1)

veterinary services, medication, and veterinary supplies;

(2)

transportation services;

(3)

farrier services and supplies;

(4)

feed and nutritional supplements; and

(5)

racing supplies.

(b)

The Commission finds that the failure of a licensee of the Commission to pay a debt that is legally owed for the transfer, purchase or lease of a race animal or a service or supply described in subsection (a) of this section is:

(1)

an activity or practice that is detrimental to the best interests of the public and the sport of pari-mutuel racing; and

(2)

grounds for denial, suspension, or revocation of the licensee's license.

(c)

For a debt that is legally owed for the transfer, purchase or lease of a race animal or a service or supply described in subsection (a) of this section, a licensee may not:

(1)

willfully or intentionally refuse to pay the debt; or

(2)

falsely deny the validity of the debt with the intent to defraud the person to whom the debt is owed.

(d)

A person to whom a debt for the transfer, purchase or lease of a race animal or a service or supply described in subsection (a) of this section is owed may file with the executive secretary a certified copy of a judgment of a court of competent jurisdiction that verifies the validity of the debt. On receipt of a judgment under this subsection, the executive secretary may initiate formal disciplinary action against the licensee involved. The executive secretary has sole discretion to determine whether formal disciplinary action is initiated against the licensee.

(e)

At a hearing to deny, suspend, or revoke a licensee's license for a violation of this section, the person to whom the debt is owed is not entitled to reimbursement of travel expenses or any witness fees for attendance at the hearing.

§311.215. Contraband.

(a)

The following items are contraband on a racetrack or association grounds:

(1)

a criminal instrument related to racing under the Act;

(2)

an electrical shocking device, spur, or similar device or paraphernalia designed to increase or decrease the speed of a race animal or to unnaturally depress, stimulate, or excite a race animal;

(3)

a device prohibited under §319.10 of this title (relating to Devices and Substances Prohibited), including a hypodermic syringe or hypodermic needle;

(4)

a deadly weapon prohibited under §311.211 of this title (relating to Weapons Prohibited); and

(5)

a drug, chemical, or other substance prohibited under:

(A)

§319.3 of this title (relating to Medication Restricted);

(B)

§319.7 of this title (relating to Labeling Requirements);

(C)

§319.10 of this title (relating to Devices and Substances Prohibited); or

(D)

§319.14 of this title (relating to Possession of Controlled Substances).

(b)

No person may possess an item of contraband at any time while on a racetrack or association grounds. It is an affirmative defense to a rule violation under this subsection that:

(1)

Commission rules expressly state the item was not contraband; or

(2)

the possession was expressly authorized on a racetrack or association grounds by the Act or the Rules.

§311.216. Conduct in Stable Area.

(a)

An individual may not sleep in the stable area of an association's grounds except:

(1)

in a facility provided for that purpose by the association in accordance with the Rules;

(2)

in a barn that was constructed after 1990 of fire retardant materials; or

(3)

in a tack room that was constructed after 1990 of fire retardant materials, provided the tack room has a window that opens.

(b)

A licensee may not possess, keep, or maintain a dog in the stable area of an association's grounds unless:

(1)

the dog is confined and prevented from going at large on association grounds; and

(2)

the dog is annually vaccinated against rabies.

(c)

A licensee who is galloping or ponying a horse or riding a horse in a race shall wear a properly fastened helmet, of a type approved by the executive secretary, at all times.

(d)

A licensee may not hold a horse in a starting gate unless the licensee wears properly fastened headgear, of a type approved by the executive secretary.

(e)

Except as otherwise provided by this subsection, a licensee may not operate a motor vehicle in the stable area during training hours. This subsection does not apply to:

(1)

a person who has power of entry under the Act, §3.03,

(2)

the stewards;

(3)

security personnel employed by the association;

(4)

the Commission veterinarian;

(5)

the racing secretary;

(6)

a veterinarian licensed by the Commission;

(7)

an owner or a trainer;

(8)

a jockey's agent at a Class 1 racetrack;

(9)

a farrier; or

(10)

a jockey.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904695

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter D. Alcohol and Drug Testing

1. Drugs

16 TAC §§311.301-311.308

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §3.16, which authorizes the commission to adopt rules prohibiting the illegal influence on the outcome of a race and relating to the drug testing of licensees; and §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§311.301.Use Prohibited.

