N.Y. Racing, Pari-Mutuel Wagering and Breeding Law § 319

§ 319. Capital improvements. 1. Definitions. For the purposes of this\nsection, the following terms shall have the meanings set forth unless\nthe context requires a different meaning:\n a. "Board" shall mean the New York state racing and wagering board.\n b. "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 which\nis used or is to be used by such corporation or association in\nconnection with the conduct of horse race meetings, and shall include\nimprovements to 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 racing and wagering board to withhold, in addition\nto any other amounts required by this section, one per centum of the\ntotal deposits in pools resulting from regular and multiple bets,\nprovided, however, that any harness track withholding pursuant to this\nsubdivision shall use at least fifty percent of such one per centum\nexclusively for capital improvements as defined in subdivision one of\nthis section subject to the rules and regulations of the racing and\nwagering board. An amount, not to exceed fifty percent of such one per\ncentum, may be used for advertising and promotion expenses subject to\nthe rules and regulations of the board. Provided further, however, that\nif the harness track was owned prior to December thirty-first, nineteen\nhundred eighty-five, by a nonprofit county agricultural society and\nleased by a racing association such one per centum shall be paid by the\nassociation to the society as additional rent. Such society shall use\nsuch one per centum exclusively for capital improvements as defined in\nsubdivision one of this section subject to the rules and regulations of\nthe racing and wagering board. The capital improvements shall be\ndetermined by a committee of the society composed of the executive\ndirector of the society, the chairman of the board of directors of the\nracing association, or his designee, and the general manager of the\nracing association. For the purposes of this paragraph the term\n"advertising" shall be limited to paid advertising through radio,\ntelevision, the print media, direct mail or billboards. Promotions shall\nmean activities which are intended to increase the attendance at, or\nvisibility of, a harness track and shall include premium give-aways,\nprizes, free admission, free parking, free programs, additional monies\nfor purses or other activities of a promotional nature which stimulate\non track attendance. In no event shall this section be construed to\npermit the payment of salaries to employees of such a harness track who\nare 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 board shall, together with the track operator and representatives of\nthe horsemen's organization representing owners and trainers utilizing\nthe facility, inspect the entire facility, including the area commonly\nreferred to as the backstretch, in order to determine whether the\ncapital improvement plan submitted by the association or corporation for\nboard approval includes adequate provision for expenditures relating to\nthe continued health, safety and well-being of patrons, backstretch\npersonnel and the horses in their care. After such inspection, if the\nboard shall determine that such proposed plan does not include adequate\nprovision for repairs and improvements necessary to correct any\nconditions that it has determined to be unsafe or otherwise deleterious\nto the health and safety of patrons, employees or horses, the board\nshall require the track operator to modify its capital improvement plan\nto provide for the expenditure of funds for such repairs and\nimprovements.\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 racing and\nwagering board for the purpose of lending such sums and any interest\nthereon on an unsecured basis to such corporation or association\nexclusively for capital improvements as defined in subdivision one of\nthis section. All such amounts borrowed by such corporation or\nassociation from such trust shall be forgiven and deemed satisfied\naccording to a schedule of depreciation deductions for federal and New\nYork state income tax purposes for such related capital improvements. It\nis further provided that at such time as such corporation or association\nshall surrender its pari-mutuel license or fail to apply for a\npari-mutuel license for the succeeding year by December thirty-first of\nthe preceding year that the racing and wagering board may declare the\ntrust fund at an end and all sums therein deposited plus all sums due or\nowing from such corporation or association to such trust shall be\ndisposed of in accordance with provisions of law to be enacted for such\npurpose; except that the racing and wagering board shall direct that\nsuch sums therein deposited and all sums due and owing from such\ncorporation or association be transferred to the credit of a successor\nin interest to such corporation or association upon the licensing of\nsuch successor in interest by the board. Such trust shall be established\nand administered pursuant to the rules and regulations of the racing and\nwagering board.\n