Part 8. TEXAS RACING COMMISSION
Chapter 309. RACETRACK LICENSES AND OPERATIONS
Subchapter A. RACETRACK LICENSES
The Texas Racing Commission adopts an amendment to §309.8, relating to the license fees charged to pari-mutuel racetracks, without changes to the proposed text as published in the December 29, 2006, issue of the Texas Register (31 TexReg 10487). The section creates an annual license fee for active pari-mutuel racetracks, increases the annual license fee for licensed but inactive pari-mutuel racetracks, and deletes the additional fee charged to an association that conducts the Breeders' Cup races.
As a result of this change, the Commission will receive an additional $452,500 in revenue during fiscal year 2007, and an additional $790,000 in each subsequent fiscal year. This additional revenue is necessary to fund agency operations for fiscal year 2007 and subsequent years.
The Commission received five comments regarding the rule. The first commenter stated that the amount of increase in the annual inactive license fee for Class 2 racetracks is excessive and thereby violates §5.01(b) of the Texas Racing Act, which states that the commission shall annually prescribe reasonable license fees for each category of license. The commission disagrees with the comment and responds that the fee is reasonable in comparison to the total cost of regulating the industry and the inactive licensees' share of the indirect expenses associated with that regulation. The commission further responds that the amount of the inactive license fees is reasonable in comparison to the active license fees when the commission takes into consideration the overall contributions made by active licensees.
The second commenter expressed concern that the rule assessed the same license fee for active greyhound racetracks, regardless of the length of the racing season. The commenter requested that the rule be modified to reduce the proposed annual fee for greyhound racetracks conducting fewer than six months of live racing. The commission disagrees with the comment and responds that, unlike the live racing fees, the annual active license fees are designed to be a flat fee.
Three additional commenters supported the fee increases, but requested that the commission revisit the issue before the next fiscal year to determine whether the fees could be adjusted to be more equitable for all the stakeholders. The commission agrees with this comment and will convene a working group for this purpose.
The amendment is adopted under the Texas Civil Statutes, Article 179e, §3.02 which authorizes the Commission to make rules relating exclusively to horse and greyhound racing; §5.01, which authorizes the Commission to prescribe reasonable license fees for each category of license; §6.06, which authorizes the Commission to adopt rules on all matters relating to the planning, construction, and operation of racetracks; and §6.18, which authorizes the Commission to prescribe a reasonable annual fee to be paid by each racetrack licensee.
This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of the Secretary of State on March 5, 2007.
TRD-200700863
Mark Fenner
General Counsel
Texas Racing Commission
Effective date: March 25, 2007
Proposal publication date: December 29, 2006
For further information, please call: (512) 833-6699