(a)

Except as otherwise provided by this section, an occupational licensee may not, while performing duties required of the licensee, have present in his or her system a dangerous drug as defined by the Health and Safety Code, Chapter 483, or a controlled substance as defined by the Texas Controlled Substances Act, Health and Safety Code, Chapter 481.

(b)

Except as otherwise provided by this section, an occupational licensee may not possess, while on association grounds, a dangerous drug as defined by the Health and Safety Code, Chapter 483, or a controlled substance as defined by the Texas Controlled Substances Act, Health and Safety Code, Chapter 481. This subsection does not apply to a veterinarian licensed by the Commission who has obtained permission to possess a controlled substance or dangerous drug under §319.14 of this title (relating to Possession of Controlled Substances).

(c)

This section does not apply to the possession or use of a prohibited substance obtained with a valid prescription by an occupational licensee under orders of a licensed physician acting in the course of the physician's professional practice.

§311.302.Subject to Testing.

(a)

The stewards or racing judges may require an occupational licensee acting pursuant to the license to submit to a urine test or other non-invasive fluid test at any time while on association grounds.

(b)

A licensee who refuses to submit to such a test when requested to do so by the stewards or racing judges shall be suspended for at least 30 days and referred to the Commission. A licensee who refuses to submit to a test for the second time shall be suspended by the stewards or racing judges for at least six months and referred to the Commission. A licensee who refuses to submit to a test for a third or subsequent time shall be suspended by the stewards or racing judges for one year and referred to the Commission.

§311.303.Method of Selection.

(a)

An occupational licensee may be selected for testing under this subchapter by a method of random selection prescribed by the executive secretary. The method may be changed from time to time, and it is not an indication of unfairness if a licensee is selected more frequently than any other, providing there is no manipulation of the selection process.

(b)

An occupational licensee may be selected for testing at any time while on association grounds on the basis of reasonable belief.

§311.304.Taking of Specimens.

(a)

An occupational licensee selected for urine testing shall, on request, provide the urine specimen without undue delay, in the presence of or under the supervision of a representative of the Commission.

(b)

The specimen shall be immediately sealed and tagged on a form provided by the executive secretary, and the licensee shall sign the form. The portion of the form that accompanies the specimen to the laboratory for analysis may not identify the licensee by name.

(c)

A licensee shall cooperate fully with the Commission and its designees in obtaining a specimen and in witnessing the securing of the specimen.

(d)

The executive secretary shall develop procedures for the splitting of specimens obtained under this section and the storage and testing of the split specimens. The procedures shall address situations when there is an insufficient quantity of specimen for splitting and when the licensee desires to waive a split specimen. The executive secretary shall ensure the procedures are posted prominently at each racetrack licensing office.

§311.305.Security of Specimens.

(a)

The executive secretary shall ensure that specimens obtained for testing under this subchapter are stored and delivered to the testing laboratory in a manner that ensures the integrity of the specimens.

(b)

A person may not tamper with or attempt to tamper with a specimen taken for testing under this subchapter.

§311.306.Medical Review Officer.

(a)

The executive secretary shall select a medical review officer to assist the Commission in the evaluation of licensees tested under this subchapter. A medical review officer must be professionally trained to evaluate substance and alcohol abuse. In the performance of his or her duties under this subchapter, the medical review officer may designate other persons in the same general locations as the various licensed racetracks to evaluate licensees. To be designated by the medical review officer, a person must be professionally trained to evaluate substance and alcohol abuse.

(b)

The laboratory at which a specimen obtained under this subchapter is analyzed shall report all test results in writing to the medical review officer.

(c)

The medical review officer shall review each test result received and determine whether the result constitutes a prima facie violation of the Commission's rules. The medical review officer shall then notify the Commission in writing of each prima facie violation. Not later than five days after receipt of written notice from the medical review officer of a prima facie violation, the tested licensee shall be notified in writing of the alleged violation.

§311.307.Confidentiality of Results.

The results of a test under this subchapter are confidential, except for their use with respect to a ruling issued pursuant to this subchapter or in an administrative or judicial hearing regarding the ruling.

§311.308.Penalties.

(a)

The stewards or racing judges shall impose penalties in accordance with this section for a violation of §311.301 of this title (relating to Use Prohibited). A penalty imposed under this section is appealable in the same manner as other orders of the stewards or racing judges.

(b)

If the stewards or racing judges require a licensee to submit to testing under §311.302 of this title (relating to Subject to Testing) for reasonable belief, the stewards or racing judges may prohibit the licensee from participating in racing for the remainder of that race day, on the recommendation of a physician who has examined the licensee.

