horse racing; advance deposit wagering

SB1614 - 572R - I Ver

REFERENCE TITLE:
horse racing; advance deposit wagering

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SB 1614

Introduced by

Senator
Shope

AN
ACT

amending sections 5-112 and 5-113.01,
arizona revised statutes; RELATING to horse racing.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 5-112, Arizona Revised
Statutes, is amended to read:

START_STATUTE
5-112.

Wagering legalized; simulcasting of races; unauthorized wagering
prohibited; classification; report; anticompetitive or deceptive practices
prohibited

A. Except as provided in subsection J of this
section, section 5-101.01, subsection F and title 13, chapter 33, any
person within the enclosure of a racing meeting held pursuant to this article
may wager on the results of a race held at the meeting or televised to the
racetrack enclosure by simulcasting pursuant to this section by contributing
money to a pari-mutuel pool operated by the permittee as provided by this
article.

B. The department, on request by a permittee, may
grant permission for electronically televised simulcasts of horse, harness or
dog races to be received by the permittee. In counties with a
population of one million five hundred thousand persons or more, the simulcasts
shall be received at the racetrack enclosure where a horse or harness racing
meeting is being conducted, provided that the simulcast may only be received
during, immediately before or immediately after a minimum of nine posted races
for that racing day. In counties with a population of five hundred
thousand persons or more but less than one million five hundred thousand
persons, the simulcasts shall be received at the racetrack enclosure where a
horse or harness racing meeting is being conducted provided that the simulcast
may only be received during, immediately before or immediately after a minimum
of four posted races for that racing day. In all other counties, the
simulcasts shall be received at a racetrack enclosure at which authorized
racing has been conducted, whether or not posted races have been offered for
the day the simulcast is received.� The simulcasts are limited to horse,
harness or dog races.� The simulcasts are limited to the same type of racing as
authorized in the permit for live racing conducted by the
permittee. The department, on request by a permittee, may grant
permission for the permittee to transmit the live race from the racetrack
enclosure where a horse or harness racing meeting is being conducted to a
facility or facilities in another state.� All simulcasts of horse or harness
races shall comply with the interstate horseracing act of 1978 (P.L. 95-515;
92 Stat. 1811; 15 United States Code chapter 57).� All forms of pari-mutuel
wagering are allowed on horse, harness or dog races, whether or not televised
by simulcasting.� All monies wagered by patrons on these horse, harness or dog
races shall be computed in the amount of money wagered each racing day for the
purposes of section 5-111.

C. Notwithstanding subsection B of this section, in
counties with a population of one million five hundred thousand persons or
more, simulcasts may be received at the racetrack enclosure, and the permittee
may offer pari-mutuel wagering on the simulcast racing at any additional
wagering facility used by a permittee for handling wagering as provided in
section 5-111, subsection A during a permittee's racing meeting as
approved by the commission, whether or not the simulcasts are televised to the
additional wagering facilities and whether or not posted races have been
conducted on the day the simulcast is received, if the permittee's racing
permit requires the permittee to conduct a minimum of one hundred fifty-six
days of live racing with an average of nine posted races on an average of five
racing days each week at the permittee's racetrack enclosure during the period
beginning on October 1 and ending on the first full week in May, unless
otherwise agreed in writing by the permittee and the recognized horsemen's
organization that represents the horsemen participating in the race meet at the
racetrack enclosure, subject to approval by the department.

D. Notwithstanding subsection B of this section, in
counties with a population of seven hundred thousand persons or more but less
than one million five hundred thousand persons, simulcasts may be received at
the racetrack enclosure, and the permittee may offer pari-mutuel wagering
on the simulcast racing at any additional wagering facility used by a permittee
for handling wagering as provided in section 5-111, subsection A during a
permittee's racing meeting as approved by the commission, whether or not the
simulcasts are televised to the additional wagering facilities and whether or
not posted races have been conducted on the day the simulcast is
received. The permittee may conduct wagering on dark day simulcasts
for twenty days, provided the permittee conducts a minimum of seven posted
races on each of the racing days mandated in the permittee's commercial racing
permit. In order to conduct wagering on dark day simulcasts for more
than twenty days, the permittee is required to conduct a minimum of seven posted
races on one hundred forty racing days at the permittee's racetrack enclosure,
unless otherwise agreed in writing by the permittee and the recognized
horsemen's organization that represents the horsemen participating in the race
meet at the racetrack enclosure, subject to approval by the department.

E. In an emergency and on a showing of good cause by
a permittee, the commission may grant an exception to the minimum racing day
requirements of subsections C and D of this section.

