SENATE BILL 85

50th legislature - STATE OF NEW MEXICO - first session, 2011

INTRODUCED BY

Steven P. Neville

 

 

 

FOR THE GOVERNMENT RESTRUCTURING TASK FORCE

 

AN ACT

RELATING TO EXECUTIVE ORGANIZATION; TRANSFERRING REGULATORY AUTHORITY FOR HORSE RACING, PARI-MUTUEL WAGERING, SIMULCASTING, INTERSTATE COMMON POOL WAGERING, LICENSING AUTHORITY AND OTHER ADMINISTRATIVE DUTIES TO THE GAMING CONTROL BOARD; TRANSFERRING FUNCTIONS, APPROPRIATIONS, MONEY, PROPERTY, CONTRACTUAL OBLIGATIONS AND STATUTORY REFERENCES; AMENDING, REPEALING AND ENACTING SECTIONS OF THE NMSA 1978.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. Section 60-2E-1 NMSA 1978 (being Laws 1997, Chapter 190, Section 3, as amended) is amended to read:

     "60-2E-1. SHORT TITLE.--Chapter 60, Article 2E NMSA 1978 may be cited as the "Gaming Control and Horse Racing Act"."      SECTION 2. Section 60-2E-2 NMSA 1978 (being Laws 1997, Chapter 190, Section 4) is amended to read:

     "60-2E-2. POLICY.--It is the state's policy on gaming and horse racing that:

          A. limited gaming activities and pari-mutuel wagering should be allowed in the state if those activities are strictly regulated to ensure honest and competitive gaming and horse racing that is free from criminal and corruptive elements and influences; and

          B. the holder of any license issued by the state in connection with the regulation of gaming activities and pari-mutuel wagering has a revocable privilege only and has no property right or vested interest in the license."

     SECTION 3. Section 60-2E-3 NMSA 1978 (being Laws 1997, Chapter 190, Section 5, as amended) is amended to read:

     "60-2E-3. DEFINITIONS.--As used in the Gaming Control and Horse Racing Act:

          A. "affiliate" means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with a specified person;

          B. "affiliated company" means a company that:

                (1) controls, is controlled by or is under common control with a company licensee; and

                (2) is involved in:

                     (a) gaming activities; [or involved in]

                     (b) pari-mutuel wagering; or

                     (c) the ownership of property on which gaming, pari-mutuel wagering or horse racing is conducted;

          C. "applicant" means a person who has applied for a license or for approval of an act or transaction for which approval is required or allowed pursuant to the provisions of the Gaming Control and Horse Racing Act;

          D. "application" means a request for the issuance of a license or for approval of an act or transaction for which approval is required or allowed pursuant to the provisions of the Gaming Control and Horse Racing Act; but "application" does not include a supplemental form or information that may be required with the application;

          E. "associated equipment" means equipment or a mechanical, electromechanical or electronic contrivance, component or machine used in connection with gaming activity;

          F. "board" means the gaming control board;

          G. "certification" means a notice of approval by the board of a person required to be certified by the board;

          H. "cheat" or "cheating" means to alter the element of chance, the method of selection or other criteria in a manner that determines:

                (1) the result of the game;

                (2) the amount or frequency of payment in a game, including taking advantage of a malfunctioning machine;

                (3) the value of a wagering instrument; or

                (4) the value of a wagering credit;

          I. "company" means a corporation, partnership, limited partnership, trust, association, joint stock company, joint venture, limited liability company or other form of business organization that is not a natural person; "company" does not mean a nonprofit organization;

          J. "distributor" means a person who supplies gaming devices to a gaming operator but does not manufacture gaming devices;

          K. "equity security" means an interest in a company that is evidenced by:

                (1) voting stock or similar security;

                (2) a security convertible into voting stock or similar security, with or without consideration, or a security carrying a warrant or right to subscribe to or purchase voting stock or similar security;

                (3) a warrant or right to subscribe to or purchase voting stock or similar security; or

                (4) a security having a direct or indirect participation in the profits of the issuer;

          L. "executive director" means the chief administrative officer appointed by the board pursuant to Section 60-2E-7 NMSA 1978;

          M. "finding of suitability" means a certification of approval issued by the board permitting a person to be involved directly or indirectly with a licensee, relating only to the specified involvement for which it is made;

          N. "foreign institutional investor" means:

                (1) a government-related pension plan of a foreign government; or

                (2) a person that meets the requirement of a qualified institutional buyer as defined by the governing financial regulatory agency of the foreign country in which the company's primary operations are located and is registered or licensed in that country as a bank, an insurance company, an investment company, an investment advisor, a collective trust fund, an employee benefit plan or pension fund sponsored by a publicly traded corporation registered with the board or a group composed entirely of entities specified in this subsection;

          O. "game" means an activity in which, upon payment of consideration, a player receives a prize or other thing of value, the award of which is determined by chance even though accompanied by some skill; "game" does not include an activity played in a private residence in which no person makes money for operating the activity except through winnings as a player;

          P. "gaming" means offering a game for play;

          Q. "gaming activity" means an endeavor associated with the manufacture or distribution of gaming devices or the conduct of gaming;

          R. "gaming device" means associated equipment or a gaming machine and includes a system for processing information that can alter the normal criteria of random selection that affects the operation of a game or determines the outcome of a game;

          S. "gaming employee":

                (1) means a person who is connected directly with:

                     (a) a gaming activity; ["gaming employee"]

                     (b) a horse racetrack if that person performs accounting, administration or management, cash handling, pari-mutuel wagering operations, security or simulcasting operations for the racetrack; or

                     (c) a horse racetrack if that person has access to a restricted area on a licensed premises, including a horse owner, trainer, jockey, agent, apprentice, groom, exercise person, veterinarian, valet, farrier, starter, clocker, racing secretary, pari-mutuel clerk and other personnel designated by the board whose work, in whole or in part, is conducted around racehorses or a pari-mutuel

betting window; and

                (2) does not include:

                     [(1)] (a) bartenders, cocktail servers or other persons engaged solely in preparing or serving food or beverages;

                     [(2)] (b) secretarial or janitorial personnel;

                     [(3)] (c) stage, sound and light technicians; [or]

                     (d) a horseman's bookkeeper; or

                     [(4)] (e) other nongaming personnel;

          T. "gaming establishment" means the premises on or in which gaming is conducted;

          U. "gaming machine" means a mechanical, electromechanical or electronic contrivance or machine that, upon insertion of a coin, token or similar object, or upon payment of any consideration, is available to play or operate a game, whether the payoff is made automatically from the machine or in any other manner;

          V. "gaming operator" means a person who conducts gaming at a gaming establishment or pari-mutuel wagering at a horse racetrack on live or simulcast horse races;

          W. "holding company" means a company that, directly or indirectly, owns or has the power or right to control a company that is an applicant or licensee; [but] "holding company" does not include a company that does not have a beneficial ownership of more than ten percent of the equity securities of a publicly traded corporation [is not a holding company];

          X. "horse race" means a competition among horses, on a predetermined course, in which the horse that completes the course in the least amount of time generally wins;

          Y. "horse racetrack" means a place where horse races are conducted;

          [X.] Z. "immediate family" means natural persons who are related to a specified natural person by affinity or consanguinity in the first through the third degree;

          [Y.] AA. "independent administrator" means a person who administers an annuity, who is not associated in any manner with the gaming operator licensee for which the annuity was purchased and who is in no way associated with the person who will be receiving the annuity;

          [Z.] BB. "institutional investor" means:

                (1) a foreign institutional investor;

                (2) a state or federal government pension plan; or

                (3) a person that meets the requirements of a qualified institutional buyer as defined in Rule 144A of the federal Securities Act of 1933, and is:

                     (a) a bank as defined in Section 3(a)(6) of the federal Securities Exchange Act of 1934;

                     (b) an insurance company as defined in Section 2(a)(17) of the federal Investment Company Act of 1940;

                     (c) an investment company registered under Section 8 of the federal Investment Company Act of 1940;

                     (d) an investment adviser registered under Section 203 of the federal Investment Advisers Act of 1940;

                     (e) collective trust funds as defined in Section 3(c)(11) of the federal Investment Company Act of 1940;

                     (f) an employee benefit plan or pension fund that is subject to the federal Employee Retirement Income Security Act of 1974, excluding an employee benefit plan or pension fund sponsored by a publicly traded corporation registered with the board; or

                     (g) a group [comprised] composed entirely of persons specified in Subparagraphs (a) through (f) of this paragraph;

          [AA.] CC. "intermediary company" means a company that:

                (1) is a holding company with respect to a company that is an applicant or licensee; and

                (2) is a subsidiary with respect to any holding company;

          [BB.] DD. "key executive" means an executive of a licensee or other person having the power to exercise significant influence over decisions concerning any part of the licensed operations of the licensee or whose compensation exceeds an amount established by the board in a rule;

          [CC.] EE. "license" means an authorization required by the board for engaging in gaming activities, horse racing or pari-mutuel wagering;

          [DD.] FF. "licensee" means a person to whom a valid license has been issued;

          [EE.] GG. "manufacturer" means a person who manufactures, fabricates, assembles, produces, programs or makes modifications to any gaming device for use or play in New Mexico or for sale, lease or distribution outside New Mexico from any location within New Mexico;

          [FF.] HH. "net take" means the total of the following, less the total of all cash paid out as losses to winning patrons and those amounts paid to purchase annuities to fund losses paid to winning patrons over several years by independent administrators:

                (1) cash received from patrons for playing a game or pari-mutuel wagering;

                (2) cash received in payment for credit extended by a licensee to a patron for playing a game or pari-mutuel wagering; and

                (3) compensation received for conducting a game or pari-mutuel wagering in which the licensee is not a party to a wager;

          [GG.] II. "nonprofit organization" means:

                (1) a bona fide chartered or incorporated branch, lodge, order or association, in existence in New Mexico prior to January 1, 1997, of a fraternal organization that is described in Section 501(c)(8) or (10) of the federal Internal Revenue Code of 1986 and that is exempt from federal income taxation pursuant to Section 501(a) of that code; or

                (2) a bona fide chartered or incorporated post, auxiliary unit or society of, or a trust or foundation for the post or auxiliary unit, in existence in New Mexico prior to January 1, 1997, of a veterans' organization that is described in Section 501(c)(19) or (23) of the federal Internal Revenue Code of 1986 and that is exempt from federal income taxation pursuant to Section 501(a) of that code;

          JJ. "pari-mutuel wagering" means a system of wagering in which bets on a live or simulcast horse race are pooled and held by the racetrack operator licensee for distribution of the total amount, less the deductions authorized by law, to holders of winning tickets; "pari-mutuel wagering" does not include bookmaking or pool selling;

          [HH.] KK. "person" means a legal entity;

          [II.] LL. "premises" means land, together with all buildings, improvements and personal property located on the land;

          [JJ.] MM. "progressive jackpot" means a prize that increases over time or as gaming machines that are linked to a progressive system are played and upon conditions established by the board may be paid by an annuity;

          [KK.] NN. "public post-secondary educational institution" means an institution designated in Article 12, Section 11 of the constitution of New Mexico or an institution designated in Chapter 21, Article 13, 14 or 16 NMSA 1978;

          [LL.] OO. "progressive system" means one or more gaming machines linked to one or more common progressive jackpots;

          [MM.] PP. "publicly traded corporation" means a corporation that:

                (1) has one or more classes of securities registered pursuant to the securities laws of the United States or New Mexico;

                (2) is an issuer subject to the securities laws of the United States or New Mexico; or

                (3) has one or more classes of securities registered or is an issuer pursuant to applicable foreign laws that, the board finds, provide protection for institutional investors that is comparable to or greater than the stricter of the securities laws of the United States or New Mexico;

          QQ. "race meet" means a period of time within dates specified by the board in which a racetrack operator licensee is authorized to conduct live racing on the racing grounds;

          RR. "racing grounds" means the area of a racetrack operator licensee's premises used for the purpose of conducting horse races and all activities ancillary to the conduct of horse races, including the track, stable area, jockeys' quarters and horse training areas;

          SS. "racing season" means a period of live horse racing conducted on the racing grounds of a racetrack operator licensee and authorized by the board pursuant to the Gaming Control and Horse Racing Act;

          TT. "racetrack gaming operator" means a gaming operator at a racetrack;

          UU. "racetrack operator" means a person who conducts horse races at a horse racetrack;

          [NN.] VV. "registration" means a board action that authorizes a company to be a holding company with respect to a company that holds or applies for a license or that relates to other persons required to be registered pursuant to the Gaming Control and Horse Racing Act;

          WW. "simulcast" means a transmission of a live audiovisual broadcast of a horse race being run at a horse racetrack other than the horse racetrack or other licensed facility at which the broadcast is being received for viewing pursuant to a simulcasting contract;

          [OO.] XX. "subsidiary" means a company, all or a part of whose outstanding equity securities are owned, subject to a power or right of control or held, with power to vote, by a holding company or intermediary company;

          [PP.] YY. "technician" means a person approved by the board to repair and service gaming devices or associated equipment but who is prohibited from programming gaming devices; and

          [QQ.] ZZ. "work permit" means a card, certificate or permit issued by the board, whether denominated as a work permit, registration card or otherwise, authorizing the employment of the holder as a gaming employee."

     SECTION 4. Section 60-2E-4 NMSA 1978 (being Laws 1997, Chapter 190, Section 6) is amended to read:

     "60-2E-4. LIMITED GAMING ACTIVITY AND PARI-MUTUEL WAGERING PERMITTED.--Gaming activity [is] and pari-mutuel wagering are permitted in New Mexico only if it is conducted in compliance with and pursuant to:

          A. the Gaming Control and Horse Racing Act; or

          B. a state or federal law other than the Gaming Control and Horse Racing Act that expressly permits the activity or exempts it from the application of the state criminal law, or both."

     SECTION 5. Section 60-2E-5 NMSA 1978 (being Laws 1997, Chapter 190, Section 7, as amended) is amended to read:

     "60-2E-5. GAMING CONTROL BOARD CREATED.--

          A. The "gaming control board" is created and consists of [five] seven members. [Four] Members are appointed by the governor with the advice and consent of the senate [and one ex-officio member is the chairman of the state racing commission]. All members of the board shall be residents of New Mexico and citizens of the United States. One [appointed] member of the board shall have a minimum of five years of previous employment in a supervisory and administrative position in a law enforcement agency; one [appointed] member of the board shall be a certified public accountant in New Mexico who has had at least five years of experience in public accountancy; one [appointed] member of the board shall be an attorney who has been admitted to practice before the supreme court of New Mexico; three members of the board shall be practical breeders of racehorses within New Mexico; and one [appointed] member of the board shall be a public member who has knowledge and experience in business management and financing.

          B. [The appointed] Members of the board shall be appointed for terms of five years, except, of the members who are first appointed, the member with law enforcement experience shall be appointed for a term of five years; the member who is a certified public accountant shall be appointed for a term of four years; the member who is an attorney shall be appointed for a term of three years; and the public member shall be appointed for a term of two years. When first appointed, one practical breeder member shall be appointed for a term of four years, one practical breeder member shall be appointed for a term of three years; and one practical breeder member shall be appointed for a term of two years. Thereafter, all members shall be appointed for terms of five years. [No] A person shall not serve as a board member for more than two consecutive terms or ten years total.