(c)

For a first violation, the stewards or racing judges shall:

(1)

suspend the licensee's license for at least 30 days; and

(2)

prohibit the licensee from participating in racing until:

(A)

the licensee's condition has been evaluated by the medical review officer or a person designated by the medical review officer under §311.306 of this title (relating to Medical Review Officer);

(B)

the licensee has satisfactorily complied with any rehabilitation requirements ordered by the medical review officer; and

(C)

the licensee has produced a negative test result.

(d)

For a second violation, the stewards or racing judges shall:

(1)

suspend the licensee's license for at least six months; and

(2)

prohibit the licensee from participating in racing until:

(A)

the licensee has satisfactorily completed a certified substance abuse rehabilitation program approved by the medical review officer; and

(B)

the licensee produces a negative test result.

(e)

For a third or subsequent violation, the stewards or racing judges shall suspend the licensee for one year and refer the licensee to the Commission.

(f)

After a suspended licensee has satisfactorily complied with any rehabilitation requirements ordered by the medical review officer or completed a certified substance abuse rehabilitation program approved by the medical review officer, the licensee may apply to have the license reinstated. The stewards or racing judges may reinstate the license if the stewards or racing judges determine the licensee poses no danger to other licensees or race animals and that reinstatement is in the best interest of racing. On reinstatement, the stewards or racing judges shall require the licensee to submit to further drug testing to verify continued unimpairment and complete any additional rehabilitation or after-care drug treatment recommended by the medical review officer.

(g)

All specimens to be tested under this subchapter shall be obtained and tested by the Commission under conditions properly controlled to guarantee the integrity of the process. The charges for tests conducted under this subchapter shall be forwarded to the Commission for approval as to the reasonableness of the charges in relation to industry standards for comparable testing procedures. The Commission shall pay the cost of the initial test. The licensee being tested is responsible for paying the costs of all tests other than the initial test.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904696

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Earliest possible date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Alcohol

16 TAC §§311.321-321.323

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §3.16, which authorizes the commission to adopt rules prohibiting the illegal influence on the outcome of a race and relating to the drug testing of licensees; and §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks.

The proposal implements Texas Civil Statutes, Article 179e.

§311.321.Prohibited Conduct.

(a)

This section applies to conduct by occupational licensees that occurs on association grounds.

(b)

A licensee may not be under the influence of an alcoholic beverage or have an alcohol concentration of more than 0.0% in his or her body while the licensee is engaged in the performance of the licensee's duties. A licensee may not possess or consume an alcoholic beverage while in the stable or kennel area of the association grounds.

(c)

Notwithstanding subsection (b) of this section, an owner of a horse or greyhound whose involvement is limited to that of a spectator during racing hours may consume alcoholic beverages while in the grandstand area.

(d)

For purposes of this subchapter, "alcohol concentration" means:

(1)

the number of grams of alcohol per 210 liters of breath; or

(2)

the number of grams of alcohol per 67 milliliters of urine.

§311.322.Breathalyzer or Other Test.

(a)

The stewards or racing judges may require a licensee to submit to a breathalyzer test or other non- invasive test at any time while on association grounds. An occupational licensee may be selected for testing by a method of random selection prescribed by the executive secretary. The method may be changed from time to time, and it is not an indication of unfairness if a licensee is selected more frequently than any other, providing there is no manipulation of the selection process. An occupational licensee may be selected for testing at any time while on association grounds on the basis of reasonable belief.

(b)

A licensee who refuses to submit to such a test when requested to do so by the stewards or racing judges is subject to discipline by the stewards or racing judges.

(c)

If the results of a test conducted under this section show a prohibited alcohol concentration, the stewards or racing judges shall impose penalties as authorized by §311.323 of this title (relating to Penalties).

§311.323.Penalties.

(a)

For a first violation under §311.221 of this title (relating to Prohibited Conduct) or §311.322 of this title (relating to Breathalyzer or Other Test), the stewards or racing judges shall prohibit the licensee from participating in racing for the remainder of that race day. In addition, the stewards or race judges may:

(1)

prohibit the licensee from participating in racing until the licensee's condition has been evaluated by the medical review officer or a person designated by the medical review officer under §311.306 of this title (relating to Medical Review Officer); and

(2)

impose a fine in accordance with Chapter 307 of this title (relating to Practice and Procedure).