F. The minimum racing day requirements of
subsections C and D of this section shall be computed by adding all racing
days, including any county fair racing days operated in accordance with section
5-110, subsection F, allotted to the permittee's racetrack enclosure in
one or more racing permits.

G. Simulcast signals or teletracking of simulcast
signals does not prohibit live racing or teletracking of that live racing in
any county at any time.

H. Except as provided in subsection J of this
section, section 5-101.01, subsection F and title 13, chapter 33, any
person within a racetrack enclosure or an additional facility authorized for
wagering pursuant to section 5-111, subsection A may wager on the results
of a race televised to the facility pursuant to section 5-111, subsection
A by contributing to a pari-mutuel pool operated as provided by this
article.

I. Except as provided in this article and in title
13, chapter 33, all forms of wagering or betting on the results of a race,
including buying, selling, cashing, exchanging or acquiring a financial
interest in pari-mutuel tickets, except by operation of law, whether the
race is conducted in this state or elsewhere, are illegal.

J. A permittee shall not knowingly permit a person
who is under twenty-one years of age to be a patron of the pari-mutuel
system of wagering.

K. Except as provided in title 13, chapter 33, any
person who violates this article with respect to any wagering or betting,
whether the race is conducted in or outside this state, is guilty of a class 6
felony.

L. Simulcasting may only be authorized for the same
type of racing authorized by a permittee's live racing permit.

M. In addition to pari-mutuel wagering
otherwise authorized by this chapter, a commercial live-racing permittee or a
commercial dog racing permittee that conducted live dog racing in 2016 may
conduct advance deposit wagering as approved by the commission. The
commission also may allow advance deposit wagering by an advance deposit
wagering provider if a racing authority in the state where the advance deposit
wagering provider is located approves the advance deposit wagering provider
and, for horse racing, if the advance deposit wagering provider annually
secures the approval of the commercial live horse racing permittees in a county
where the advance deposit wagering provider or commercial live-racing
permittee accepts advance deposit wagers for horse racing and of the
organization that represents the majority of owners and trainers at each of the
commercial live horse racing enclosures in each county. An advance
deposit wagering provider that the commission approves shall pay source market
fees on wagers placed on horse racing from this state to commercial live horse
racing permittees in this state. The advance deposit wagering
provider shall divide the source market fees on horse racing wagers on the
basis of the proportion of the permittees' total live and simulcast handle
during the previous year and the advance deposit wagering provider shall pay
source market fees on wagers on dog racing from the county in which the live or
simulcast racing is conducted to the commercial live racing permittee in that county. The
advance deposit wagering provider shall divide the source market fees on dog
racing from wagering in any other county as provided in a written agreement
that is submitted to the department between all commercial dog racing permittees.

N. The commission may issue a permit to authorize an
advance deposit wagering provider to accept advance deposit wagering on racing
from persons in this state. The procedures for the approval of the
permit must be similar to the procedures for the approval of racing permits
under this article, subject to the following requirements:

1. The commission shall issue an advance deposit
wagering permit only if the state agency that regulates racing in the state
where the advance deposit wagering provider is located approves the permittee
or provider to conduct advance deposit wagering.

2. An advance deposit wagering provider may accept
advance deposit pari-mutuel wagers from natural persons in this state on racing
conducted by a commercial live-racing permittee in this state or on racing
conducted outside this state if the commercial live-racing permittee in this
state at a racetrack enclosure in a county where live horse or live dog racing
has been conducted for a period of at least forty days per year for at least
twelve consecutive years beginning after 1992 or at a new racetrack enclosure
in the same county that replaced the previously existing racetrack enclosure on
which advance deposit wagering is accepted or that conducts a racing program
with the same type of racing on which the advance deposit wagering is accepted
enters into an agreement with the advance deposit wagering provider providing
for the payment of a source market fee that is agreed to by the commercial
live-racing permittee on all advance deposit wagering.

3. An advance deposit wagering provider shall pay
source market fees in an amount that is agreed to by the commercial live-racing
permittee on all advance deposit wagering by persons in this state on the same
type of racing the commercial live-racing permittee conducts. Source
market fees from wagers by persons in this state through an advance deposit
wagering provider shall be allocated as provided in paragraph 7 of this
subsection to a commercial live horse racing permittee at a racetrack enclosure
in a county where live horse racing has been conducted for a period of at least
forty days per year for at least twelve consecutive years beginning after 1992
or at a new racetrack enclosure in the same county that replaced the previously
existing racetrack enclosure during the period of time that the commercial
live-racing permittee conducts a racing program. Source market fees
for dog racing from wagering through the advance deposit wagering provider from
persons wagering in a county shall be allocated as provided in paragraph 7 of
this subsection to a commercial dog racing permittee at a racetrack enclosure
in a county where live dog racing had been conducted in 2016 or had been
conducted for a period of at least forty days per year for at least twelve consecutive
years beginning after 1992 or at a new racetrack enclosure in the same county
that replaced the previously existing racetrack enclosure. Source
market fees from wagers by persons in this state in all other counties for pari-mutuel
wagering on dog racing through an advance deposit wagering provider shall be
allocated as provided in paragraph 7 of this subsection.