          C. [No] A full-time board member who receives a salary pursuant to Subsection G of this section [may] shall not be employed in any other capacity [or] and shall not in any manner receive compensation for services rendered to any person or entity other than the board while a member of the board.

          D. A vacancy on the board [of an appointed member] shall be filled within thirty days by the governor with the advice and consent of the senate for the unexpired portion of the term in which the vacancy occurs. A person appointed to fill a vacancy shall meet all qualification requirements of the office established in this section.

          E. The governor shall choose a [chairman] chair annually from the board's appointed full-time, salaried members.

          F. No more than [three] four members of the board shall be from the same political party.

          G. The law enforcement, certified public accountant and attorney members of the board shall be full-time state officials and shall receive a salary set by the governor. The public member and [ex-officio member] practical breeder members of the board shall not receive salaries for their work for the board. All [appointed] members of the board [shall] are entitled to receive per diem and mileage pursuant to the provisions of the Per Diem and Mileage Act.

          H. The department of public safety shall conduct background investigations of all members of the board prior to confirmation by the senate. To assist the department in the background investigation, a prospective board member shall furnish a disclosure statement to the department on a form provided by the department containing that information deemed by the department as necessary for completion of a detailed and thorough background investigation. The required information shall include at least:

                (1) a full set of fingerprints made by a law enforcement agency on forms supplied by the department;

                (2) complete information and details with respect to the prospective board member's antecedents, habits, immediate family, character, criminal record, business activities, financial affairs and business associates covering at least a ten-year period immediately preceding the date of submitting the disclosure statement;

                (3) complete disclosure of [any] an equity interest held by the prospective board member or a member of [his] the prospective board member's immediate family in a company that is an applicant or licensee or an affiliate, affiliated company, intermediary company or holding company in respect to an applicant or licensee; and

                (4) the names and addresses of members of the immediate family of the prospective board member.

           I. [No] A person [may] shall not be appointed or confirmed as a member of the board if that person or member of [his] that person's immediate family holds an equity interest in a company that is an applicant or licensee or an affiliate, affiliated company, intermediary company or holding company in respect to an applicant or licensee.

          J. A prospective board member shall provide assistance and information requested by the department of public safety or the governor and shall cooperate in any inquiry or investigation of the prospective board member's fitness or qualifications to hold the office to which [he] the prospective board member is appointed. The senate shall not confirm a prospective board member if it has reasonable cause to believe that the prospective board member has:

                (1) knowingly misrepresented or omitted a material fact required in a disclosure statement;

                (2) been convicted of a felony, a gaming-related offense or a crime involving fraud, theft or moral turpitude within ten years immediately preceding the date of submitting a disclosure statement required pursuant to the provisions of Subsection H of this section;

                (3) exhibited a history of willful disregard for the gaming laws of this or any other state or the United States; or

                (4) had a permit or license issued pursuant to the gaming laws of this or any other state or the United States permanently suspended or revoked for cause.

          K. At the time of taking office, each board member shall file with the secretary of state a sworn statement that [he] the board member is not disqualified under the provisions of Subsection I of this section."

     SECTION 6. Section 60-2E-6 NMSA 1978 (being Laws 1997, Chapter 190, Section 8) is amended to read:

     "60-2E-6. BOARD--MEETINGS--QUORUM--RECORDS.--

          A. A majority of the qualified membership of the board then in office constitutes a quorum. No action may be taken by the board unless at least [three] four members concur.

          B. Written notice of the time and place of each board meeting shall be given to each member of the board at least ten days prior to the meeting.

          C. Meetings of the board shall be open and public in accordance with the Open Meetings Act, except that the board may close a meeting to hear confidential security and investigative information and other information made confidential by the provisions of the Gaming Control and Horse Racing Act.

          D. All proceedings of the board shall be recorded by audiotape or other equivalent verbatim audio recording device.

          E. The [chairman] chair of the board, the executive director or a majority of the members of the board then in office may call a special meeting of the board upon at least five days' prior written notice to all members of the board and the executive director."

     SECTION 7. Section 60-2E-7 NMSA 1978 (being Laws 1997, Chapter 190, Section 9, as amended) is amended to read:

     "60-2E-7. BOARD'S POWERS AND DUTIES.--

          A. The board shall implement the state's policy on gaming, pari-mutuel wagering and horse racing consistent with the provisions of the Gaming Control and Horse Racing Act and the New Mexico Bingo and Raffle Act. It has the duty to fulfill all responsibilities assigned to it pursuant to those acts, and it has all authority necessary to carry out those responsibilities. It may delegate authority to the executive director, but it retains accountability. The board is an adjunct agency.

          B. The board shall:

                (1) employ the executive director;

                (2) make the final decision on issuance, denial, suspension and revocation of all licenses pursuant to and consistent with the provisions of the Gaming Control and Horse Racing Act and the New Mexico Bingo and Raffle Act;

                (3) develop, adopt and promulgate all [regulations] rules necessary to implement and administer the provisions of the Gaming Control and Horse Racing Act and the New Mexico Bingo and Raffle Act;

                (4) conduct itself, or employ a hearing officer to conduct, all hearings required by the provisions of the Gaming Control and Horse Racing Act and other hearings it deems appropriate to fulfill its responsibilities;

                (5) meet at least once each month; [and]

                (6) prepare and submit an annual report in December of each year to the governor and the legislature, covering activities of the board in the most recently completed fiscal year, a summary of gaming activities, pari-mutuel wagering and horse racing in the state and any recommended changes in or additions to the laws relating to gaming and horse racing in the state;

                (7) require background investigations of gaming or horse racing employees and exclude or compel the exclusion from any gaming establishment or horse racetrack in the state a person whose behavior is found to be detrimental to the best interests of gaming or horse racing, as defined by the board, or a person who willfully violates the gaming or horse racing laws or rules of this state or another state;

                (8) personally or by agents or representatives, supervise and verify the making of pari-mutuel wagering pools and the distributions from those pools;

                (9) adopt rules governing, restricting or regulating bids on leases at racetracks;

                (10) make rules to hold, conduct and operate all horse races held in the state and to identify and assign racing dates;

                (11) approve all improvements proposed to be completed on the licensed premises of a horse racetrack, including extensions, additions or improvements of buildings, stables or tracks;

                (12) approve contracts for simulcasting, pari-mutuel wagering and capital improvements funded pursuant to Section 60-2E-47 NMSA 1978 entered into by horse racetracks; and

                (13) supervise and control the pari-mutuel machines and equipment at all horse races held or operated by the state, its agencies or commissions.

          C. The board may:

                (1) impose civil fines not to exceed twenty-

five thousand dollars ($25,000) for the first violation of any prohibitory provision of the Gaming Control and Horse Racing Act or any prohibitory provision of a regulation adopted pursuant to that act and fifty thousand dollars ($50,000) for subsequent violations;

                (2) conduct investigations;

                (3) subpoena persons and documents to compel access to or the production of documents and records, including books and memoranda, in the custody or control of a licensee;

                (4) compel the appearance of employees of a licensee or persons for the purpose of ascertaining compliance with provisions of the Gaming Control and Horse Racing Act or a [regulation] rule adopted pursuant to its provisions;

                (5) administer oaths and take depositions to the same extent and subject to the same limitations as would apply if the deposition were pursuant to discovery rules in a civil action in the district court;

                (6) sue and be sued subject to the limitations of the Tort Claims Act;

                (7) contract for the provision of goods and services necessary to carry out its responsibilities;

                (8) conduct audits, relevant to their pari-mutuel wagering or gaming activities, of applicants, licensees and persons affiliated with licensees;

                (9) inspect, examine, photocopy and audit all documents and records of an applicant or licensee relevant to the applicant's or licensee's gaming activities or pari-mutuel wagering in the presence of the applicant or licensee or the applicant's or licensee's agent;

                (10) require verification of income and all other matters pertinent to the gaming activities or pari-mutuel wagering of an applicant or licensee affecting the enforcement of any provision of the Gaming Control and Horse Racing Act;

                (11) inspect all places where gaming activities, pari-mutuel wagering or horse racing are conducted and inspect all property connected with gaming, pari-mutuel wagering or horse racing in those places;

                (12) summarily seize, remove and impound from places inspected any gaming [devices] machines, property connected with gaming or pari-mutuel wagering, documents or records for the purpose of examination or inspection;

                (13) inspect, examine, photocopy and audit documents and records, relevant to the affiliate's gaming activities or pari-mutuel wagering, of an affiliate of an applicant or licensee that the board knows or reasonably suspects is involved in the financing, operation or management of the applicant or licensee. The inspection, examination, photocopying and audit shall be in the presence of a representative of the affiliate or its agent when practicable; and

                [(14) conduct background investigations pursuant to the Horse Racing Act; and

                (15)] (14) except for the powers specified in Paragraphs (1) and (4) of this subsection, carry out all or part of the foregoing powers and activities through the executive director.

          D. The board shall monitor all activity authorized in an Indian gaming compact between the state and an Indian nation, tribe or pueblo. The board shall appoint the state gaming representative for the purposes of the compact."

     SECTION 8. Section 60-2E-8 NMSA 1978 (being Laws 1997, Chapter 190, Section 10, as amended) is amended to read:

     "60-2E-8. BOARD [REGULATIONS] RULES--DISCRETIONARY [REGULATIONS] RULES--PROCEDURE--REQUIRED PROVISIONS.--

          A. The board may adopt any [regulation] rule that:

                (1) is consistent with the provisions of the Gaming Control and Horse Racing Act; and

                (2) it decides is necessary to implement the provisions of the Gaming Control and Horse Racing Act.

          B. No [regulation] rule shall be adopted, amended or repealed without a public hearing on the proposed action before the board or a hearing officer designated by it. Notice of the subject matter of the [regulation] rule, the action proposed to be taken, the time and place of the hearing, the manner in which interested persons may present their views and the method by which copies of the proposed [regulation] rule, amendment or repeal may be obtained shall be published once at least thirty days prior to the hearing date in a newspaper of general circulation and mailed at least thirty days prior to the hearing date to all persons who have made a written request for advance notice of hearing. All [regulations] rules and actions taken on [regulations] rules shall be filed in accordance with the State Rules Act.

          C. The board shall adopt [regulations] rules:

                (1) prescribing the method and form of application to be followed by an applicant;

                (2) prescribing the information to be furnished by an applicant or licensee concerning the applicant's or licensee's antecedents, immediate family, habits, character, associates, criminal record, business activities and financial affairs, past or present;

                (3) prescribing the manner and procedure of all hearings conducted by the board or a hearing officer;

                (4) prescribing the manner and method of collection and payment of fees;

                (5) prescribing the manner and method of the issuance of licenses, permits, registrations, certificates and other actions of the board not elsewhere prescribed in the Gaming Control and Horse Racing Act;

                (6) defining the area, games and gaming devices allowed and the methods of operation of the games and gaming devices for authorized gaming;

                (7) prescribing under what conditions the nonpayment of winnings is grounds for suspension or revocation of a license of a gaming operator;

                (8) governing the manufacture, sale, distribution, repair and servicing of gaming devices;

                (9) prescribing accounting procedures, security, collection and verification procedures required of licensees and matters regarding financial responsibility of licensees;

                (10) prescribing what shall be considered to be an unsuitable method of operating gaming activities, horse racing or pari-mutuel wagering;

                (11) restricting access to confidential information obtained pursuant to the provisions of the Gaming Control and Horse Racing Act and ensuring that the confidentiality of that information is maintained and protected;

                (12) prescribing financial reporting and internal control requirements for licensees;

                (13) prescribing the manner in which winnings, compensation from gaming activities and pari-mutuel wagering and net take shall be computed and reported by a [gaming operator] licensee;

                (14) prescribing the frequency of and the matters to be contained in audits of and periodic financial reports relevant to [the gaming operator] a licensee's gaming activities [from a gaming operator licensee] or pari-mutuel wagering consistent with standards prescribed by the board;

                (15) prescribing the procedures to be followed by a [gaming operator] licensee for the exclusion of persons from gaming establishments or horse racetracks;

                (16) establishing criteria and conditions for the operation of progressive systems;

                (17) establishing criteria and conditions for approval of procurement by the board of personal property valued in excess of twenty thousand dollars ($20,000), including background investigation requirements for a person submitting a bid or proposal;

                (18) establishing an applicant fee schedule for processing applications that is based on costs of the application review incurred by the board whether directly or through payment by the board for costs charged for investigations of applicants by state departments and agencies other than the board, which [regulation] rule shall set a maximum fee of one hundred thousand dollars ($100,000); [and]

                (19) governing pari-mutuel wagering, horse racing and interstate common pool wagering; and

                [(19)] (20) establishing criteria and conditions for allowing temporary possession of gaming devices:

                     (a) by post-secondary educational institutions;

                     (b) for trade shows;

                     (c) for film or theater productions; or

                     (d) for other non-gaming purposes."

     SECTION 9. Section 60-2E-10 NMSA 1978 (being Laws 1997, Chapter 190, Section 12, as amended) is amended to read:

     "60-2E-10. EXECUTIVE DIRECTOR--POWERS--DUTIES.--

          A. The executive director shall implement the policies of the board.

          B. The executive director shall employ all personnel who work for the board. The employees shall be covered employees pursuant to the provisions of the Personnel Act. Among those personnel, [he] the executive director shall employ and designate an appropriate number of individuals as law enforcement officers subject to proper certification pursuant to the Law Enforcement Training Act. Law enforcement officers shall not carry firearms on racing grounds, except as provided in the rules adopted by the board.

          C. The executive director shall establish organizational units [he] that the executive director determines are appropriate to administer the provisions of the Gaming Control and Horse Racing Act.

          D. The executive director:

                (1) may delegate authority to subordinates as [he] the executive director deems necessary and appropriate, clearly delineating the delegated authority and the limitations on it, if any;

                (2) shall take administrative action by issuing orders and instructions consistent with the Gaming Control and Horse Racing Act and [regulations] rules of the board to [assure] ensure implementation of and compliance with the provisions of that act and those [regulations] rules;

                (3) may issue administrative citations to [any] a licensee upon a reasonable belief that the licensee has violated or is violating any provision of the Gaming Control and Horse Racing Act or [regulations] rules of the board;

                (4) may conduct research and studies that will improve the operations of the board and the provision of services to the citizens of the state;

                (5) may provide courses of instruction and practical training for employees of the board and other persons involved in the activities regulated by the board with the objectives of improving operations of the board and achieving compliance with the law and [regulations] rules;

                (6) shall prepare an annual budget for the board and submit it to the board for approval; and

                (7) shall make recommendations to the board of proposed [regulations] rules and any legislative changes needed to provide better administration of the Gaming Control and Horse Racing Act and fair and efficient regulation of gaming activities, pari-mutuel wagering and horse racing in the state."

     SECTION 10. Section 60-2E-11 NMSA 1978 (being Laws 1997, Chapter 190, Section 13, as amended) is amended to read:

     "60-2E-11. INVESTIGATION OF EXECUTIVE DIRECTOR CANDIDATES AND EMPLOYEES.--

          A. A person who is under consideration in the final selection process for appointment as the executive director shall file a disclosure statement pursuant to the requirements of this section, and the board shall not make an appointment of a person as executive director until a background investigation is completed by the department of public safety and a report is made to the board.