(b)

If the person evaluating a licensee determines the licensee's condition is non-addictive or not detrimental to the best interest of racing, the stewards or racing judges shall permit the licensee to participate in racing, provided the licensee:

(1)

produces a negative test result; and

(2)

agrees to further testing to verify continued unimpairment.

(c)

If the person evaluating a licensee determines the licensee's condition is addictive or detrimental to the best interest of racing, the stewards or racing judges shall prohibit the licensee from participating in racing until the licensee:

(1)

produces a negative test result;

(2)

provides proof that the licensee has satisfactorily completed a certified alcohol abuse rehabilitation program approved by the medical review officer; and

(3)

agrees to further testing to verify continued unimpairment.

(d)

For a second or subsequent violation, the stewards or racing judges shall suspend the licensee's license. After the licensee has satisfactorily completed a certified alcohol abuse rehabilitation program approved by the medical review officer, the licensee may apply to have the license reinstated. The stewards or racing judges may reinstate the license if the stewards or racing judges determine the licensee poses no danger to other licensees or race animals and that reinstatement is in the best interest of racing.

(e)

All specimens to be tested under this subchapter shall be obtained and tested by the Commission under conditions properly controlled to guarantee the integrity of the process. The charges for tests conducted under this subchapter shall be forwarded to the Commission for approval as to the reasonableness of the charges in relation to industry standards for comparable testing procedures. The Commission shall pay the cost of the initial test. The licensee being tested is responsible for paying the costs of all tests other than the initial test.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904697

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Chapter 321. Pari-Mutuel Wagering

Subchapter A. Totalisator Operations

1. General Provisions

16 TAC §321.8

The Texas Racing Commission proposes new §321.8 relating to totalisator systems. This two new rule section is proposed in conjunction with the agency's review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, §55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (section). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees.

As part of the reorganization of the Commission rules, the agency is complying with the Section 167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

One section in Chapter 305 relates to totalisator systems. It is determined that the reason for this section still exists. Therefore, it is being incorporated into Chapter 321, Subchapter A, which are the general provisions relating to totalisator systems. Former §305.46 will be renumbered §321.8.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rule is in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

The new section is proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks; §7.02, which authorizes the commission to adopt categories of occupational licenses and to establish the criteria for those licenses; §11.01, which authorizes the commission to adopt rules to regulate pari-mutuel wagering; and §11.011, which authorizes the commission to adopt rules to regulate pari-mutuel wagering on simulcast races.

The proposal implements Texas Civil Statutes, Article 179e.

§321.8. Totalisator Systems.

(a)

To be licensed to operate a totalisator system, a person must:

(1)

submit with the application a copy of a written contract to provide a totalisator system to an association;

(2)

provide evidence to the commission that the totalisator system uses state-of-the-art computational equipment and that the person has the expertise necessary to operate a totalisator system; and

(3)

provide an affidavit stating that the person will comply with rules of the commission and the comptroller regarding the use of the totalisator system equipment.

(b)

An application for a totalisator system license must be submitted to the commission at the same time that the proposed contract between the totalisator system operator and the association is submitted to the commission for approval.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904699

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


Subchapter D. Totalisator Operations

1. Mutuel Facilities

16 TAC §§321.301-321.306

The Texas Racing Commission proposes new Subchapter D, Division 1 to Chapter 321, relating to the mutuel facilities of totalisator operations. These new rule sections are proposed in conjunction with the agency's review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, §55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (section). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees.

As part of the reorganization of the Commission rules, the agency is complying with the §167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Subchapter D, Division 1 of Chapter 309 relates to the mutuel facilities of totalisator operations. It is determined that the reason for this division still exists. Therefore, the rules in this division are being incorporated into Chapter 321, which relates to the requirements and regulation of pari-mutuel wagering. A new Subchapter D, Division 1 is being proposed to regulate totalisator operations. Former §309.401 through §309.406 will be renumbered §321.301 through §321.306.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rules are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080.

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §6.06 which authorizes the Commission to adopt rules regarding racetrack license applications; §11.01, which authorizes the commission to adopt rules to regulate pari-mutuel wagering; and §11.011, which authorizes the commission to adopt rules to regulate pari-mutuel wagering on simulcast races.

The proposal implements Texas Civil Statutes, Article 179e.

§321.301. Totalisators.

