§ 319 — Capital improvements

§ 319. Capital improvements. 1. For the purposes of this section,\n"capital improvement" shall mean any addition to, replacement of or\nremodeling of the physical plant, structures and equipment now or\nhereafter owned or leased by a racing corporation or association that is\nused or is to be used by such corporation or association in connection\nwith the conduct of horse race meetings, and shall include improvements\nto land but not land itself.\n 2. (a) Notwithstanding the provisions of section three hundred\neighteen of this article, a harness track, may elect upon thirty days\nwritten notice to the commission to withhold, in addition to any other\namounts required by this section, one percent of the total deposits in\npools resulting from regular and multiple bets, provided, however, that\nany harness track withholding pursuant to this subdivision shall use at\nleast fifty percent of such one percent exclusively for capital\nimprovements as defined in subdivision one of this section subject to\nthe rules and regulations of the commission. An amount, not to exceed\nfifty percent of such one percent, may be used for advertising and\npromotion expenses subject to the rules and regulations of the\ncommission. Provided further, however, that if the harness track was\nowned prior to December thirty-first, nineteen hundred eighty-five, by a\nnonprofit county agricultural society and leased by a racing association\nsuch one percent shall be paid by the association to the society as\nadditional rent. Such society shall use such one percent exclusively for\ncapital improvements as defined in subdivision one of this section\nsubject to the rules and regulations of the commission. The capital\nimprovements shall be determined by a committee of the society composed\nof the executive director of the society, the chair of the board of\ndirectors of the racing association, or his or her designee, and the\ngeneral manager of the racing association. For the purposes of this\nparagraph the term "advertising" shall be limited to paid advertising\nthrough radio, television, the print media, direct mail or billboards.\nPromotions shall mean activities that are intended to increase the\nattendance at, or visibility of, a harness track and shall include\npremium giveaways, prizes, free admission, free parking, free programs,\nadditional monies for purses or other activities of a promotional nature\nwhich stimulate on track attendance. In no event shall this section be\nconstrued to permit the payment of salaries to employees of such a\nharness track who are engaged in advertising or promotional activities.\n (b) At least once annually, prior to approving any plan for the\nexpenditure of such capital improvement funds pursuant to this section,\nthe commission shall, together with the track operator and\nrepresentatives of the horsemen's organization representing owners and\ntrainers using the facility, inspect the entire facility, including the\narea commonly referred to as the backstretch, in order to determine\nwhether the capital improvement plan submitted by the association or\ncorporation for commission approval includes adequate provision for\nexpenditures relating to the continued health, safety and well-being of\npatrons, backstretch personnel and the horses in their care. After such\ninspection, if the commission shall determine that such proposed plan\ndoes not include adequate provision for repairs and improvements\nnecessary to correct any conditions that it has determined to be unsafe\nor otherwise deleterious to the health and safety of patrons, employees\nor horses, the commission shall require the track operator to modify its\ncapital improvement plan to provide for the expenditure of funds for\nsuch repairs and improvements.\n 3. On or after July first, nineteen hundred ninety for a harness track\nother than a harness track authorized to operate in Westchester or\nNassau county or a harness track owned by a non-profit county\nagricultural society and leased by a harness racing association such\namounts as may be withheld for the purposes of this section shall be\ndeposited in a trust fund, kept and maintained by such corporation or\nassociation and administered by a trustee approved by the commission for\nthe purpose of lending such sums and any interest thereon on an\nunsecured basis to such corporation or association exclusively for\ncapital improvements as defined in subdivision one of this section. All\nsuch amounts borrowed by such corporation or association from such trust\nshall be forgiven and deemed satisfied according to a schedule of\ndepreciation deductions for federal and New York state income tax\npurposes for such related capital improvements. It is further provided\nthat at such time as such corporation or association shall surrender its\npari-mutuel license or fail to apply for a pari-mutuel license for the\nsucceeding year by December thirty-first of the preceding year that the\ncommission may declare the trust fund at an end and all sums therein\ndeposited plus all sums due or owing from such corporation or\nassociation to such trust shall be disposed of in accordance with\nprovisions of law to be enacted for such purpose; except that the\ncommission shall direct that such sums therein deposited and all sums\ndue and owing from such corporation or association be transferred to the\ncredit of a successor in interest to such corporation or association\nupon the licensing of such successor in interest by the commission. Such\ntrust shall be established and administered pursuant to the rules and\nregulations of the commission.\n