4. Advance deposit wagering agreements that are
executed between permittees in this state must contain the same or
substantially equivalent terms and conditions, including provisions for revenue
sharing, as the terms and conditions contained in simulcasting agreements that
are executed between those same permittees in order to accept advance deposit
wagering on horse racing from a county with a commercial dog racing permittee.

5. The advance wagering provider shall transmit
daily a percentage determined by the department of the gross revenues generated
by advance deposit wagers to the department for deposit in the racing
regulation fund established by section 5-113.01.

6. The advance deposit wagering provider shall file
the consent provided for in this subsection with the commission, and the
consent is valid for a period of at least one year.

7. The source market fees are allocated, after
deductions, as provided for in section 5-111, subsection C for horse
racing for any fees or payments to the state, county and city for taxes or
other fees, in the same manner as the proceeds of simulcast pari-mutuel
wagering as provided in section 5-111, subsection C for horse
racing. From the source market fees from advance deposit wagering on
horse racing allocated for purses as provided in section 5-111,
subsection C, five percent is paid to the department for deposit in the Arizona
breeders' award fund account for distributions for Arizona bred horses as
provided in section 5-114.

O. The owner of the advance deposit wagering account
may make an advance deposit pari-mutuel wager only by telephone.

P. Only the advance deposit wagering provider may
make an advance deposit wager, pursuant to wagering instructions the owner of
the monies issues by telephone. The advance deposit wagering
provider shall ensure the identification of the owner of the account by using
methods and technologies approved by the commission. Any advance
deposit wagering provider that accepts wagering instructions on races that are
conducted in this state, or accepts wagering instructions originating in this
state, shall provide a daily report that contains a full accounting and
verification of the source of the wagers made, including the postal zip code of
the source of the wagers and all pari-mutuel data, in a form and manner that is
approved by the commission. All reasonable costs associated with the
creation, provision and transfer of the data is the responsibility of the
advance deposit wagering provider.

Q. Any person other than a permittee or any advance
deposit wagering provider who is approved by the commission under this article
and who accepts a wager or who bets on the results of a race, whether the race
is conducted in or outside this state, including buying, selling, cashing,
exchanging or acquiring a financial interest in a pari-mutuel ticket from
a person in this state outside of a racing enclosure or an additional wagering
facility that is approved by the commission and that is located in this state
is guilty of a class 6 felony.

R. Pursuant to section 13-108, a pari-mutuel
wager or a bet placed or made by a person in this state is deemed for all
purposes to occur in this state.

S. The department and the attorney general shall
enforce subsections Q and R of this section and shall submit an annual report
that summarizes these enforcement activities to the governor, the speaker of
the house of representatives and the president of the senate. The
department and the attorney general shall provide a copy of this report to the
secretary of state.

T. Each commercial live-racing permittee in this
state shall enter into an agreement that complies with this
subsection. Simulcasts that originate from a racetrack enclosure
that conducts live racing in this state shall be offered to each commercial
live-racing permittee in this state and additional wagering facility in this
state. Each simulcast agreement executed pursuant to this subsection
is subject to approval by the commission.� The commission shall approve the
simulcast agreement if the commission determines that the agreement is
reasonable and complies with the requirements of this subsection.� A permittee
may not engage in any anticompetitive or deceptive practice in offering to send
the permittee's simulcast to another commercial live-racing permittee or
additional wagering facility in this state. For the purposes of this
subsection, an anticompetitive or deceptive practice includes any of the
following:

1. Any agreement to charge excessive or unreasonable
fees for the right to receive the simulcasts. In determining whether
a fee is excessive or unreasonable, the commission shall consider prevailing
rates paid for comparable simulcast signals in the past, prevailing rates paid
outside this state and whether any commonality of ownership or revenue sharing
exists, partially or wholly, between the permittee in this state and the entity
that receives the simulcast fee.

2. Any agreement, combination, trust or joint
enterprise with any other racetrack or entity in which multiple simulcast
signals are bundled together for the purpose of securing an excessive or
unreasonable fee for one or more simulcast signals in the group in exchange for
the right to receive any of the signals in that group.