An association shall use wagering machines, linked to a computer-based totalisator system that:

(1)

records the progressive, aggregate, and final totals in dollars bet in each pool and on each entry or mutuel field;

(2)

computes the approximate and final odds in the win pool for each entry in each race at intervals of not more than 60 seconds and relays those odds to the infield display board and to other display devices:

(3)

computes the final odds in each pool after a race;

(4)

computes the shares for the purses, the state, and the association, and the breakage and components of the breakage; and

(5)

computes the pay-off prices.

§321.302. Locking Devices.

An association shall provide devices to lock wagering machines before the start of each race, including:

(1)

a locking control switch located in or near the racing judges' or stewards' stand in a location approved by the Executive Secretary; and

(2)

a manual emergency locking switch located in or near the tote room for use independently from the switch in the judges' or stewards' stand.

§321.303. Stop Betting Command.

(a)

At the appropriate time before each race, a racing judge or steward shall issue the "stop betting" command to activate the locking control switch and ring the off bell.

(b)

The association employees in the pari-mutuel department are responsible for ensuring that all wagering stops when the "stop betting" command is issued.

(c)

An association may not permit a wager to be accepted or a ticket to be cancelled after the "stop betting" command has been issued.

§321.304. Final Confirmation.

To confirm the final record of pari-mutuel sales for each race, an association shall make a record for each wagering pool on magnetic media. For each wagering machine, the record must state:

(1)

the total number of dollars wagered on each entry; and

(2)

the combination of entries.

§321.305. Security for Totalisator Equipment.

The association shall ensure that the facilities in which the totalisator computers are located are secured by an electronic security system. The security system must:

(1)

be capable of detecting authorized and unauthorized entry using a coded locking system, e.g., card identification;

(2)

notify the pari-mutuel auditor before the next performance of any unauthorized entry; and

(3)

contain procedures approved by the commission for entry to the facilities at times other than during normal operating hours.

§321.306. Access to Tote Room.

(a)

An association may not permit an individual to have access to the tote room or totalisator equipment unless the individual is authorized to have access to the room or equipment in accordance with this section.

(b)

An association may authorize an individual to have access to the tote room and shall maintain a list of all individuals authorized under this subsection.

(c)

A totalisator system licensee shall maintain a list of all employees of the licensee who are authorized to have access to the tote room or the totalisator equipment.

(d)

Not later than the 10th day before the first day of a race meeting, the association and the totalisator system licensee shall deliver a copy of a list maintained under subsection (b) or (c) of this section to the pari-mutuel auditor and to the commission.

(e)

The pari-mutuel auditor may enter the tote room and all other facilities on association grounds that are used in connection with the totalisator system and pari-mutuel operations. The executive secretary may authorize other individuals to enter the tote room and pari-mutuel facilities in accordance with this subsection.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904700

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699


2. Totalisator System Requirements

16 TAC §§321.321-321.337

The Texas Racing Commission proposes new Subchapter D, Division 2, §§321.321-321.337, to Chapter 321, relating to the mutuel facilities of totalisator operations. These new rule sections are proposed in conjunction with the agency's review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, §55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (section). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees.

As part of the reorganization of the Commission rules, the agency is complying with the §167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Subchapter D, Division 2 of Chapter 309 relates to the mutuel facilities of totalisator system requirements. It is determined that the reason for this division still exists. Therefore, the rules in this division are being incorporated into Chapter 321, which relates to the requirements and regulation of pari-mutuel wagering. A new Subchapter D, Division 2 is being proposed to regulate totalisator operations. Former §§309.421-309.437 will be renumbered §§321.321-321.337.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rules are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas, 78711-2080.

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §6.06 which authorizes the Commission to adopt rules regarding racetrack license applications; §11.01, which authorizes the commission to adopt rules to regulate pari-mutuel wagering; and §11.011, which authorizes the commission to adopt rules to regulate pari-mutuel wagering on simulcast races.

The proposal implements Texas Civil Statutes, Article 179e.

§321.321.Redundant Capabilities.

A totalisator system must have redundant capabilities in a master/slave configuration to ensure that under normal operating conditions a totalisator system failure will not interrupt pari-mutuel operations.

§321.322.Record of Stop Betting Command.

A totalisator system must, for each race:

(1)

identify and record on the system log file which locking control switch issued the "stop betting" command;

(2)

record the time of day that the command was issued; and

(3)

confirm to the racing judges or stewards that wagering has stopped.

§321.323.Odds.

(a)

A totalisator system must include at least one odds board. The system must update the odds on the odds board on each betting interest in the win pool at intervals of not more than 60 seconds.