          B. A person who has reached the final selection process for employment by the executive director shall file a disclosure statement pursuant to the requirements of this section if the executive director or the board has directed the person do so. The person shall not be further considered for employment until a background investigation is completed by the board's law enforcement officers and a report is made to the executive director.

          C. Forms for the disclosure statements required by this section shall be developed by the board in cooperation with the department of public safety. At least the following information shall be required of a person submitting a statement:

                (1) a full set of fingerprints made by a law enforcement agency on forms supplied by the board;

                (2) complete information and details with respect to the person's antecedents, habits, immediate family, character, criminal record, business activities and business associates, covering at least a ten-year period immediately preceding the date of submitting the disclosure statement; and

                (3) a complete description of any equity interest held in a business connected with the gaming or horse racing industry.

          D. In preparing an investigative report, the board's law enforcement officers may request and receive criminal history information from the federal bureau of investigation or any other law enforcement agency or organization. The board's law enforcement officers shall maintain confidentiality regarding information received from a law enforcement agency that may be imposed by the agency as a condition for providing the information to the department of public safety, except that the board's law enforcement officers may provide criminal history information and reports to licensees or tribal gaming casinos when conducting background checks on behalf of the licensee or tribal gaming casino.

          E. A person required to file a disclosure statement shall provide any assistance or information requested by the department of public safety or the board and shall cooperate in any inquiry or investigation.

          F. If information required to be included in a disclosure statement changes or if information is added after the statement is filed, the person required to file it shall provide that information in writing to the person requesting the investigation. The supplemental information shall be provided within thirty days after the change or addition.

          G. The board shall not appoint a person as executive director, and the executive director shall not employ a person, if the board or the executive director has reasonable cause to believe that the person has:

                (1) knowingly misrepresented or omitted a material fact required in a disclosure statement;

                (2) been convicted of a felony, a gaming- or horse racing-related offense or a crime involving fraud, theft or moral turpitude within ten years immediately preceding the date of submitting a disclosure statement required pursuant to this section;

                (3) exhibited a history of willful disregard for the gaming or horse racing laws of this or any other state or the United States; or

                (4) had a permit or license issued pursuant to the gaming or horse racing laws of this or any other state or the United States permanently suspended or revoked for cause.

           H. Both the board and the executive director may exercise absolute discretion in exercising their respective appointing and employing powers."

     SECTION 11. Section 60-2E-12 NMSA 1978 (being Laws 1997, Chapter 190, Section 14, as amended) is amended to read:

     "60-2E-12. CONFLICTS OF INTEREST--BOARD--EXECUTIVE DIRECTOR--EMPLOYEES.--

          A. In addition to all other provisions of New Mexico law regarding conflicts of interest of state officials and employees, a member of the board, the executive director, an employee of the board or a person in the immediate family of or residing in the household of any of the foregoing persons, shall not:

                (1) directly or indirectly, as a proprietor or as a member, stockholder, director or officer of a company, have an interest in a business engaged in gaming activities, pari-mutuel wagering or horse racing in this or another jurisdiction; or

                (2) accept or agree to accept any economic opportunity, gift, loan, gratuity, special discount, favor, hospitality or service having an aggregate value of one hundred dollars ($100) or more in any calendar year from a licensee or applicant.

          B. If a member of the board, the executive director or a person in the immediate family of or residing in the household of a member of the board or the executive director violates a provision of this section, the member of the board or executive director shall be removed from office. A board member shall be removed by the governor, and the executive director shall be removed from the executive director's position by the board."

     SECTION 12. Section 60-2E-13 NMSA 1978 (being Laws 1997, Chapter 190, Section 15, as amended) is amended to read:

     "60-2E-13. GAMING ACTIVITIES REQUIRING LICENSING.--

          A. A person shall not conduct gaming unless the person is licensed as a gaming operator.

          B. A person shall not sell, supply or distribute a gaming device or associated equipment for use or play in this state or for use or play outside of this state from a location within this state unless the person is licensed as a distributor or manufacturer, but a gaming operator licensee may sell or trade in a gaming device or associated equipment to a gaming operator licensee, distributor licensee or manufacturer licensee.

          C. Except as provided in Subsection D of this section, a person shall not manufacture, fabricate, assemble, program or make modifications to a gaming device or associated equipment for use or play in this state or for use or play outside of this state from any location within this state unless the person is a manufacturer licensee. A manufacturer licensee may sell, supply or distribute only the gaming devices or associated equipment that the manufacturer licensee manufactures, fabricates, assembles, programs or modifies.

          D. Upon receiving a written request from a person who manufactures associated equipment, the board may waive the requirement for a manufacturer's license on the terms and conditions the board deems necessary as long as the waiver is consistent with the purpose of the Gaming Control and Horse Racing Act.

          E. Except as provided in Section 60-2E-13.1 NMSA 1978, a gaming operator licensee or a person other than a manufacturer licensee or distributor licensee shall not possess an unlicensed or illegal gaming device or possess or control a place where there is an unlicensed or illegal gaming device. Any unlicensed or illegal gaming device, except a gaming machine in the possession of a licensee while awaiting transfer to a gaming operator licensee for licensure of the machine, or as provided in Section 60-2E-13.1 NMSA 1978, is subject to seizure and forfeiture pursuant to Section 30-19-10 NMSA 1978.

          F. A person shall not service or repair a gaming device or associated equipment unless the person is licensed as a manufacturer, is employed by a manufacturer licensee or is a technician approved by the board and employed by a distributor licensee or a gaming operator licensee.

           G. A person shall not engage in an activity for which the board requires a license or permit without obtaining the license or permit.

          H. Except as provided in Subsections B and D of this section, a person shall not purchase, lease or acquire possession of a gaming device or associated equipment except from a distributor licensee or manufacturer licensee.

          I. A distributor licensee may receive a percentage of the amount wagered, the net take or other measure related to the operation of a gaming machine as a payment pursuant to a lease or other arrangement for furnishing a gaming machine, but the board shall adopt a [regulation] rule setting the maximum allowable percentage."

     SECTION 13. Section 60-2E-13.1 NMSA 1978 (being Laws 2002, Chapter 102, Section 9, as amended) is amended to read:

     "60-2E-13.1. TEMPORARY POSSESSION OF GAMING DEVICE FOR LIMITED PURPOSE.--

          A. A public post-secondary educational institution may temporarily possess gaming devices for the limited purpose of providing instruction on the technical aspects of gaming devices to persons seeking certification as technicians qualified to repair and maintain gaming devices. A gaming device allowed for such limited use shall be subject to registration, transport, possession and use requirements and restrictions established in board [regulations] rules.

          B. Trade shows and similar events for the purpose of demonstrating and marketing gaming devices may be conducted in the state at the discretion of the board. A gaming device allowed in the state for such limited use shall be subject to registration, transport, possession and use requirements and restrictions established in board [regulations] rules.

          C. A person may possess an unlicensed gaming device used by the person for the purposes of testing or demonstration if that person is a manufacturer licensee or has obtained a waiver pursuant to the Gaming Control and Horse Racing Act.

          D. A person may possess a gaming device for the purpose of film or theater productions or other non-gaming purposes permitted by [regulation] rule of the board. Any gaming device allowed in the state for such limited use shall be subject to registration, transport, possession and use requirements and restrictions established in board [regulations] rules."

     SECTION 14. Section 60-2E-14 NMSA 1978 (being Laws 1997, Chapter 190, Section 16, as amended) is amended to read:

     "60-2E-14. LICENSURE--APPLICATION.--

          A. The board shall establish and issue the following categories of licenses:

                (1) manufacturer;

                (2) distributor;

                (3) gaming operator; [and]

                (4) gaming machine;

                (5) racetrack operator; and

                (6) racetrack gaming operator.

          B. The board shall issue certifications of findings of suitability for key executives and other persons for whom certification is required. The board may issue one certification of finding of suitability for a key executive or other person found suitable for employment in both gaming and horse racing operations.

          C. The board shall issue work permits for gaming employees. The board may issue one permit to allow a gaming employee to work in both gaming and horse racing operations.

          D. A licensee shall not be issued more than one type of license, but this provision does not prohibit a licensee from owning, leasing, acquiring or having in the licensee's possession licensed gaming machines if that activity is otherwise allowed by the provisions of the Gaming Control and Horse Racing Act. A licensee shall not own a majority interest in, manage or otherwise control a holder of another type of license issued pursuant to the provisions of that act.

          E. An applicant for a license, a certification of finding of suitability or a work permit shall apply on forms provided by the board and shall furnish to the board two sets of fingerprint cards and all other information requested by the board. Submission of an application constitutes consent to a national criminal background check of the applicant, a credit check of the applicant and all persons having a substantial interest in the applicant and any other background investigations required pursuant to the Gaming Control and Horse Racing Act or deemed necessary by the board. The board may obtain from the taxation and revenue department copies of tax returns filed by or on behalf of the applicant or its affiliates and information concerning liens imposed on the applicant or its affiliates by the taxation and revenue department.

          F. Unless otherwise stated in the Gaming Control and Horse Racing Act, all licenses issued by the board pursuant to the provisions of this section shall be reviewed for renewal annually unless revoked, suspended, canceled or terminated.

          G. A license shall not be transferred or assigned.

          H. The application for a license shall include:

                (1) the name of the applicant;

                (2) the location of the proposed operation;

                (3) if for a gaming operator license or a racetrack gaming operator license, the gaming devices to be operated, manufactured, distributed or serviced;

                (4) if for a racetrack operator license, the dates and days of the week of the race meet that the applicant is requesting the board to approve;

                [(4)] (5) the names of all persons having a direct or indirect interest in the business of the applicant and the nature of such interest; and

                [(5)] (6) such other information and details as the board may require.

          I. The board shall furnish to the applicant supplemental forms that the applicant shall complete and file with the application. The supplemental forms shall require two sets of fingerprint cards and complete information and details with respect to the applicant's antecedents, habits, immediate family, character, state and federal criminal records, business activities, financial affairs and business associates, covering at least a ten-year period immediately preceding the date of filing of the application.

          J. In conducting a background investigation and preparing an investigative report on the applicant, the board's law enforcement officers may request and receive criminal history information from the federal bureau of investigation or any other law enforcement agency or organization. The board's law enforcement officers shall maintain confidentiality regarding information received from a law enforcement agency that may be imposed by the agency as a condition for providing the information to the board."

     SECTION 15. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] CLASSIFICATION OF RACETRACK GAMING OPERATOR LICENSES.--

          A. A gaming operator licensee authorized to conduct pari-mutuel wagering on live horse races on the racing grounds of a racetrack operator licensee and on simulcast horse races received on the racetrack operator licensee's premises shall be issued either a class A or class B racetrack gaming operator license pursuant to the following:

                (1) a class A license shall be issued to a racetrack gaming operator licensee for a horse racetrack at which the total gross amount wagered through the pari-mutuel system in the preceding calendar year from live horse races and simulcast races was ten million dollars ($10,000,000) or more; and

                (2) a class B license shall be issued to a racetrack gaming operator licensee for a horse racetrack at which the total gross amount wagered through the pari-mutuel system in the preceding calendar year from live horse races and simulcast races was less than ten million dollars ($10,000,000).

          B. A new racetrack gaming operator licensee shall be given a classification by the board based on the best estimate of the projected total gross amount to be wagered at the new horse racetrack through the pari-mutuel system from live horse races and simulcast races.

          C. Each class of license is subject to the provisions of the Gaming Control and Horse Racing Act, except as explicitly stated in that act.

          D. The board shall adopt rules as necessary to provide for racetrack gaming operator license classification."

     SECTION 16. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] RACETRACK OPERATOR LICENSES--APPLICATIONS--SPECIFIC REQUIREMENTS.--

          A. A racetrack operator license shall be valid for a period not to exceed one year. The board may renew a racetrack operator license upon expiration of the term of the license.

          B. Renewal applications for racetrack operator licenses shall be filed no later than June 1 of each year. The race dates for the upcoming year shall be set by the board after the board receives all renewal applications.

          C. An application shall specify the dates and days of the week of the race meet that the applicant is requesting the board to approve.

          D. An application shall be filed not less than sixty days prior to the first day the proposed horse race or race meet is to be held.

          E. The board may schedule a date for a hearing on the application for a new racetrack operator license to determine the eligibility of the applicant pursuant to the Gaming Control and Horse Racing Act or as needed for determining the eligibility for the renewal of a racetrack operator license. The applicant shall be notified of the hearing at least five days prior to the date of the hearing. The applicant has the right to present testimony in support of the application. Notice shall be mailed to the address of the applicant appearing upon the application for the racetrack operator license. Notice of the hearing date, time and location shall be postmarked by United States mail five days prior to the date of the hearing. Deposit of the hearing notice in the United States mail constitutes notice.

          F. If, after a hearing on the application, the board finds the applicant ineligible pursuant to the provisions of the Gaming Control and Horse Racing Act or rules adopted by the board, the racetrack operator license shall be denied.

          G. If there is more than one application for a racetrack operator license pending at the same time, the board shall determine the racing days that will be allotted to each successful applicant. Upon renewal, the board shall determine the racing days that will be allotted to each applicant upon terms and conditions established by the board.

          H. A person shall not have a direct, indirect or beneficial interest of any nature, whether or not financial, administrative, policymaking or supervisory, in more than two horse racetracks in New Mexico. For purposes of this subsection, a person shall not be considered to have a direct, indirect or beneficial interest in a horse racetrack if the person owns or holds less than ten percent of the total authorized, issued and outstanding shares of a corporation that is licensed to conduct a race meet in New Mexico, unless the person has some other direct, indirect or beneficial interest of any nature, whether or not financial, administrative, policymaking or supervisory, in more than two licensed horse racetracks.

          I. To determine interest held in a racetrack, to the extent that the interest is based on stock ownership:

                (1) stock owned, directly or indirectly, by or for a corporation, partnership, estate or trust shall be considered as being owned proportionately by its shareholders, partners or beneficiaries;

                (2) an individual shall be considered as owning the stock, directly or indirectly, if it is held by an immediate family member. For purposes of this paragraph, "immediate family member" includes only the individual's siblings, spouse or children; and

                (3) stock constructively owned by a person by reason of the application of Paragraph (1) of this subsection shall be considered to be actually owned by the person; and stock shall be constructively owned by an individual by reason of the application of Paragraph (2) of this subsection if the purpose of the constructive ownership is to make a person other than the individual applicant appear as the owner of the stock.

          J. A corporation holding a racetrack operator license shall not issue to a person shares of its stock amounting to ten percent or more of the total authorized, issued and outstanding shares, and a corporation holding a racetrack license shall not issue shares of its stock that would, when combined with that stock transferee's existing shares owned, total more than ten percent of the total authorized, issued and outstanding shares of the corporation, unless:

                (1) the corporation gives written notice to the board at least sixty days before the contemplated stock transfer that the person to whom the stock is being transferred will become an owner of ten percent or more of the total authorized, issued and outstanding shares of the corporation; and

                (2) the corporation receives written approval from the board of the proposed transfer.