3. Any other activity with the purpose or effect of
artificially inflating prices beyond reasonable market rates.

U. Any simulcast of live racing into this state that
originates from outside this state shall comply with this subsection.� The
simulcast must be offered to each commercial live-racing permittee in this
state and additional wagering facility in this state. Each simulcast
agreement executed pursuant to this subsection is subject to approval by the
commission.� The commission shall approve the simulcast agreement if the
commission determines that the agreement is reasonable and complies with the
requirements of this subsection.� A provider of simulcasts originating from
outside
of
this state may not engage in any
anticompetitive or deceptive practice in offering to contract for the privilege
to send any interstate simulcast to a commercial live-racing permittee or
additional wagering facility in this state.� For the purposes of this
subsection, an anticompetitive or deceptive practice includes any of the
following:

1. Any agreement to charge excessive or unreasonable
fees for the right to receive the interstate simulcasts.� In determining
whether a fee is excessive or unreasonable, the commission shall consider
prevailing rates paid for comparable simulcast signals in the past, prevailing
rates paid outside this state and whether any commonality of ownership or
revenue sharing exists, partially or wholly, between the permittee in this
state and the entity receiving the simulcast fee.

2. Any agreement, combination, trust or joint
enterprise with any other racetrack or entity in which multiple interstate
signals are bundled together for the purpose of securing an excessive or
unreasonable fee for one or more simulcast signals in the group in exchange for
the right to receive any of the signals in that group.

3. Any other activity with the purpose or effect of
artificially inflating prices beyond reasonable market rates.

V. nOTWITHSTANDING ANY OTHER LAW, If
there is no licensed racetrack enclosure in this state that is authorized to
conduct live racing meetings, this subsection AND subsections W, X and Y of
this section apply to advance deposit wagering.� The commission shall allow for
advance deposit wagering through an advance deposit wagering provider that, as
of the date of this amendment to this section, has received from the commission
a valid permit to accept advance deposit wagers.� The advance deposit wagering
provider may accept advance deposit wagers independent from the operation of a
racetrack enclosure or a wagering facility.� The advance deposit wagering
provider may accept pari-mutuel wagers that are placed by a person in
this state through telephone, internet or other electronic means if the person
has established a valid advance deposit wagering account.
�
The advance deposit wagering provider is not required to conduct live
racing meetings or operate a racetrack enclosure or wagering facility in this
state.

W. Notwithstanding any other law,
during any period in which advance deposit wagering is authorized by the
commission pursuant to subsection V of this section, each advance deposit
wagering provider shall remit to the department, after the deduction of all
state, county, city or town taxes and fees, a fee that is equivalent to the
source marketing fee that is required under the advance deposit wagering
provider's last active contract with a commercial live-racing permittee for the
advance deposit wagering handle that is received from persons in this state who
have a valid advance deposit wagering account.� The department shall deposit,
pursuant to sections 35-146 and 35-147, the fee required pursuant
to this subsection in the racing regulation fund that is established by section
5-113.01.

X. Notwithstanding any other law, If
there is no licensed racetrack enclosure in this state that is authorized to
conduct live racing meetings, an advanced deposit wagering provider that has
received, AS OF THE DATE OF THIS AMENDMENT TO THIS SECTION, a permit from the
commission may accept advance deposit wagers on any simulcast event for which
the advance deposit wagering provider has an approved agreement pursuant to the
interstate horseracing act of 1978 (P.L. 95-515; 15 United States Code
chapter 57). Advance deposit wagering conducted pursuant to
this subsection is not limited to simulcast signals or contracts that are
associated with a racetrack enclosure licensee and are subject to subsections V
and W of this section.

Y. If the department issues a license
to a racetrack enclosure in this state to conduct live racing, the advance
deposit wagering provider that is authorized pursuant to subsections v, W and X
of this section, on order from the commission, may continue to accept advance
deposit wagers on a provisional basis until the advanced deposit wagering
provider enters into the agreement that is required by subsection N, paragraph
2 of this section.
END_STATUTE

Sec. 2. Section 5-113.01, Arizona Revised
Statutes, is amended to read:

START_STATUTE
5-113.01.

Racing regulation fund; exemption

The racing regulation fund is established. All
revenues derived from permittees, permits and licenses pursuant to this article
, DEPOSITs MADE PURSUANT TO SECTION 5-112
and any grants
or donations received by the department shall be deposited, pursuant to
sections 35-146 and 35-147, in the racing regulation
fund. The department shall administer the racing regulation
fund. Monies in the racing regulation fund are subject to
legislative appropriation and are to be used by the department to support the
mission of the department. The racing regulation fund is exempt from
the provisions of section 35-190 relating to lapsing of appropriations.
END_STATUTE