(b)

At intervals of not more than 60 seconds during the wagering period for each race, at the end of each race, and at the end of each race performance, the system must produce a computer report of the total number of dollars wagered on each betting interest in the win, place, and show pools, and other wagering information given to patrons during the wagering period.

§321.324.Odds Board Control.

The controls that operate the order of finish on the odds board must be located in or immediately adjacent to the racing judges' or stewards' stand and be controlled by a racing judge or steward or a designee of a racing judge or steward.

§321.325.Retention of Racing Performance Data.

A totalisator system must store data on racing performances on discs or other storage devices capable of transferring the data to hard copy in a readable form. The data must be stored until all audits by the commission or the comptroller are completed.

§321.326.Magnetic Tapes.

(a)

Except as otherwise provided by this section, a totalisator system must be able to produce nine-track tapes with 1600 or 6250 BPI. The system must be able to verify that the data was copied correctly to the magnetic tape.

(b)

If the system does not produce tapes in the format required by subsection (a) of this section, the totalisator system licensee shall establish a procedure approved by the commission and the comptroller to convert magnetic tapes to this format.

(c)

Each magnetic tape must be labeled separately for each race performance. The external label must include:

(1)

the name of the association licensee;

(2)

the race performance number;

(3)

a sequence number; and

(4)

the date and time the tape was produced.

§321.327.Summary.

A totalisator system must be able to produce and provide to the commission and the comptroller:

(1)

a magnetic tape in a format prescribed by the commission that contains data to recreate the wagering activity during a race performance;

(2)

a report that summarizes the wagering activity for each race performance on a race- by-race basis; and

(3)

a daily list, by unique ticket number, of the cashed and outstanding tickets for each race performance.

§321.328.Unique Ticket Number.

A totalisator system must assign a unique ticket number to each ticket issued. The unique ticket number must be printed on the ticket when it is issued by the ticket-issuing machine and the number must be recorded in the computer system.

§321.329.Outstanding Tickets.

A totalisator system must retain in the computer system the unique ticket number of each outstanding ticket. The system must maintain the unique ticket number in a computer data file protected by a password activated security sub- system. The system must maintain a log of all password entries to the file.

§321.330.Computer-Produced Reports.

A totalisator system must print on each computer-produced report:

(1)

the association's name;

(2)

the performance number;

(3)

the race number, if applicable;

(4)

the version number of the totalisator software used;

(5)

the date and the time the report was created; and

(6)

sequential page numbers beginning with 1.

§321.331.System Log.

A totalisator system must maintain a system log file in which all system- related information, security-related transactions, operational data, descriptions of unusual occurrences, commands, and messages to or from the system operator is stored.

§321.332.Security for Sub-System.

(a)

A totalisator system must be controlled by a security sub-system. The sub-system must be able to validate a sign-on to the totalisator system through a wagering machine or a system console and must use table look-up techniques to determine which functions the user is permitted to perform when the totalisator system is operating.

(b)

The security sub-system must record in a system log file any attempt to:

(1)

stop the execution of the system;

(2)

alter the contents of the memory or auxiliary storage device; or

(3)

modify the sequence of instructions in the computer.

§321.333.Access to Sub-systems.

A totalisator system must limit access to the operating and security sub- systems to no more than three terminals or consoles. The terminals or consoles must be located in the tote room and the system must require the use of a password for access to the sub-systems.

§321.334.Power Fluctuations.

A totalisator system must provide the hardware necessary to minimize the effects of a power fluctuation on the totalisator system. The hardware, insofar as possible, must maintain power to the computers at a constant level within design limits. The totalisator system licensee shall select the hardware for compatibility with its system design.

§321.335.Comparison of Pool Totals.

(a)

A totalisator system must be able to maintain at least two independent sets of pool totals and compare them at least once every 60 seconds.

(b)

The system must record in a system log file any difference in the final pool totals.

(c)

If the totalisator system licensee cannot determine which final pool total is correct, the highest pool total shall be used in all calculations.

§321.336.Loss of Communication Reports.

(a)

A totalisator system must detect lost communication with hardware peripheral devices, including disc drives, printers, consoles, wagering machines, and any other devices that are part of the system configuration.

(b)

The system must enter into the system log file the circumstances surrounding the lost communication and produce a hard copy report on the loss.

§321.337.Waivers for Scientific Advancement.

(a)

Because the commission and comptroller recognize that computer technology is rapidly changing, an association or totalisator system licensee may petition the commission for a waiver of a totalisator system requirement in a rule of the commission because of new technology.