          K. A determination made by the board of a matter pursuant to this section shall be final and not subject to appeal."

     SECTION 17. Section 60-2E-15 NMSA 1978 (being Laws 1997, Chapter 190, Section 17) is amended to read:

     "60-2E-15. LICENSE, CERTIFICATION AND WORK PERMIT FEES.--

          A. License and other fees shall be established by board [regulation] rule but shall not exceed the following amounts:

                (1) manufacturer's license, twenty thousand dollars ($20,000) for the initial license and five thousand dollars ($5,000) for annual renewal;

                (2) distributor's license, ten thousand dollars ($10,000) for the initial license and one thousand dollars ($1,000) for annual renewal;

                (3) [gaming operator's license for a] racetrack gaming operator's license, fifty thousand dollars ($50,000) for the initial license and ten thousand dollars ($10,000) for annual renewal;

                (4) gaming operator's license for a nonprofit organization, one thousand dollars ($1,000) for the initial license and two hundred dollars ($200) for annual renewal;

                (5) for each separate gaming machine licensed to a person holding an operator's license, five hundred dollars ($500) for the initial license and one hundred dollars ($100) for annual renewal; [and]

                (6) work permit, one hundred dollars ($100) annually; and

                (7) racetrack operator license, five thousand dollars ($5,000) for the initial license and one thousand dollars ($1,000) for annual renewal.

          B. The board shall establish the fee for certifications or other actions by [regulation] rule, but no fee established by the board shall exceed one thousand dollars ($1,000), except for fees established pursuant to Paragraph (18) of Subsection C of Section [10 of the Gaming Control Act] 60-2E-8 NMSA 1978.

          C. All license, certification or work permit fees shall be paid to the board at the time and in the manner established by [regulations] rules of the board."

     SECTION 18. Section 60-2E-16 NMSA 1978 (being Laws 1997, Chapter 190, Section 18, as amended) is amended to read:

     "60-2E-16. ACTION BY BOARD ON APPLICATIONS.--

          A. A person that the board determines is qualified to receive a license pursuant to the provisions of the Gaming Control and Horse Racing Act may be issued a license. The burden of proving qualifications is on the applicant.

          B. A license shall not be issued unless the board is satisfied that the applicant is:

                (1) a person of good moral character, honesty and integrity;

                (2) a person whose prior activities, state and federal criminal records, reputation, habits and associations do not pose a threat to the public interest or to the effective regulation and control of gaming, pari-mutuel wagering or horse racing or create or enhance the dangers of unsuitable, unfair or illegal practices, methods and activities in the conduct of gaming, pari-mutuel wagering or horse racing or the carrying on of the business and financial arrangements incidental thereto; and

                (3) in all other respects qualified to be licensed consistent with the laws of this state.

          C. A license shall not be issued unless the applicant has satisfied the board that:

                (1) the applicant has adequate business probity, competence and experience in business and gaming, pari-mutuel wagering or horse racing;

                (2) the proposed financing of the applicant is adequate for the nature of the proposed license and from a suitable source; any lender or other source of money or credit that the board finds does not meet the standards set forth in Subsection B of this section shall be deemed unsuitable; and

                (3) the applicant is sufficiently capitalized under standards set by the board to conduct the business covered by the license.

          D. An application to receive a license, certification or work permit constitutes a request for a determination of the applicant's general moral character, integrity and ability to participate or engage in or be associated with gaming, pari-mutuel wagering or horse racing. Any written or oral statement made in the course of an official proceeding of the board or by a witness testifying under oath that is relevant to the purpose of the proceeding is absolutely privileged and does not impose liability for defamation or constitute a ground for recovery in any civil action.

          E. The board shall not issue a license or certification to an applicant who has previously been denied a license or certification in this state or another state, who has had a certification, permit or license issued pursuant to the gaming, pari-mutuel wagering or horse racing laws of a state or the United States permanently suspended or revoked for cause or who is currently under suspension or subject to any other limiting action in this state or another state involving gaming activities, pari-mutuel wagering or horse racing or licensure for gaming activities, pari-mutuel wagering or horse racing, unless the violation that is the basis of the denial, permanent suspension or other limiting action regarding a license, certification or permit applied for or issued in this state or another state is determined by the board to be a technical violation, and, if the board finds the violation to be a technical violation, the board may choose to issue a license or certification.

          F. The board shall investigate the qualifications of each applicant before a license, certification or work permit is issued by the board and shall continue to observe and monitor the conduct of all licensees, work permit holders, persons certified as being suitable and the persons having a material involvement directly or indirectly with a licensee.

          G. The board has the authority to deny an application or limit, condition, restrict, revoke or suspend a license, certification or permit for any cause.

          H. After issuance, a license, certification or permit shall continue in effect upon proper payment of the initial and renewal fees, subject to the power of the board to revoke, suspend, condition or limit licenses, certifications and permits.

          I. The board has full and absolute power and authority to deny an application for any cause it deems reasonable. If an application is denied, the board shall prepare and file its written decision on which its order denying the application is based."

     SECTION 19. Section 60-2E-19 NMSA 1978 (being Laws 1997, Chapter 190, Section 21, as amended) is amended to read:

     "60-2E-19. COMPANY APPLICANTS--NONPROFIT ORGANIZATION APPLICANTS--REQUIRED INFORMATION.--

          A. A company applicant for a license or a renewal of a license shall provide the following information to the board on forms provided by the board:

                (1) the organization, financial structure and nature of the business to be operated, including the names and personal histories of all officers, directors and key executives;

                (2) the rights and privileges acquired by the holders of different classes of authorized securities;

                (3) the terms and conditions of all outstanding loans, mortgages, trust deeds, pledges or any other indebtedness or security interest evidenced by a security instrument pertaining to the proposed gaming, pari-mutuel wagering or horse racing operation or other licensed activity in this state and the name and address of the person who is servicing the loan, mortgage, trust deed, pledge or other indebtedness or security interest;

                (4) remuneration to persons, other than directors, officers and key executives, exceeding one hundred thousand dollars ($100,000) per year;

                (5) bonus and profit-sharing arrangements within the company;

                (6) a list of management and service contracts pertaining to the proposed gaming activity, pari-mutuel wagering or horse racing in this state;

                (7) balance sheets and profit and loss statements for at least the three preceding fiscal years, or, if the company has not been in business for a period of three years, balance sheets and profit and loss statements from the time of its commencement of business operations and projected for three years from the time of its commencement of business operations. All balance sheets and profit and loss statements shall be audited by independent certified public accountants; and

                (8) any further financial data that the board deems necessary or appropriate.

          B. A nonprofit organization applying for a license or a renewal of a license as a nonprofit gaming operator pursuant to the Gaming Control and Horse Racing Act shall provide in its application:

                (1) the organization, financial structure and nature of the nonprofit organization, including the names of all officers, directors and key executives;

                (2) the terms and conditions of all outstanding loans, mortgages, trust deeds, pledges or any other indebtedness or security interest evidenced by a security instrument pertaining to the proposed gaming, pari-mutuel wagering or horse racing operation or other licensed activity in this state and the name and address of the person who is servicing the loan, mortgage, trust deed, pledge or other indebtedness or security interest;

                (3) management and service contracts pertaining to the proposed gaming activity or pari-mutuel wagering or horse racing operation in this state;

                (4) balance and profit and loss statements for at least the three preceding fiscal years or, if the nonprofit organization has not been in business for a period of three years, balance sheets and profit and loss statements from the date of charter or incorporation and projected for three years from the date of charter or incorporation. All balance sheets and profit and loss statements shall be submitted in a manner prescribed by the board;

                (5) any further financial data that the board deems necessary or appropriate;

                (6) if the nonprofit organization has various classes of members, information detailing the rights and privileges attributed to each class of member and providing the number of members in each class;

                (7) the level of remuneration for all paid employees of the nonprofit organization; and

                (8) details about any other form of remuneration or awards that are conferred on members."

     SECTION 20. Section 60-2E-20 NMSA 1978 (being Laws 1997, Chapter 190, Section 22, as amended) is amended to read:

     "60-2E-20. INDIVIDUAL CERTIFICATION OF FINDING OF SUITABILITY OF OFFICERS, DIRECTORS AND OTHER PERSONS.--

          A. An officer, director, equity security holder of five percent or more, partner, general partner, limited partner, trustee or beneficiary of the company that holds or has applied for a license shall individually apply for and obtain a certification of finding of suitability, according to the provisions of the Gaming Control and Horse Racing Act, and if, in the judgment of the board the public interest is served by requiring any or all of the company's key executives to apply for and obtain a certification of finding of suitability, the company shall require those persons to apply for certification. A person who is required to be certified pursuant to this subsection shall apply for certification within thirty days after becoming an officer, director, equity security holder of five percent or more, partner, general partner, limited partner of five percent or more, trustee, beneficiary or key executive. A person who is required to be certified pursuant to a decision of the board shall apply for certification within thirty days after the board so requests. A person required or requested to be certified pursuant to this subsection shall provide to the board an application for certification, including a personal history, a financial statement, copies of the person's income tax returns for the three years immediately prior to the year of the application and other information that the board deems necessary or appropriate.

          B. The key executives of a nonprofit organization that holds or has applied for a license shall individually apply for and obtain a certification of finding of suitability. For purposes of this subsection, key executives are those officers, employees, volunteers and other persons who are designated by the nonprofit organization as key executives. The board may require additional officers, employees, volunteers and other persons to apply for and obtain a certification of finding of suitability if the board determines the public interest is served by the additional certifications. A person who is required to be certified pursuant to this subsection shall apply for certification within thirty days after becoming an officer or key executive. A person who is required to be certified pursuant to a decision of the board shall apply for certification within thirty days after the board so requests. A person required or requested to be certified pursuant to this subsection shall provide to the board an application for certification, including a personal history, a financial statement, copies of the person's income tax returns for the three years immediately prior to the year of the application and other information that the board deems necessary or appropriate."

     SECTION 21. Section 60-2E-22 NMSA 1978 (being Laws 1997, Chapter 190, Section 24, as amended) is amended to read:

     "60-2E-22. CHANGE IN COMPANY OWNERSHIP.--

          A. If a company applicant or company licensee proposes to transfer ownership of twenty percent or more of the applicant or licensee, it shall notify the board in writing and provide the following information about the successor company:

                (1) if the company is a publicly traded corporation, as of the date the company became a publicly traded corporation, and on any later date when the information changes, the names of all stockholders of record who hold five percent or more of the outstanding shares of any class of equity securities issued by the publicly traded corporation;

                (2) the names of all officers within thirty days of their respective appointments;

                (3) the names of all directors within thirty days of their respective elections or appointments;

                (4) the organization, financial structure and nature of the businesses the company operates;

                (5) if the company is a publicly traded corporation, the terms, position, rights and privileges of the different classes of securities outstanding as of the date the company became a publicly traded corporation;

                (6) if the company is a publicly traded corporation, the terms on which the company's securities were issued during the three years preceding the date on which the company became a publicly traded corporation and the terms on which the publicly traded corporation's securities are to be offered to the public as of the date the company became a publicly traded corporation;

                (7) the terms and conditions of all outstanding indebtedness and evidence of security pertaining directly or indirectly to the company;

                (8) remuneration exceeding one hundred thousand dollars ($100,000) per year paid to persons other than directors, officers and key executives who are actively and directly engaged in the administration or supervision of the gaming activities or pari-mutuel wagering or horse racing operations of the company;

                (9) bonus and profit-sharing arrangements within the company directly or indirectly relating to its gaming activities or pari-mutuel wagering or horse racing operations;

                (10) management and service contracts of the company pertaining to its gaming activities or pari-mutuel wagering or horse racing operations;

                (11) options existing or to be created pursuant to its equity securities;

                (12) balance sheets and profit and loss statements, certified by independent certified public accountants or their foreign equivalents, for not less than the three fiscal years preceding the date of the proposed transfer of ownership;

                (13) any further financial statements deemed necessary or appropriate by the board; and

                (14) a description of the company's affiliated companies and intermediary companies and gaming licenses, permits and approvals held by those entities.

          B. The board shall determine whether the proposed transaction is a transfer or assignment of the license as prohibited by Subsection G of Section 60-2E-14 NMSA 1978. If the board determines that the proposed transaction is prohibited, it shall notify the licensee in writing and shall require the proposed transferee to file an application for a license. If the board determines that the proposed transaction is not a prohibited transfer or assignment of the license, it shall make a determination as to whether to issue a certification approving the transaction. The board shall consider the following information about the successor company in determining whether to certify the transaction:

                (1) the business history of the company, including its record of financial stability, integrity and success of its gaming operations or pari-mutuel wagering or horse racing operations in other jurisdictions;

                (2) the current business activities and interests of the company, as well as those of its officers, promoters, lenders and other sources of financing, or any other persons associated with it;

                (3) the current financial structure of the company as well as changes that could reasonably be expected to occur to its financial structure as a consequence of its proposed action;

                (4) the present and proposed compensation arrangements between the company and its directors, officers, key executives, securities holders, lenders or other sources of financing;

                (5) the equity investment, commitment or contribution of present or prospective directors, key executives, investors, lenders or other sources of financing; and

                (6) the dealings and arrangements, prospective or otherwise, between the company and its investment bankers, promoters, finders or lenders and other sources of financing.

          C. The board may issue a certification upon receipt of a proper application and consideration of the criteria set forth in Subsection B of this section if it finds that the certification would not be contrary to the public interest or the policy set forth in the Gaming Control and Horse Racing Act.

          D. The board shall require the officers, directors, key executives and holders of an equity security interest of five percent or more of the successor company and any other person specified in the Gaming Control and Horse Racing Act to apply for and obtain a certification of finding of suitability."

     SECTION 22. Section 60-2E-27 NMSA 1978 (being Laws 1997, Chapter 190, Section 29, as amended) is amended to read:

     "60-2E-27. RACETRACK GAMING OPERATOR LICENSEES--SPECIAL CONDITIONS FOR RACETRACKS--NUMBER OF GAMING MACHINES--DAYS AND HOURS OF OPERATIONS.--

          A. [A] The board may issue a racetrack gaming operator's license to a horse racetrack [licensed by the state racing commission pursuant to the Horse Racing Act] to conduct live horse races or simulcast races [may be issued a gaming operator's license] and to operate gaming machines on its premises where live racing is conducted; provided that the racetrack is in compliance with the requirements of the Gaming Control and Horse Racing Act and the board.

          B. A [racetrack's] racetrack gaming operator's license shall automatically become void if:

                (1) the racetrack no longer holds an active license to conduct pari-mutuel wagering; or

                (2) the racetrack fails to maintain a minimum of four live race days a week with at least nine live races on each race day during its licensed race meet, except as provided in Subsection F of this section.

          C. Unless a larger number is allowed pursuant to Subsection D of this section, a racetrack gaming operator licensee [that is a racetrack] may have up to six hundred licensed gaming machines.

