PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:
Proposed action:
Amendment of sections 4122.10 and 4005.4 of Title 9 NYCRR.
Statutory authority:
Racing, Part-Mutuel Wagering and Breeding Law, sections 101 and 301
Subject:
Pari-mutuel corporation employees prohibited from making wagers while on duty.
Purpose:
To prohibit employees who are employed in the pari-mutuel department of any corporation or association licensed to conduct harness racing or thoroughbred racing in the State of New York from betting on duty. The rule is intended to avoid the actual or apparent misconduct of a pari-mutuel employee given his or her unique position in the pari-mutuel wagering system.
Text of proposed rule:
Section 4005.4 of 9E NYCRR is amended to read as follows:
4005.4. Pari-mutuel employees forbidden to bet.
No employee of the pari-mutuel department of any licensed association shall[, during the period of his said employment, bet upon the outcome of any race conducted by any such licensed association,] be permitted to bet during those periods of any day on which such person is actually working in such capacity.
Section 4122.10 of 9E NYCRR is amended to read as follows:
4122.10 Method of wagering
The method of selling pari-mutuel tickets shall be approved by the Harness Racing Commission and the State Tax Commission. No employee of a licensed track assigned to or working in the pari-mutuel department shall accept a wager from any person except through the track's pari-mutuel windows and in the regular course of business. No employee of the pari-mutuel department of any licensed corporation or association shall be permitted to bet during those periods of any day which such person is actually working in such capacity.
Text of proposed rule and any required statements and analyses may be obtained from:
Gail Pronti, Secretary to the Board, Racing and Wagering Board, One Broadway Center, Suite 600, Schenectady, NY 12305, (518) 395-5400, e-mail: info@racing.state.ny.us
Data, views or arguments may be submitted to:
Same as above.
Public comment will be received until:
45 days after publication of this notice.
This action was not under consideration at the time this agency's regulatory agenda was submitted.
Regulatory Impact Statement
(a) STATUTORY AUTHORITY: Racing, Pari-Mutuel Wagering and Breeding Law, sections 101 and 301. Section 101 of the Racing, Pari-Mutuel Wagering and Breeding Law vests the Board with general jurisdiction over all horse racing and all pari-mutuel wagering activities in New York State. Section 301 grants the Board the authority to supervise generally all harness race meetings in New York State at which pari-mutuel betting is conducted and the authority to adopt rules accordingly.
(b) LEGISLATIVE OBJECTIVES: This proposed amendment advances the legislative objective of regulating the conduct of pari-mutuel racing in a manner designed to maintain the integrity of racing while generating a reasonable revenue for the support of government.
(c) NEEDS and BENEFITS: This rule is needed to prevent the apparent or actual improprieties that occur when an employee of the pari-mutuel division of a harness or thoroughbred racing track. While wagering on track races by employees of the pari-mutuel division of a thoroughbred racing track is currently prohibited by 9E NYCRR 4005.4, this amendment would expand that rule to prohibit such employees from wagering on simulcast races. Both the thoroughbred rule and the harness rule will be consistent with each other.
The pari-mutuel division is responsible for accepting wagers, managing cash, paying holders of winning pari-mutuel tickets, and generally interacting with the public at a race track's betting windows.
A pari-mutuel window teller occupies a unique position of trust in the eyes of the public. In addition to the obvious fact that a pari-mutuel teller is responsible for handling tens of thousands of dollars and day and entering complex wagers into a computer, the window teller is often seen by the public as a racing insider. Whether real or perceived, the public sees the pari-mutuel teller as someone who may have access to exclusive wagering information regarding horses or betting patterns in a any given race. If the pari-mutuel employee is allowed to place wagers while on duty, it may appear that the teller is exploiting his position for personal gain, thereby eroding public confidence in pari-mutuel wagering in general.
The prohibition against wagering by window tellers is also intended to prohibit a practice known as “10 percenting.” Certain individuals are disqualified from pari-mutuel wagering due to the fact that they may be persons with a criminal history or association. In order to evade detection, these excluded persons find willing pari-mutuel tellers who covertly handle their wagers in return for a 10 percent fee. While it may appear that the teller is processing a wager for himself, he is at best circumventing legitimate rules designed to exclude criminal elements, and at worst aiding and abetting criminal enterprises. This rule will compliment Board Rule 4122.10, which states that “No employee of a licensed track assigned to or working in the pari-mutuel department shall accept a wager from any person except through the track's pari-mutuel window and in the regular course of business.”
Monticello Raceway has already adopted its own policy of prohibiting raceway employees from betting at the track.
(d) COSTS: There are no projected costs to regulated persons or state and local governments associated with the adoption of this rule. As is apparent from the nature of this rule, there are no costs imposed on track associations, and the rule will prohibit certain types of expenditures by harness track employees and therefore no costs are imposed.
(e) PAPERWORK: There will be no new paperwork created by this prohibition.
(f) LOCAL GOVERNMENT MANDATES: Since the New York State Racing Wagering Board is solely responsible for the regulations of pari-mutuel wagering activities in the State of New York, there is no program, service, duty or responsibility imposed by the rule upon any county, city, town, village, school district, fire district or other special district.
(g) DUPLICATION: There are no relevant rules or legal requirements of the state and federal governments that duplicate, overlap or conflict with the amendment of Board Rule.
(h) ALTERNATIVE APPROACHES: The other alternative would be to allow certain track employees to place bets while in duty. This would be counterproductive to the goals stated above.
(i) FEDERAL STANDARDS: There are no federal standards for pari-mutuel wagering on harness races in New York State.
(j) COMPLIANCE SCHEDULE: The rule would be effective immediately upon publication of the Notice of Adoption in the State Register.
Regulatory Flexibility Analysis, Rural Area Flexibility Analysis and Job Impact Statement
This proposal does not require a Regulatory Flexibility Statement, Rural Area Flexibility Statement or Job Impact Statement as the amendment addresses the wagering activities of harness and thoroughbred track employees. It does not diminish their substantive job duties or their opportunity to earn a living. The rule prohibits an employee of the pari-mutuel wagering division of a harness or thoroughbred racetrack from wagering on races while in duty. The rule does not prohibit them from wagering altogether. The employees can still wager when off-duty or at other pari-mutuel wagering venues. Consequently, as is apparent from the nature of rule, the rule neither affect small business, local governments, job nor rural areas. Prohibiting wagering activities of part-mutuel wagering employees does not impact upon a small business pursuant to such definition in the State Administrative Procedure Act § 102(8). Nor does it affect employment. The proposal will not impose an adverse economic impact on reporting, recordkeeping or other compliance requirements on small businesses in rural or urban areas nor on employment opportunities. The rule does not impose any significant technological changes on the industry for the reasons set forth above.