(b)

To petition for a waiver under this section, the licensee must:

(1)

submit to the pari-mutuel auditor a written application describing in detail the purpose, nature, and extent of the requested waiver; and

(2)

demonstrate the new technology to the pari-mutuel auditor.

(c)

The pari-mutuel auditor shall prepare a written report regarding the new technology and the request for a waiver.

(d)

Not later than the 15th day before the date of the regularly scheduled commission meeting at which the licensee desires action on the petition, the pari-mutuel auditor shall deliver to the commission and the comptroller the licensee's application and the auditor's written report.

(e)

The commission shall grant the waiver if the commission determines that the new technology:

(1)

will satisfy the goals of the totalisator system requirements; and

(2)

will not decrease the efficiency, speed, or accuracy of either the existing pari-mutuel wagering system or the commission's existing pari-mutuel audit function.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904701

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6999


3. Totalisator Operational Requirements

16 TAC §§321.351-321.363

The Texas Racing Commission proposes new Subchapter D, Division 3, §§321.351-321.363to Chapter 321, relating to totalisator operational requirements. These new rule sections are proposed in conjunction with the agency's review of Chapters 305, 309 and 311 in accordance with the requirements of Chapter 1275, Acts of the 75th Legislature, 1997, §55 and the General Appropriations Act of 1997, Article IX, Acts of the 75th Legislature, 1997, §167 (section). This review shall include, at a minimum, an assessment by the agency as to whether the reason for adopting or readopting the rule continues to exist.

As a result of the Commission's review and meetings with the licensed associations and industry related organizations, it was determined that a reorganization of three rule chapters would be beneficial to both the agency and the public. For ease of reference, the agency combined Chapters 305, 309 and 311 into two chapters; one that relates to the licensing and operations of racetracks and one that relates to the licensing and regulation of occupational licensees.

As part of the reorganization of the Commission rules, the agency is complying with the §167 requirements, repealing rules that are redundant with other statutes or rules, updating existing rules to ensure that they are consistent with current agency application and interpretation and group all rules dealing with the same subject matter into one section or placed in one Chapter. This reorganization facilitates future amendments, provides for future expansion and facilitates its use and understanding.

Subchapter D, Division 3 of Chapter 309 relates to the totalisator operational requirements. It is determined that the reason for this division still exists. Therefore, the rules in this division are being incorporated into Chapter 321, which relates to the requirements and regulation of pari-mutuel wagering. A new Subchapter D, Division 3 is being proposed to regulate totalisator operational requirements. Former §§309.451-309.463 will be renumbered §§321.351-321.363.

Roselyn Marcus, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the new rules are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Marcus has also determined that for each of the first five years the new rules are in effect the public benefit anticipated as a result of enforcing the proposal will be that the public and licensed racetracks will find it much easier to find the rules which apply to them, and that the requirements and standards will be clear. There will be consistency between the law, agency and industry practice and the rules. Because this is a reorganization and reclassification of existing Commission rules, the Commission does not believe there will be any new fiscal implications for small businesses and micro-businesses as a result of enforcing the proposed new rules. Similarly, there will be no new anticipated economic cost to an individual required to comply with the new rules as proposed. The proposal has no additional effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries other than the effect of the pre-existing rules.

Comments on the proposal may be submitted on or before September 13, 1999, to Roselyn Marcus, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas, 78711-2080.

The new sections are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorize the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §6.06 which authorizes the Commission to adopt rules regarding racetrack license applications; §11.01, which authorizes the commission to adopt rules to regulate pari-mutuel wagering; and §11.011, which authorizes the commission to adopt rules to regulate pari-mutuel wagering on simulcast races.

The proposal implements Texas Civil Statutes, Article 179e.

§321.351.Pre-race Tests.

(a)

Not later than 48 hours before the start of a race performance, a totalisator system licensee shall test the equipment to be used for the race performance and shall make the repairs and adjustments necessary to ensure that the wagering machines and totalisator computers are operating properly and are recording wagers in accordance with the rules of the commission and the comptroller.

(b)

The test must be conducted with data supplied by the pari-mutuel auditor and must simulate the wagering on a race performance and produce all reports.

§321.352. Totalisator Computer Programs.

(a)

A totalisator system licensee shall ensure that all copies of totalisator computer programs are on magnetic media and are stored in a secured cabinet under the control of an employee of the licensee.

(b)

After a totalisator computer program has been loaded into the computer, the magnetic media must be placed in storage in accordance with subsection (a) of this section.