          D. By execution of an allocation agreement, signed by both the allocating racetrack and the racetrack to which the allocation is made, a racetrack gaming operator licensee [that is a racetrack] may allocate any number of its authorized gaming machines to another racetrack gaming operator licensee [that is a racetrack]. To be valid, the allocation agreement must bear the written approval of the board [and the state racing commission], and this approval shall make specific reference to the [meeting] meetings at which the action of approval was taken and the number of votes cast both for and against the approval. By allocating a number of its authorized machines to another racetrack, the allocating racetrack automatically surrenders all rights to operate the number of machines allocated. No racetrack shall operate or be authorized to operate more than seven hundred fifty gaming machines.

          E. Gaming machines on a racetrack gaming operator licensee's premises may be played only on days when the racetrack is either conducting live horse races or simulcasting horse race meets. On days when gaming machines are permitted to be operated, a racetrack gaming operator licensee may offer gaming machines for operation for up to eighteen hours per day; provided that the total number of hours in which gaming machines are operated does not exceed one hundred twelve hours in a one-week period beginning on Tuesday at 8:00 a.m. and ending at 8:00 a.m. on the following Tuesday. A racetrack gaming operator licensee may offer gaming machines for play at any time during a day; provided that the total hours of operation in each day from just after midnight of the previous day until midnight of the current day does not exceed eighteen hours. A racetrack gaming operator licensee shall determine, within the limitations imposed by this subsection, the hours it will offer gaming machines for operation each day and shall notify the board in writing of those hours.

          F. Maintaining fewer than four live race days or nine live races on each race day during a licensed race meet does not constitute a failure to maintain the minimum number of live race days or races as required by Paragraph (2) of Subsection B of this section if the [licensee submits to the board written approval by the state racing commission for the licensee to vary the minimum number of live race days or races, and the] variance is due to:

                (1) the inability of a racetrack gaming operator licensee to fill races as published in the licensee's condition book;

                (2) severe weather or other act, event or occurrence resulting from natural forces;

                (3) a strike or work stoppage by jockeys or other persons necessary to conduct a race or meet;

                (4) a power outage, electrical failure or failure or unavailability of any equipment or supplies necessary to conduct a race or meet;

                (5) hazardous conditions or other threats to the public health or safety; or

                (6) any other act, event or occurrence that the board finds is not within the control of the licensee even with the exercise of reasonable diligence or care.

          G. Alcoholic beverages shall not be sold, served, delivered or consumed in the area restricted pursuant to Subsection F of Section 60-2E-26 NMSA 1978."

     SECTION 23. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] PARI-MUTUEL WAGERING--RACETRACK GAMING OPERATOR LICENSEES--LIMITED TO ENCLOSURE WHERE HORSE RACES ARE CONDUCTED--GAMBLING STATUTES DO NOT APPLY.--

          A. A racetrack gaming operator licensed by the board may conduct pari-mutuel wagering on live horse races or on simulcast horse races.

          B. Pari-mutuel wagering may be conducted only within the enclosure where horse races are conducted on the racing grounds of a racetrack gaming operator licensee.

          C. A racetrack gaming operator licensee may sell pari-mutuel tickets or certificates only for:

                (1) live races being conducted on the racing grounds on the premises of the racetrack gaming operator licensee; or

                (2) simulcast races received on the premises of the racetrack gaming operator licensee.

          D. Pari-mutuel tickets or certificates may be sold only in the racing enclosure on the racing grounds of a racetrack gaming operator licensee or in areas set aside for viewing simulcast races on the premises of the racetrack gaming operator licensee.

          E. The sale to patrons present on the licensed premises of a racetrack operator licensee of pari-mutuel tickets or certificates is not gambling as defined in Section 30-19-2 or 30-19-3 NMSA 1978.

          F. Placing a wager while on the premises of the racetrack gaming operator licensee is not placing a bet pursuant to Section 30-19-1 NMSA 1978.

          G. The licensed premises of a horse racetrack is not a "gambling place" as that term is defined in Section

30-19-1 NMSA 1978."

     SECTION 24. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSE RACE SIMULCASTING ALLOWED--RACETRACK GAMING OPERATOR LICENSEES.--

          A. The board may allow simulcasting of horse races being conducted on the racing grounds of a racetrack gaming operator licensee to other locations within or outside of the state holding a pari-mutuel license or gaming license allowing pari-mutuel wagering.

          B. Simulcasting of horse races licensed and conducted outside of the state may be permitted on the racing grounds of racetrack gaming operator licensees.

          C. A racetrack gaming operator licensee shall not be allowed to simulcast horse races unless that racetrack gaming operator licensee offers at least seventeen days per year of pari-mutuel wagering on live horse races run on the premises of the racetrack gaming operator licensee.

          D. Pari-mutuel wagering on the racing grounds of a racetrack gaming operator licensee on simulcast races is permitted only on days on which live races are conducted on the racing grounds of the licensee or on days when the licensee is receiving simulcast races from another gaming operator licensee facility racetrack in New Mexico.

          E. Pari-mutuel wagering shall be conducted on simulcast races on the premises of a racetrack gaming operator licensee located within an eighty-mile radius of another racetrack gaming operator licensee facility at which live races are in progress only if there is a mutual agreement of the two racetrack gaming operator licensees.

          F. The board shall adopt rules concerning the simulcasting of horse races pursuant to this section."

      SECTION 25. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] INTERSTATE COMMON POOL WAGERING AUTHORIZED--RACETRACK GAMING OPERATOR LICENSEES.--

          A. Subject to the federal Interstate Horse Racing Act of 1978, the board may permit a racetrack gaming operator licensee to participate in interstate common pools. All provisions of the Gaming Control and Horse Racing Act that govern pari-mutuel wagering apply to pari-mutuel wagering in interstate common pools, except as otherwise provided in this section.

          B. Subject to prior approval of the board, the following provisions apply when a racetrack gaming operator licensee participates in interstate common pools on a horse race that originates outside of New Mexico:

                (1) the licensee may combine its pari-mutuel pools with comparable pari-mutuel pools at the host track and other locations. The types of wagering, takeout, distribution of winnings and rules of racing in effect for pari-mutuel pools at the host track shall govern wagers placed at the guest track in this state and merged into the interstate common pool. Breakage for interstate common pools shall be calculated in accordance with the rules governing the host track and shall be distributed in a manner agreed upon by the racetrack gaming operator licensee guest track and the host track;

                (2) with the concurrence of the host track, an interstate common pool that excludes the host track may be formed among the racetrack gaming operator licensee guest track and other locations outside the state where the host track is located. When such an interstate common pool is formed, the board may approve types of wagering takeout, distribution of winnings, rules of racing and calculation of breakage that are different than those that would otherwise be in effect in New Mexico, provided that they are applied consistently to all persons in the interstate common pool;

                (3) the racetrack gaming operator licensee may deduct from retainage resulting from an interstate common pool any reasonable fee paid to the person conducting the horse race for the privilege of conducting pari-mutuel wagering on the race and participating in the common pool; and

                (4) provisions of law or contract governing the distribution of pari-mutuel taxes, breeder or other awards and purses from the takeout of wagers placed in this state shall remain in effect for wagers placed in interstate common pools; provided that:

                     (a) if the board approves an adjustment in the takeout rate, the distribution of the takeout within New Mexico shall be adjusted proportionately to reflect the adjustment in the takeout rate; and

                     (b) with the concurrence of the racetrack gaming operator licensee and the organization representing a majority of the breeders, horsemen or other persons entitled to shares of the distribution and subject to approval of the board, the respective shares to the breeders or other awards or purses may be modified.

          C. Subject to prior approval of the board, the following provisions apply when a racetrack gaming operator licensee participates in interstate common pools on a horse race that originates at the licensee's track:

                (1) a licensee may permit one or more of its horse races to be utilized for pari-mutuel wagering at, and may transmit audio-visual signals of horse races the licensee conducts to, one or more locations outside New Mexico. The racetrack gaming operator licensee may also permit pari-mutuel wagering pools in other locations to be combined with the licensee's comparable pari-mutuel wagering pools or with wagering pools established in other jurisdictions. The board may modify its rules and adopt separate rules for interstate common pools and their calculation of breakage;

                (2) daily pari-mutuel taxes shall not be imposed upon amounts wagered in an interstate common pool other than upon amounts wagered within this state;

                (3) except as otherwise provided in this section, any provisions of law or contract governing the distribution of shares of the takeout as New Mexico pari-mutuel taxes, breeder or other awards and purses shall remain in effect for amounts wagered within this state in interstate common pools; provided that with the concurrence of the racetrack gaming operator licensee and the organization representing a majority of the breeders, horsemen or other persons entitled to shares of the distribution, and subject to approval of the board, the respective shares to breeder or other awards or purses may be modified; and

                (4) with respect to the retainage on interstate common pooling received from a guest state by a racetrack gaming operator licensee, that licensee shall allocate to the New Mexico horse breeders' association five percent of the daily retainage. Of the retainage remaining after the allocation to the New Mexico horse breeders' association, fifty percent shall be allocated to race purses and fifty percent shall be retained by the racetrack gaming operator licensee.

          D. When the laws and rules of the host and guest states permit, an interstate common pool may be established on a regional or other basis between two or more guest states and not include a merger into the host track's pari-mutuel pool, in which case one of the guest tracks shall serve as if it were the host track for the purposes of calculating the pari-mutuel pool. An interstate common pool may include members located outside the United States. Except as otherwise set forth in the board's rules, participation by a person in a common pool with wagering facilities in one or more other guest states shall not cause the participating person to be deemed to be doing business in any state other than the state in which that person is physically located.

          E. The board may adopt rules necessary or appropriate to exercise its powers and duties pursuant to this section.

          F. As used in this section:

                (1) "guest state" means the jurisdiction within which a guest track is located;

                (2) "guest track" means the horse racetrack, off-track wagering facility or other facility in a location other than the state in which the horse race is run that is a member of and subject to an interstate common pool;

                (3) "host state" means the jurisdiction within which a host track is located;

                (4) "host track" means the horse racetrack from which the horse race is run that is transmitted to members of and is subject to an interstate common pool; and

                (5) "interstate common pool" means a pari-mutuel pool that combines comparable pari-mutuel pools of one or more locations accepting wagers on a horse race run at the host track for purposes of establishing payoff prices at the pool members' locations. Pool members from more than one state may simultaneously combine pari-mutuel pools into an interstate common pool."

     SECTION 26. Section 60-2E-29 NMSA 1978 (being Laws 1997, Chapter 190, Section 31, as amended) is amended to read:

     "60-2E-29. LICENSING OF MANUFACTURERS OF GAMING DEVICES--EXCEPTION--DISPOSITION OF GAMING DEVICES.--

          A. It is unlawful for a person to operate, carry on, conduct or maintain any form of manufacturing of a gaming device or associated equipment for use or play in New Mexico or any form of manufacturing of a gaming device or associated equipment in New Mexico for use or play outside of New Mexico without first obtaining and maintaining a manufacturer's license.

          B. If the board revokes a manufacturer's license:

                (1) no new gaming device manufactured by the manufacturer may be approved for use in this state;

                (2) any previously approved gaming device manufactured by the manufacturer is subject to revocation of approval if the reasons for the revocation of the license also apply to that gaming device;

                (3) no new gaming device or associated equipment made by the manufacturer may be distributed, sold, transferred or offered for use or play in New Mexico; and

                (4) any association or agreement between the manufacturer and a distributor licensee or gaming operator licensee in New Mexico shall be terminated.

          C. An agreement between a manufacturer licensee and a distributor licensee or a gaming operator licensee in New Mexico shall be deemed to include a provision for its termination without liability for the termination on the part of either party upon a finding by the board that either party is unsuitable. Failure to include that condition in the agreement is not a defense in an action brought pursuant to this section to terminate the agreement.

          D. A gaming device shall not be used and offered for play by a gaming operator licensee unless it is identical in all material aspects to a model that has been specifically tested and approved by:

                (1) the board;

                (2) a laboratory selected by the board; or

                (3) gaming officials in Nevada or New Jersey for current use.

          E. The board may inspect every gaming device that is manufactured:

                (1) for use in New Mexico; or

                (2) in New Mexico for use outside of New Mexico.

          F. The board may inspect every gaming device that is offered for play within New Mexico by a gaming operator licensee.

          G. The board may inspect all associated equipment that is manufactured and sold for use in New Mexico or manufactured in New Mexico for use outside of New Mexico.

          H. In addition to all other fees and charges imposed pursuant to the Gaming Control and Horse Racing Act, the board may determine, charge and collect from each manufacturer an inspection fee, which shall not exceed the actual cost of inspection and investigation.

          I. The board may prohibit the use of a gaming device by a gaming operator licensee if it finds that the gaming device does not meet the requirements of this section."

     SECTION 27. Section 60-2E-30 NMSA 1978 (being Laws 1997, Chapter 190, Section 32, as amended) is amended to read:

     "60-2E-30. LICENSING OF DISTRIBUTORS OF GAMING DEVICES.--

          A. It is unlawful for [any] a person to operate, carry on, conduct or maintain any form of distribution of [any] a gaming device for use or play in New Mexico or any form of distribution of [any] a gaming device in New Mexico for use or play outside of New Mexico without first obtaining and maintaining a distributor's or manufacturer's license.

          B. If the board revokes a distributor's license:

                (1) no new gaming device distributed by the person may be approved;

                (2) any previously approved gaming device distributed by the distributor is subject to revocation of approval if the reasons for the revocation of the license also apply to that gaming device;

                (3) no new gaming device or associated equipment distributed by the distributor may be distributed, sold, transferred or offered for use or play in New Mexico; and

                (4) [any] an association or agreement between the distributor and a gaming operator licensee shall be terminated. An agreement between a distributor licensee and a gaming operator licensee shall be deemed to include a provision for its termination without liability on the part of either party upon a finding by the board that the other party is unsuitable. Failure to include that condition in the agreement is not a defense in any action brought pursuant to this section to terminate the agreement.

          C. The board may inspect every gaming device that is distributed for use in New Mexico.

          D. In addition to all other fees and charges imposed by the Gaming Control and Horse Racing Act, the board may determine, charge and collect from each distributor an inspection fee, which shall not exceed the actual cost of inspection and investigation."

     SECTION 28. Section 60-2E-31 NMSA 1978 (being Laws 1997, Chapter 190, Section 33) is amended to read:

     "60-2E-31. SUITABILITY OF CERTAIN PERSONS FURNISHING SERVICES OR PROPERTY OR DOING BUSINESS WITH GAMING OPERATORS OR RACETRACK GAMING OPERATORS--TERMINATION OF ASSOCIATION.--

          A. The board may determine the suitability of any person who furnishes services or property to a gaming operator licensee or a racetrack gaming operator under any arrangement pursuant to which the person receives compensation based on earnings, profits or receipts from gaming or pari-mutuel wagering. The board may require the person to comply with the requirements of the Gaming Control and Horse Racing Act and with the [regulations] rules of the board. If the board determines that the person is unsuitable, it may require the arrangement to be terminated.

          B. The board may require a person to apply for a finding of suitability to be associated with a gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee if the person:

                (1) does business on the premises of a gaming establishment or horse racetrack; or

                (2) provides any goods or services to a gaming operator licensee or racetrack gaming operator licensee for compensation that the board finds to be grossly disproportionate to the value of the goods or services.