§321.353.Duplicates of Programs.

(a)

A totalisator system licensee shall maintain a duplicate of each totalisator computer program used during a race meeting. The duplicate must be in the same format as the program used in the totalisator system and must be placed for storage on magnetic tape in a format consistent with §321.326 of this title (relating to Magnetic Tapes).

(b)

The totalisator system licensee shall place the duplicate under seal and deliver the duplicate to the pari-mutuel auditor.

(c)

The pari-mutuel auditor shall retain the duplicate on the grounds of the association for future comparison with the totalisator computer programs actually used during the race meeting.

(d)

On request by the commission, the totalisator system licensee shall produce a copy of the computer program that the totalisator system is currently running.

§321.354.Notice of Modification.

(a)

Except as otherwise provided by this section, a totalisator system licensee who plans to modify the totalisator hardware or a totalisator computer program shall deliver written notice of the proposed modification to the pari-mutuel auditor, the commission, and the comptroller not later than 10 days before the modification is to be made.

(b)

If a totalisator system licensee must modify totalisator hardware or a totalisator computer program in response to an operational problem requiring immediate attention, the licensee shall inform the pari-mutuel auditor, the commission, and the comptroller of the change immediately after the modification is made.

(c)

Not later than five days after modifying a totalisator computer program, the totalisator system licensee shall deliver a program tape of the modification to the commission.

(d)

Unless a modification is made under subsection (b) of this section, after modifying a totalisator computer program, the totalisator system licensee shall conduct tests in accordance with §321.351 of this title (relating to Pre- race Tests) before using the computer program for a race performance.

(e)

A totalisator system licensee shall enter into a written log book, kept in the tote room, all information regarding a modification made under this section. Each entry must include:

(1)

the date and time the problem arose;

(2)

the name of each affected computer program;

(3)

the nature of the problem;

(4)

the nature of the necessary modification;

(5)

the date and time of the modifications; and

(6)

the names of the individuals making the modification.

§321.355.Console Log.

A totalisator system licensee shall ensure that each entry in a console log that contains messages relating to a specific operator console is preceded by the date and the time of the entry.

§321.356.Control of System Use.

(a)

A totalisator system licensee shall establish written procedures approved by the commission and the comptroller for controlling the use of the totalisator system.

(b)

The procedure must control the duplication of computer program tapes and the use of system programs, application programs used to modify master files, and programs used to change system passwords.

§321.357.Reports.

(a)

The totalisator system licensee shall provide to the commission and the comptroller a record transaction layout for each record transaction type on a magnetic tape produced under §321.326 of this title (relating to Magnetic Tapes).

(b)

The totalisator system licensee shall notify the commission and the comptroller in writing of each change to a record transaction layout and the effective date of the change.

(c)

If the totalisator system fails, the totalisator system licensee shall prepare a written report on the system failure and maintain the report with the printed copy of the system log file.

§321.358.Maintenance of Tapes.

If the totalisator system licensee does not operate continuously in Texas, the association shall maintain each magnetic tape produced by the totalisator system, as required by a rule of the commission, on association grounds until the commission and the comptroller certify to the association that the tape is no longer needed for auditing.

§321.359.Access to Computer Equipment.

The totalisator system licensee shall install a security mechanism that detects unauthorized use of the totalisator computer equipment.

§321.360.Security Devices.

(a)

A totalisator system licensee shall maintain, in conjunction with the association, a control log of the identification devices to enter the tote room and a log indicating to whom each device is issued.

(b)

The totalisator system licensee shall ensure that an employee to whom an identification device is issued, on termination of employment, returns the identification device to the totalisator system licensee.

§321.361.Back-up Procedure.

A totalisator system licensee shall establish a back-up procedure approved by the commission and the comptroller to reconstruct all computer programs and data files. The back-up procedures must be able to recover lost data and to provide grandfather-father-son back up.

§321.362.Alternate Power Source.

A totalisator system licensee shall provide an alternate system of electrical power supply capable of providing adequate power to operate the central processing units in which data is stored.

§321.363.Shut-down Procedure.

A totalisator system licensee shall, as part of the normal daily shut-down procedure:

(1)

secure all console logs; and

(2)

secure the totalisator equipment and the totalisator room from unauthorized entry.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 2, 1999.

TRD-9904702

Paula C. Flowerday

Executive Secretary

Texas Racing Commission

Proposed date of adoption: September 15, 1999

For further information, please call: (512) 833-6699