          C. If the board determines that a person is unsuitable to be associated with a gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee, the association shall be terminated. Any agreement that entitles a business other than gaming, pari-mutuel wagering or horse racing to be conducted on the premises of a gaming establishment or horse racetrack, or entitles a person other than a licensee to conduct business with the [gaming operator] licensee, is subject to termination upon a finding of unsuitability of the person seeking association with a [gaming operator] licensee. Every agreement shall be deemed to include a provision for its termination without liability on the part of the gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee upon a finding by the board of the unsuitability of the person seeking or having an association with the [gaming operator] licensee. Failure to include that condition in the agreement is not a defense in any action brought pursuant to this section to terminate the agreement. If the application is not presented to the board within thirty days following demand or the unsuitable association is not terminated, the board may pursue any remedy or combination of remedies provided in the Gaming Control and Horse Racing Act."

     SECTION 29. Section 60-2E-32 NMSA 1978 (being Laws 1997, Chapter 190, Section 34, as amended) is amended to read:

     "60-2E-32. REASONS FOR INVESTIGATIONS BY BOARD--COMPLAINT BY BOARD--BOARD TO APPOINT HEARING EXAMINER--REVIEW BY BOARD--ORDER OF BOARD.--

          A. The board shall make appropriate investigations to:

                (1) determine whether there has been [any] a violation of the Gaming Control and Horse Racing Act or of [any regulations] rules adopted pursuant to that act;

                (2) determine any facts, conditions, practices or matters that it deems necessary or proper to aid in the enforcement of the Gaming Control and Horse Racing Act or [regulations] rules adopted pursuant to that act;

                (3) aid in adopting [regulations] rules;

                (4) secure information as a basis for recommending legislation relating to the Gaming Control and Horse Racing Act; or

                (5) determine whether a licensee is able to meet its financial obligations, including all financial obligations imposed by the Gaming Control and Horse Racing Act, as they become due.

          B. If after an investigation the board is satisfied that a license, registration, finding of suitability or prior approval by the board of [any] a transaction for which approval was required by the provisions of the Gaming Control and Horse Racing Act should be limited, conditioned, suspended or revoked, or that a fine should be levied, the board shall initiate a hearing by filing a complaint and transmitting a copy of it to the licensee, together with a summary of evidence in its possession bearing on the matter and the transcript of testimony at any investigative hearing conducted by or on behalf of the board. The complaint shall be a written statement of charges that sets forth in ordinary and concise language the acts or omissions with which the respondent is charged. It shall specify the statutes or [regulations] rules that the respondent is alleged to have violated but shall not consist merely of charges raised in the language of the statutes or [regulations] rules. The summary of the evidence shall be confidential and made available only to the respondent until such time as it is offered into evidence at [any] a public hearing on the matter.

          C. The respondent shall file an answer within thirty days after service of the complaint.

          D. Upon filing the complaint, the board shall appoint a hearing examiner to conduct further proceedings.

          E. The hearing examiner shall conduct proceedings in accordance with the Gaming Control and Horse Racing Act and the [regulations] rules adopted by the board. At the conclusion of the proceedings, the hearing examiner may recommend that the board take [any] appropriate action, including revocation, suspension, limitation or conditioning of a license or imposition of a fine not to exceed fifty thousand dollars ($50,000) for each violation or [any] a combination or all of the foregoing actions.

          F. The hearing examiner shall prepare a written decision containing [his] the hearing examiner's recommendation to the board and shall serve it on all parties.

          G. The board shall by a majority vote accept, reject or modify the recommendation.

          H. If the board limits, conditions, suspends or revokes [any] a license or imposes a fine or limits, conditions, suspends or revokes [any] a registration, finding of suitability or prior approval, it shall issue a written order specifying its action.

          I. The board's order is effective on the date issued and continues in effect unless reversed upon judicial review, except that the board may stay its order pending a rehearing or judicial review upon such terms and conditions as it deems proper."

     SECTION 30. Section 60-2E-33 NMSA 1978 (being Laws 1997, Chapter 190, Section 35) is amended to read:

     "60-2E-33. EMERGENCY ORDERS OF BOARD.--The board may issue an emergency order for suspension, limitation or conditioning of a license, registration, finding of suitability or work permit or may issue an emergency order requiring a gaming operator licensee to exclude an individual licensee from the premises of the gaming operator licensee's gaming establishment or the racetrack gaming operator licensee's horse racetrack or not to pay an individual licensee any remuneration for services or any profits, income or accruals on [his] the individual licensee's investment in the [licensed gaming] establishment in the following manner:

          A. an emergency order may be issued only when the board believes that:

                (1) a licensee has willfully failed to report, pay or truthfully account for and pay over any fee imposed by the provisions of the Gaming Control and Horse Racing Act or willfully attempted in any manner to evade or defeat any fee or payment thereof;

                (2) a licensee or gaming employee has cheated at a game; [or]

                (3) a licensee or gaming employee has used pari-mutuel wagering in a manner not authorized by the board, influenced or attempted to influence a horse race or attempted to affect the speed or stamina of a racehorse; or

                [(3)] (4) the emergency order is necessary for the immediate preservation of the public peace, health, safety, morals, good order or general welfare;

          B. the emergency order shall set forth the grounds upon which it is issued, including a statement of facts constituting the alleged emergency necessitating such action;

          C. the emergency order is effective immediately upon issuance and service upon the licensee or resident agent of the licensee or gaming employee or, in cases involving registration or findings of suitability, upon issuance and service upon the person or entity involved or resident agent of the entity involved; the emergency order may suspend, limit, condition or take other action in relation to the license of one or more persons in an operation without affecting other individual licensees or the gaming operator licensee. The emergency order remains effective until further order of the board or final disposition of the case; and

          D. within five days after issuance of an emergency order, the board shall cause a complaint to be filed and served upon the person or entity involved; thereafter, the person or entity against whom the emergency order has been issued and served is entitled to a hearing before the board and to judicial review of the decision and order of the board in accordance with the provisions of the board's [regulations] rules."

     SECTION 31. Section 60-2E-34 NMSA 1978 (being Laws 1997, Chapter 190, Section 36) is amended to read:

     "60-2E-34. EXCLUSION OR EJECTION OF CERTAIN PERSONS FROM GAMING ESTABLISHMENTS AND HORSE RACETRACKS--PERSONS INCLUDED.--

          A. The board shall by [regulation] rule provide for the establishment of a list of persons who are to be excluded or ejected from a gaming establishment or a horse racetrack. The list may include any person whose presence in the gaming establishment or a horse racetrack is determined by the board to pose a threat to the public interest or licensed gaming activities.

          B. In making the determination in Subsection A of this section, the board may consider a:

                (1) prior conviction for a crime that is a felony under state or federal law, a crime involving moral turpitude or a violation of the gaming laws of any jurisdiction;

                (2) violation or conspiracy to violate the provisions of the Gaming Control and Horse Racing Act relating to:

                     (a) the failure to disclose an interest in a gaming activity, pari-mutuel wagering or horse racing for which the person must obtain a license; or

                     (b) willful evasion of fees or taxes;

                (3) notorious or unsavory reputation that would adversely affect public confidence and trust that the gaming or horse racing industry is free from criminal or corruptive influences; or

                (4) written order of any other governmental agency in this state or any other state that authorizes the exclusion or ejection of the person from an establishment at which gaming, pari-mutuel wagering or horse racing is conducted.

          C. A gaming operator licensee has the right, without a list established by the board, to exclude or eject a person from its gaming establishment or horse racetrack who poses a threat to the public interest or for any business reason.

          D. Race, color, creed, national origin or ancestry, age, disability or sex shall not be grounds for placing the name of a person on the list or for exclusion or ejection under Subsection A or C of this section."

     SECTION 32. Section 60-2E-34.1 NMSA 1978 (being Laws 2009, Chapter 199, Section 14) is amended to read:

     "60-2E-34.1. SELF-EXCLUSION FROM GAMING ESTABLISHMENTS AND HORSE RACETRACKS--PROCEDURE--FINES--CONFIDENTIALITY.--

          A. The board shall develop rules that permit a person who is a compulsive gambler to be voluntarily excluded from a gaming establishment or horse racetrack.

          B. Self-exclusion shall occur through written application made by the compulsive gambler to the board and shall be governed by the following provisions:

                (1) self-exclusion shall be enforceable upon issuance of a self-exclusion order by the board to each applicable gaming establishment and horse racetrack identified in the order;

                (2) only the person who is the compulsive gambler may apply on that person's behalf;

                (3) the application shall be submitted to the board;

                (4) except for notification of the gaming establishments or horse racetracks for which the self-exclusion order is effective and for notification for mailing list exclusion pursuant to this section, the application and the

self-exclusion order shall be held confidential by employees of the board and a gaming operator licensee or racetrack gaming operator licensee and its employees and key executives;

                (5) a self-exclusion order may apply to one or more gaming establishments or horse racetracks licensed pursuant to the Gaming Control and Horse Racing Act;

                (6) a self-excluded person, if present at a gaming establishment or horse racetrack from which the person is excluded, shall forfeit the following to that gaming establishment or horse racetrack; provided that all money or other property forfeited shall be used by the gaming establishment or horse racetrack only to supplement the one-fourth percent of the net take of its gaming machines or pari-mutuel wagering to fund or support programs for the treatment and assistance of compulsive gamblers pursuant to Subsection E of Section 60-2E-47 NMSA 1978:

                     (a) all winnings of the person obtained while present at the gaming establishment or horse racetrack; and

                     (b) all credits, tokens or vouchers received by the person while present at the gaming establishment or horse racetrack;

                (7) a gaming establishment or horse racetrack is immune from liability arising out of its efforts to exclude a person identified in a self-exclusion order; and

                (8) a specific term shall be set for each self-exclusion order.

          C. Notice shall be submitted by the board at least monthly to all gaming establishments and horse racetracks listing all persons who are currently self-excluded and ordering the removal of their names from direct mail or electronic advertisement or promotional lists.

          D. The state gaming representative may negotiate an agreement with each tribal casino in the state to allow the state to include tribal casinos in the self-exclusion orders."

     SECTION 33. Section 60-2E-37 NMSA 1978 (being Laws 1997, Chapter 190, Section 39) is amended to read:

     "60-2E-37. AGE REQUIREMENT FOR PATRONS AND GAMING EMPLOYEES.--A person under the age of twenty-one years shall not:

          A. play, be allowed to play, place wagers on or collect winnings from, whether personally or through an agent, any game or pari-mutuel wagering authorized or offered to play pursuant to the Gaming Control and Horse Racing Act; or

          B. be employed as a gaming employee."

     SECTION 34. Section 60-2E-41 NMSA 1978 (being Laws 1997, Chapter 190, Section 43) is amended to read:

     "60-2E-41. COMMUNICATION OR DOCUMENT OF APPLICANT OR LICENSEE ABSOLUTELY CONFIDENTIAL--CONFIDENTIALITY NOT WAIVED--DISCLOSURE OF CONFIDENTIAL INFORMATION PROHIBITED.--

          A. Any communication or document of an applicant or licensee is confidential and does not impose liability for defamation or constitute a ground for recovery in any civil action if it is required by:

                (1) law or the [regulations] rules of the board; or

                (2) a subpoena issued by the board to be made or transmitted to the board.

          B. The confidentiality created pursuant to Subsection A of this section is not waived or lost because the document or communication is disclosed to the board.

          C. Notwithstanding the powers granted to the board by the Gaming Control and Horse Racing Act, the board:

                (1) may release or disclose any confidential information, documents or communications provided by an applicant or licensee only with the prior written consent of the applicant or licensee or pursuant to a lawful court order after timely notice of the proceedings has been given to the applicant or licensee;

                (2) shall maintain all confidential information, documents and communications in a secure place accessible only to members of the board; and

                (3) shall adopt procedures and [regulations] rules to protect the confidentiality of information, documents and communications provided by an applicant or licensee."

     SECTION 35. Section 60-2E-47 NMSA 1978 (being Laws 1997, Chapter 190, Section 49, as amended) is amended to read:

     "60-2E-47. GAMING TAX--IMPOSITION--ADMINISTRATION.--

          A. An excise tax is imposed on the privilege of engaging in gaming activities in the state. This tax shall be known as the "gaming tax".

          B. The gaming tax is an amount equal to ten percent of the gross receipts of manufacturer licensees from the sale, lease or other transfer of gaming devices in or into the state, except receipts of a manufacturer from the sale, lease or other transfer to a licensed distributor for subsequent sale or lease may be excluded from gross receipts; ten percent of the gross receipts of distributor licensees from the sale, lease or other transfer of gaming devices in or into the state; ten percent of the net take of a gaming operator licensee that is a nonprofit organization; and twenty-six percent of the net take of every other gaming operator licensee. For the purposes of this section, "gross receipts" means the total amount of money or the value of other consideration received from selling, leasing or otherwise transferring gaming devices.

          C. The gaming tax imposed on a licensee is in lieu of all state and local gross receipts taxes on that portion of the licensee's gross receipts attributable to gaming activities.

          D. The gaming tax is to be paid on or before the fifteenth day of the month following the month in which the taxable event occurs. The gaming tax shall be administered and collected by the taxation and revenue department in cooperation with the board. The provisions of the Tax Administration Act apply to the collection and administration of the tax.

          E. In addition to the gaming tax, a racetrack gaming operator licensee [that is a racetrack] shall pay twenty percent of its net take to purses to be distributed in accordance with rules adopted by the [state racing commission] board. An amount not to exceed twenty percent of the interest earned on the balance of any fund consisting of money for purses distributed by racetrack gaming operator licensees pursuant to this subsection may be expended for the costs of administering the distributions. A racetrack gaming operator licensee shall spend no less than one-fourth percent of the net take of its gaming machines to fund or support programs for the treatment and assistance of compulsive gamblers.

          F. A nonprofit gaming operator licensee shall distribute at least sixty percent of the balance of its net take, after payment of the gaming tax and any income taxes,

for charitable or educational purposes."

     SECTION 36. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSE RACING--DAILY PARI-MUTUEL EXCISE TAX--IMPOSITION--AMOUNT--DISTRIBUTION.--

          A. A tax that may be cited as the "daily pari-mutuel excise tax" is imposed for the privilege of conducting pari-mutuel wagering on the racing grounds of a racetrack gaming operator licensee.

          B. The daily pari-mutuel excise tax imposed on class A racetrack gaming operator licensees pursuant to this section shall be:

                (1) for each racing day that a class A racetrack gaming operator licensee offers pari-mutuel wagering on live on-track horse races, six hundred fifty dollars ($650); provided, however, that a class A racetrack gaming operator licensee shall deduct from the six hundred fifty dollars ($650) and remit to the municipality in which the licensee is located one hundred fifty dollars ($150) if the licensee is located in a municipality having a population according to the most recent federal decennial census of:

                     (a) less than six thousand located in a county with a population of more than ten thousand but less than fifteen thousand; or

                     (b) more than eight thousand but less than ten thousand located in a county with a population of more than one hundred thousand but less than one hundred fifty thousand; and

                (2) for each day a class A racetrack gaming operator licensee offers no pari-mutuel wagering on live on-track horse races and offers solely pari-mutuel wagering on simulcast races pursuant to the Gaming Control and Horse Racing Act, one-eighth percent of the licensee's gross daily handle, not to exceed three hundred dollars ($300) per racing day.

          C. The daily pari-mutuel excise tax imposed on a class B racetrack gaming operator licensee pursuant to this section shall be:

                (1) for each racing day a class B racetrack gaming operator licensee offers pari-mutuel wagering on live on-track horse races, one-eighth percent of the licensee's gross daily handle, not to exceed three hundred dollars ($300) per racing day; and

                (2) for each day a class B racetrack gaming operator licensee offers no pari-mutuel wagering on live on-track horse races and offers solely pari-mutuel wagering on simulcast races pursuant to the Gaming Control and Horse Racing Act, one-eighth percent of the licensee's gross daily handle, not to exceed three hundred dollars ($300) per racing day.

          D. The daily pari-mutuel excise tax for a licensed state fair association designated by law that in good faith conducts a public fair and exhibition of stock and farming products shall be six hundred fifty dollars ($650) per day for each racing day authorized; provided, however, that where a state fair association offers no pari-mutuel wagering on live races on the racing grounds of its premises and offers pari-mutuel wagering solely on simulcast races, the daily pari-mutuel excise tax shall be one-eighth percent of the racetrack gaming operator licensee's gross amount wagered each day, up to a maximum of three hundred dollars ($300)."

     SECTION 37. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] DAILY RACING TAX--IMPOSITION--RACETRACK GAMING OPERATOR LICENSEES--AMOUNT--PROHIBITION OF CERTAIN OTHER TAXES.--

          A. In addition to the daily pari-mutuel excise tax imposed pursuant to Section 36 of this 2011 act, but in lieu of the gross receipts tax imposed pursuant to the Gross Receipts and Compensating Tax Act on receipts of a racetrack gaming operator licensee from the gross amount wagered each day, a tax that may be referred to as the "daily racing tax" is imposed in an amount of two and three-sixteenths percent of the gross amount wagered each day on horse races on the premises of a racetrack gaming operator licensee. The tax shall be paid from the commissions on pari-mutuel wagering of the racetrack gaming operator licensee. The tax shall be paid on the gross amount wagered each day from live racing on the racing grounds of the racetrack gaming operator licensee or on simulcast races on the premises of the racetrack gaming operator licensee.

          B. A deduction or offset from the daily racing tax due and owed by a racetrack gaming operator licensee may be taken on forms provided by the taxation and revenue department by the racetrack gaming operator licensee of not more than one-half of the annual daily racing tax due and owed for the first two hundred fifty thousand dollars ($250,000) of the gross amount wagered each day for a taxable year, as follows:

                (1) a class A racetrack gaming operator licensee may deduct the amount that the licensee expends for capital improvements or in financing capital improvements at existing racetrack facilities; and

                (2) a class B racetrack gaming operator licensee may deduct:

                     (a) the amount that the licensee expends for capital improvements, not to exceed fifty percent of the offset amount allowed pursuant to this subsection; and

                     (b) the amount that the licensee expends for advertising, marketing and promoting horse racing in the state, not to exceed fifty percent of the offset allowed pursuant to this subsection.

          C. The balance of revenue derived from the daily racing tax of a racetrack gaming operator licensee that remains after the deduction allowed pursuant to Subsection B of this section shall be remitted to the racing suspense account for transfer to the taxation and revenue department for distribution to eligible municipalities pursuant to Section

38 of this 2011 act.

          D. Regarding the horse racetrack located on the fairgrounds of the state fair, an amount equal to one-half of the daily racing tax imposed pursuant to Subsection A of this section is appropriated from the general fund in fiscal year 2011 and in subsequent fiscal years to the state fair commission for expenditure as needed on capital improvements at the state fairgrounds and expenditure for debt service on negotiable bonds issued for the capital improvements. The unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund.

          E. Revenues from the daily racing tax not otherwise appropriated by provisions of this section shall be deposited to the credit of the general fund.

          F. Accurate records shall be kept by a racetrack gaming operator licensee to show all commissions, total amounts wagered, retainage, distributions and breakage and other information requested by the board. Records shall be open to inspection and shall be audited by the board or its authorized representatives. A racetrack gaming operator licensee is required to maintain records for pari-mutuel wagering and all other financial transactions of the horse racetrack according to generally accepted accounting principles, pursuant to requirements established by the board.

          G. Notwithstanding any other provision of law, a political subdivision of the state shall not impose an occupational or excise tax on a racetrack operating pursuant to the provisions of the Gaming Control and Horse Racing Act. A political subdivision may impose local option gross receipts taxes on businesses within the political subdivision's jurisdiction to the extent authorized and permitted by law.

          H. As used in this section, "capital improvement" means a capital investment in infrastructure that is subject to depreciation pursuant to the federal Internal Revenue Code of 1986 and is approved by the board."

     SECTION 38. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSE RACING--DETERMINATION OF MUNICIPAL COMPENSATION.--

          A. No later than August 31 of each year, the taxation and revenue department shall determine the total amount of local option gross receipts taxes paid in the previous fiscal year by a racetrack gaming operator licensee to the municipality in which the racetrack gaming operator licensee is located that is subject to distribution pursuant to Section 7-1-6.12 NMSA 1978 to the municipality in which the premises of the racetrack gaming operator licensee is located.

          B. If the total distribution pursuant to Section 7-1-6.12 NMSA 1978 to a municipality from the racetrack gaming operator licensee is:

                (1) less than fifty thousand dollars ($50,000), then the taxation and revenue department shall distribute the difference between fifty thousand dollars ($50,000) and the amount of local option gross receipts taxes distributed to the municipality from payments of local option gross receipts taxes made by the racetrack gaming operator licensee in the last fiscal year from the revenue remitted in daily racing taxes pursuant to Section 37 of this 2011 act; or

                (2) equal to or exceeds fifty thousand dollars ($50,000), then no amount of daily racing taxes from that licensee shall be distributed to the municipality.

          C. The taxation and revenue department shall update the board periodically of its progress in calculating the distributions and notify the board when the distributions are complete.

          D. The taxation and revenue department shall inform the board of the amount of daily racing tax distributed pursuant to this section to municipalities from each racetrack gaming operator licensee no later than August 31 of each year.

          E. Balances of daily racing tax remaining after distribution to municipalities shall be deposited to the credit of the general fund."

     SECTION 39. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] DAILY RACE LICENSE FEE--IMPOSITION--AMOUNT--RACETRACK OPERATOR LICENSEE.--In addition to all other daily racing taxes, a daily race license fee of five hundred dollars ($500) is imposed on a racetrack operator licensee for each day of live racing conducted on the racing grounds of the licensee."

     SECTION 40. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] PAYMENT OF DAILY RACING FEES AND TAXES.--

          A. Daily race license fees, daily pari-mutuel excise taxes and daily racing taxes imposed by the Gaming Control and Horse Racing Act shall be paid to the board for deposit in the racing suspense account at the close of the business day on Thursday of every week.

          B. Failure to make weekly remittances by the licensee shall result in an assessment by the board against the licensee of a fine of one percent of the amount due weekly.

          C. Fines shall be distributed from the racing suspense account to the current school fund pursuant to Article 12, Section 4 of the constitution of New Mexico."

     SECTION 41. Section 60-2E-39 NMSA 1978 (being Laws 1997, Chapter 190, Section 41) is amended to read:

     "60-2E-39. LIMITATIONS ON TAXES AND LICENSE FEES.--A political subdivision of the state shall not impose a license fee or tax on any licensee licensed pursuant to the Gaming Control and Horse Racing Act except for the imposition of property taxes, local option gross receipts taxes with respect to receipts not subject to the gaming tax [and the distribution provided for and determined pursuant to Subsection C of Section 60-1-15 and Section 60-1-15.2 NMSA 1978], the daily pari-mutuel excise tax and the daily racing tax."

     SECTION 42. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] RACING SUSPENSE ACCOUNT CREATED.--

          A. The "racing suspense account" is created in the tax administration suspense fund, into which the board shall deposit all daily racing taxes, the daily pari-mutuel excise taxes and all fees.

          B. The taxation and revenue department shall administer the racing suspense account.

          C. A mandatory balance of three thousand dollars ($3,000) shall be maintained in the racing suspense account after transfers are made to the tax administration suspense fund pursuant to this section.

          D. Money in the account above the mandatory balance shall be transferred by the end of business each Friday to the tax administration suspense fund for distribution pursuant to the Tax Administration Act and deposit in the general fund.

          E. All money in the racing suspense account shall be identified as to the source of the money. 

          F. The board shall obtain information about the deposits, distributions and daily balances in the racing suspense account on a monthly basis and upon request of the board to the taxation and revenue department."

     SECTION 43. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSEMEN'S COMMISSIONS--MAXIMUM--COMMISSION DISTRIBUTION--COMMISSION FEE.--

          A. A class A racetrack gaming operator licensee shall be paid a commission of nineteen percent of the gross amount wagered on win, place and show through the pari-mutuel system, of which eighteen and three-fourths percent shall be retained by the licensee. A fee in the amount of one-fourth percent on the commission retained by the class A racetrack gaming operator licensee shall be remitted to the racing suspense account for deposit in the general fund.

          B. A class B racetrack gaming operator licensee shall be paid a commission in an amount determined by the class B racetrack gaming operator licensee of not less than eighteen and three-fourths percent and not greater than twenty-five percent of the gross amount wagered on win, place and show through the pari-mutuel system. The commission shall be retained by a class B racetrack gaming operator licensee. Each class B racetrack gaming operator licensee shall advise the board not less than thirty days prior to the first day of each horse racing season of the percentage of commission that the licensee will retain.

          C. From the commissions, each racetrack gaming operator licensee shall allocate five-eighths percent to the New Mexico horse breeders' association weekly for distribution pursuant to the provisions of Section 59 of this 2011 act.

          D. In regard to exotic wagers:

                (1) a class A racetrack gaming operator licensee shall retain a commission of not less than twenty-one percent and not more than twenty-five percent of the gross amount wagered in exotic wagers;

                (2) a class B racetrack gaming operator licensee shall elect, with the approval of the board, to retain a commission of not less than twenty-one percent and not greater than thirty percent of the gross amount wagered in exotic wagers;

                (3) each racetrack gaming operator licensee shall advise the board not less than thirty days prior to the first day of a racing season of the amount of commission to be retained by the licensee from the gross amount wagered in exotic wagers; and

                (4) a racetrack gaming operator licensee shall allocate one and three-eighths percent to the New Mexico horse breeders' association weekly of redistribution pursuant to the provisions of Section 59 of this 2011 act.

          E. The odd cents of all redistributions to the wagerer over the next lowest multiple of ten from the gross amount wagered through the pari-mutuel system shall be retained by the racetrack gaming operator licensee, with fifty percent of the total of the odd cents wagered being allocated to enhance the race purses of established stake races that include only horses registered as New Mexico bred with the New Mexico horse breeders' association, to be distributed by the New Mexico horse breeders' association pursuant to Section 59 of this 2011 act and subject to the approval of the board.

          F. Money resulting from the failure of patrons who purchased winning pari-mutuel tickets during a horse race season to redeem their winning tickets before the end of the sixty-day period immediately following the closing day of the horse racing season and money resulting from the failure of patrons who purchased pari-mutuel tickets that were entitled to refund but were not refunded during the same sixty-day period shall be apportioned as follows:

                (1) the racetrack gaming operator licensee shall retain thirty-three and thirty-three hundredths percent;

                (2) the New Mexico horse breeders' association shall receive a distribution of thirty-three and thirty-four hundredths percent to enhance each horse racetrack's established overnight purses for races that include only horses registered as New Mexico bred with the New Mexico horse breeders' association, subject to board approval, pursuant to Section 59 of this 2011 act; and

                (3) thirty-three and thirty-three hundredths percent shall be allocated to horsemen's race purses.

          G. To promote and improve the quality of horse racing and simulcasting and the participation of interested persons in horse racing in New Mexico, one-half percent of the gross amount wagered on simulcast horse races at each licensed racetrack in New Mexico that receives simulcast horse races shall be allocated by each racetrack gaming operator licensee for distribution to the New Mexico horsemen's association; provided that at least one-fourth percent of the gross amount wagered on simulcast races that is allocated to the New Mexico horsemen's association is used solely for medical benefits for the members of the New Mexico horsemen's association; and provided further that the remaining one-fourth percent of the gross amount wagered on simulcast races that is allocated to the New Mexico horsemen's association shall be used to enhance purses at each licensed racetrack.

          H. The board shall by rule provide for the timing and manner of the distributions required by this section and shall audit, or arrange for an independent audit of, the disbursements required by this section.

          I. Fifty percent of the net retainage of each licensee shall be allocated to race purses. For purposes of this section, "net retainage" of the licensee means the commission retained by the licensee on all forms of wagers minus:

                (1) the daily taxes imposed on racetrack gaming operator licensees pursuant to the Gaming Control and Horse Racing Act;

                (2) money allocated to the New Mexico horse breeders' association by this section and Section 59 of this 2011 act;

                (3) money allocated to the New Mexico horsemen's association by this section;

                (4) a deduction for expenses incurred to engage in intrastate simulcasting pursuant to Section 25 of this 2011 act; provided that:

                     (a) the deduction for each racetrack gaming operator licensee shall be a portion of five percent of the gross amount wagered at all the sites receiving the same simulcast horse races;

                     (b) the deduction portion for each racetrack gaming operator licensee shall be an amount allocated to that licensee by agreement voluntarily reached among all of the horse racetracks sending or receiving the same simulcast horse races; and

                     (c) the deduction portion for each racetrack gaming operator licensee shall be an amount allocated to that licensee by the board if all of the racetrack gaming operator licensees sending or receiving the same simulcast horse races fail to reach a voluntary agreement pursuant to Section 60-2E-27.3 NMSA 1978; and

                (5) a deduction for fees and commissions incurred to receive interstate simulcasts pursuant to the Gaming Control and Horse Racing Act.

          J. As used in this section, "exotic wager" means a wager made on other than win, place or show through the pari-mutuel system."

     SECTION 44. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] ILLEGAL USE OF PARI-MUTUEL WAGERING.--

          A. A person shall not use pari-mutuel wagering except as permitted by the board pursuant to the Gaming Control and Horse Racing Act or pursuant to other state law providing licensing of persons to use pari-mutuel wagering.

          B. A person who, directly or indirectly, uses pari-mutuel wagering in a manner that is not authorized by the board or other state law is guilty of a fourth degree felony and upon conviction shall be sentenced pursuant to Section 31-18-15 NMSA 1978."

     SECTION 45. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] PREDETERMINING HORSE RACES--INFLUENCING OR ATTEMPTING TO INFLUENCE--FOURTH DEGREE FELONY.--

          A. A person shall not influence or attempt to influence the outcome of a horse race by offering money, a thing of value, a future benefit, a favor, preferred treatment or a form of pressure or threat.

          B. A person shall not enter into an agreement with an owner, jockey, groom or any other person associated with or having an interest in a racehorse to predetermine the outcome of a horse race.

          C. A person who influences or attempts to influence the outcome of a horse race or a person who enters into an agreement to predetermine the outcome of a horse race is guilty of a fourth degree felony and upon conviction shall be sentenced pursuant to Section 31-18-15 NMSA 1978."

     SECTION 46. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] AFFECTING SPEED OR STAMINA OF A RACEHORSE--PENALTIES.--

          A. A person administering, attempting to administer or conspiring with others to administer to a racehorse a drug, chemical, stimulant or depressant or other foreign substance not naturally occurring in a racehorse, whether internally, externally or by injection, for the purpose of stimulating or depressing the racehorse or affecting the speed or stamina of the racehorse during a horse race or workout is guilty of a fourth degree felony and upon conviction shall be sentenced pursuant to Section 31-18-15 NMSA 1978.

          B. A person who uses, attempts to use or conspires with others to use during a horse race or workout an electrically or mechanically prohibited device, implement or instrument, other than an ordinary whip, is guilty of a fourth degree felony and upon conviction shall be sentenced pursuant to Section 31-18-15 NMSA 1978.

          C. A person who sponges the nostrils or trachea of a racehorse or who uses anything to injure a racehorse for the purpose of stimulating or depressing the racehorse or affecting the speed or stamina of the racehorse during a horse race or workout is guilty of a fourth degree felony and upon conviction shall be sentenced pursuant to Section 31-18-15 NMSA 1978.

          D. It is prima facie evidence of intent to commit any of the crimes set forth:

                (1) in Subsection A of this section for a person to be found within the racing grounds of a racetrack licensee, including the stands, stables, sheds or other areas where racehorses are kept, who possesses with the intent to use, sell, give away or otherwise transfer to another person a drug, chemical, stimulant or depressant or other foreign substance not naturally occurring in a racehorse to stimulate or depress a racehorse or to affect the speed or stamina of a racehorse;

                (2) in Subsection B of this section for a person to be found within the racing grounds of a racetrack operator licensee, including the stands, stables, sheds or other areas where racehorses are kept, who possesses with the intent to use, sell, give away or otherwise transfer to another person an electrically or mechanically prohibited device, implement or instrument, other than an ordinary whip; and

                (3) in Subsection C of this section for a person to be found within the racing grounds of a racetrack operator licensee, including the stands, stables, sheds or other areas where racehorses are kept, who possesses with the intent to use, sell, give away or otherwise transfer to another person paraphernalia or substances used to sponge the nostrils or trachea of a racehorse or that may be used to injure a racehorse for the purpose of stimulating or depressing the racehorse or affecting its speed or stamina during a horse race or workout."

     SECTION 47. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSE RACING--UNLAWFUL ACTS.--Prohibitions against horse racing, bookmaking, pool selling or other methods of wagering on horse races are not repealed. Pari-mutuel wagering on horse races that are conducted on the premises of a racetrack gaming operator licensee is the only authorized method of wagering on horse races permitted in the state."

     SECTION 48. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] PENALTY.--If a person, directly or indirectly, uses a pari-mutuel system of wagering except when licensed as a racetrack gaming operator licensee by the board and pursuant to the provisions of the Gaming Control and Horse Racing Act, the person is guilty of a misdemeanor and upon conviction shall be fined an amount not to exceed five thousand dollars ($5,000) or sentenced to imprisonment for not more than ninety days or sentenced with both a fine and imprisonment. An officer of a corporation or company violating a provision of the Gaming Control and Horse Racing Act pertaining to horse racing shall be deemed personally responsible and subject to the penalties imposed pursuant to this section."

     SECTION 49. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSE RACING--STEWARDS--POWERS--DUTIES.--There shall be three stewards, licensed and employed by the board, to supervise each horse race meet. One of the stewards shall be designated the presiding official steward of the race meet. Stewards, other than the presiding official steward, shall be employed subject to the approval of the racetrack operator licensee. All stewards shall be licensed or certified by a nationally recognized horse racing organization. Stewards shall exercise those powers and duties prescribed by board rules. A decision or action of a steward may be reviewed or reconsidered by the board."

     SECTION 50. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] OFFICIAL CHEMIST--QUALIFICATIONS--DUTIES.--The board shall designate at least one official chemist. An official chemist shall hold a doctorate degree in chemistry or a related field and shall be knowledgeable and experienced in the techniques used for testing the blood, urine and saliva of horses for drugs, chemicals, stimulants, depressants or other foreign substances not naturally occurring in a horse. The official chemist may be an employee of a private laboratory located in New Mexico or an employee of an agency of New Mexico. The official chemist shall exercise the duties prescribed by rules of the board."

     SECTION 51. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] HORSE RACING--TESTING SPECIMENS.--

          A. The board shall adopt rules applying to the handling and testing of urine and other specimens identified by the board to be taken from racehorses.

          B. Each specimen taken from a racehorse shall be divided into two or more samples, and:

                (1) one sample shall be tested by the board or its designated laboratory in order to detect the presence of unauthorized drugs, chemicals, stimulants, depressants or other foreign substances not naturally occurring in a horse; and

                (2) the second sample shall be forwarded by the board to the scientific laboratory division of the department of health.

          C. After an inconclusive or positive test result on the sample tested by the board or its designated laboratory and upon a written request from the president, executive director or manager of the New Mexico horsemen's association on forms designated by the board, the scientific laboratory division shall transmit the corresponding second sample to the New Mexico horsemen's association.

          D. The scientific laboratory division shall keep all samples in a controlled environment for a period of at least three months.

          E. The board shall contract with an independent laboratory to maintain a quality assurance program."

     SECTION 52. Section 60-2E-48 NMSA 1978 (being Laws 1997, Chapter 190, Section 50) is amended to read:

     "60-2E-48. CIVIL ACTIONS TO RESTRAIN VIOLATIONS OF GAMING CONTROL AND HORSE RACING ACT.--

          A. The attorney general, at the request of the board, may institute a civil action in any court of this state against any person to enjoin a violation of a prohibitory provision of the Gaming Control and Horse Racing Act.

          B. An action brought against a person pursuant to this section shall not preclude a criminal action or administrative proceeding against that person."

     SECTION 53. Section 60-2E-49 NMSA 1978 (being Laws 1997, Chapter 190, Section 51) is amended to read:

     "60-2E-49. TESTIMONIAL IMMUNITY.--

          A. The board may order a person to answer a question or produce evidence and confer immunity pursuant to this section. If, in the course of an investigation or hearing conducted pursuant to the Gaming Control and Horse Racing Act, a person refuses to answer a question or produce evidence on the ground that [he] the person will be exposed to criminal prosecution by doing so, then the board may by approval of [three] four members, after the written approval of the attorney general, issue an order to answer or to produce evidence with immunity.

          B. If a person complies with an order issued pursuant to Subsection A of this section, [he] the person shall be immune from having a responsive answer given or responsive evidence produced, or evidence derived from either, used to expose [him] the person to criminal prosecution, except that the person may be prosecuted for [any] perjury committed in the answer or production of evidence and may also be prosecuted for contempt for failing to act in accordance with the order of the board. An answer given or evidence produced pursuant to the grant of immunity authorized by this section may be used against the person granted immunity in a prosecution of the person for perjury or a proceeding against [him] the person for contempt."

     SECTION 54. Section 60-2E-51 NMSA 1978 (being Laws 1997, Chapter 190, Section 53) is amended to read:

     "60-2E-51. CRIME--USE OF COUNTERFEIT OR UNAPPROVED TOKENS, CURRENCY OR DEVICES--POSSESSION OF CERTAIN DEVICES, EQUIPMENT, PRODUCTS OR MATERIALS.--

          A. A person who, in playing [any] a game designed to be played with, to receive or to be operated by tokens approved by the board or by lawful currency of the United States, knowingly uses tokens other than those approved by the board, uses currency that is not lawful currency of the United States or uses currency not of the same denomination as the currency intended to be used in that game is guilty of a third degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978.

          B. A person who knowingly has on [his] the person's person or in [his] the person's possession within a gaming establishment any device intended to be used by [him] the person to violate the provisions of the Gaming Control and Horse Racing Act is guilty of a third degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978.

          C. A person, other than a duly authorized employee of a gaming operator acting in furtherance of [his] the employee's employment within a gaming establishment, who knowingly has on [his] the person's person or in [his] the person's possession within a gaming establishment [any] a key or device known by [him] the person to have been designed for the purpose of and suitable for opening, entering or affecting the operation of [any] a game, dropbox or [any] an electronic or mechanical device connected to the game or dropbox or for removing money or other contents from them is guilty of a third degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978.

          D. A person who knowingly and with intent to use them for cheating has on [his] the person's person or in [his] the person's possession [any] paraphernalia for manufacturing slugs is guilty of a third degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978. As used in this subsection, "paraphernalia for manufacturing slugs" means the equipment, products and materials that are intended for use or designed for use in manufacturing, producing, fabricating, preparing, testing, analyzing, packaging, storing or concealing a counterfeit facsimile of tokens approved by the board or a lawful coin of the United States, the use of which is unlawful pursuant to the Gaming Control and Horse Racing Act. The term includes:

                (1) lead or lead alloy;

                (2) molds, forms or similar equipment capable of producing a likeness of a gaming token or coin;

                (3) melting pots or other receptacles;

                (4) torches; and

                (5) tongs, trimming tools or other similar equipment.

          E. Possession of more than two items of the equipment, products or material described in Subsection D of this section permits a rebuttable inference that the possessor intended to use them for cheating."

     SECTION 55. Section 60-2E-54 NMSA 1978 (being Laws 1997, Chapter 190, Section 56) is amended to read:

     "60-2E-54. CRIME--REPORTING AND RECORD VIOLATIONS--PENALTY.--A person who, in an application, book or record required to be maintained [by] pursuant to the Gaming Control and Horse Racing Act, [or by] a [regulation] rule adopted under that act or in a report required to be submitted [by] pursuant to that act or a [regulation] rule adopted under that act, knowingly makes a statement or entry that is false or misleading or fails to maintain or make an entry the person knows is required to be maintained or made is guilty of a fourth degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978."

     SECTION 56. Section 60-2E-55 NMSA 1978 (being Laws 1997, Chapter 190, Section 57) is amended to read:

     "60-2E-55. CRIME--UNLAWFUL MANUFACTURE, SALE, DISTRIBUTION, MARKING, ALTERING OR MODIFICATION OF DEVICES ASSOCIATED WITH GAMING--UNLAWFUL INSTRUCTION--PENALTY.--

          A. A person who manufactures, sells or distributes a device that is intended by [him] the person to be used to violate [any] a provision of the Gaming Control and Horse Racing Act is guilty of a fourth degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978.

          B. A person who marks, alters or otherwise modifies [any] a gaming device in a manner that affects the result of a wager by determining win or loss or alters the normal criteria of random selection that affects the operation of a game or that determines the outcome of a game is guilty of a fourth degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978."

     SECTION 57. Section 60-2E-57 NMSA 1978 (being Laws 1997, Chapter 190, Section 59) is amended to read:

     "60-2E-57. CRIME--GENERAL PENALTIES FOR VIOLATION OF ACT.--A person who willfully violates, attempts to violate or conspires to violate any of the provisions of the Gaming Control and Horse Racing Act specifying prohibited acts, the classification of which is not specifically stated in that act, is guilty of a fourth degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978."

     SECTION 58. Section 60-2E-58 NMSA 1978 (being Laws 1997, Chapter 190, Section 60) is amended to read:

     "60-2E-58. DETENTION AND QUESTIONING OF A PERSON SUSPECTED OF VIOLATING ACT--LIMITATIONS ON LIABILITY--POSTING OF NOTICE.--

          A. A gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee or its officers, employees or agents may question a person in its gaming establishment or horse racetrack suspected of violating [any of] the provisions of the Gaming Control and Horse Racing Act. No gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee or any of its officers, employees or agents is criminally or civilly liable:

                (1) on account of any such questioning; or

                (2) for reporting to the board or law enforcement authorities the person suspected of the violation.

          B. A gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee or any of its officers, employees or agents who has reasonable cause for believing that there has been a violation of the Gaming Control and Horse Racing Act in the gaming establishment or horse racetrack by a person may detain that person in the gaming establishment or horse racetrack in a reasonable manner and for a reasonable length of time. Such a detention does not render the [gaming operator] licensee or [his] the licensee's officers, employees or agents criminally or civilly liable unless it is established by clear and convincing evidence detention was unreasonable under the circumstances.

          C. No gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee or its officers, employees or agents are entitled to the immunity from liability provided for in Subsection B of this section unless there is displayed in a conspicuous place in the gaming establishment or horse racetrack a notice in boldface type clearly legible and in substantially this form:

"Any gaming operator licensee, racetrack gaming operator licensee or racetrack operator licensee or any of [his] the licensee's officers, employees or agents who have reasonable cause for believing that [any] a person has violated [any] a provision of the Gaming Control and Horse Racing Act prohibiting cheating in gaming and horse racing may detain that person in the establishment."."

     SECTION 59. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] BREEDERS' AWARDS.--

          A. The New Mexico horse breeders' association shall create a fund to pay horse breeders of New Mexico-bred horses merit and incentive awards.

          B. A racetrack gaming operator licensee shall pay into a fund created by the New Mexico horse breeders' association an amount equal to ten percent of the first money of a purse won, except for stakes-race purses, at a horse race in New Mexico by a horse registered with the New Mexico horse breeders' association as a New Mexico-bred horse. From stakes-race purses, a racetrack gaming operator licensee shall pay into the fund created by the New Mexico horse breeders' association an amount equal to ten percent of the added money.

          C. The money deposited with the New Mexico horse breeders' association by a racetrack gaming operator licensee pursuant to Subsection B of this section shall be paid weekly to the owner of the dam of the horse at the time that the animal was foaled upon certification of the board and the New Mexico horse breeders' association.

          D. In addition to the money distributed pursuant to Subsection B of this section, the New Mexico horse breeders' association shall distribute the money allocated to the New Mexico horse breeders' association pursuant to Section 43 of this 2011 act in the following manner and pursuant to rules adopted by the board:

                (1) forty-five percent of the money to the owners at the time the winners were foaled of the dams of the first-place winners;

                (2) seven percent of the money to the owners at the time the winners were foaled of the studs that sired the first-place winners;

                (3) no more than eight percent of the money to be retained by the New Mexico horse breeders' association for the purpose of administering the distribution program set forth in this section; and

                (4) the remaining money to be divided among the first-, second- and third-place finishers during each race meet; provided that the first-, second- and third-place finishers are registered as New Mexico-bred horses with the New Mexico horse breeders' association."

     SECTION 60. A new section of the Gaming Control and Horse Racing Act is enacted to read:

     "[NEW MATERIAL] INABILITY TO RECEIVE OR ADMINISTER DISTRIBUTIONS--NEW MEXICO HORSE BREEDERS' ASSOCIATION--NEW MEXICO HORSEMEN'S ASSOCIATION--BOARD AUTHORITY--NEW MEXICO-BRED HORSE REGISTRY.--

          A. In the event that money allocated to the New Mexico horse breeders' association pursuant to Section 43 of this 2011 act cannot be received or administered by the New Mexico horse breeders' association, the board or another organization designated by the board and under the absolute control of the board shall receive and administer the money that is allocated to be distributed to the horse breeders' association pursuant to Section 59 of this 2011 act. If the board or its designee organization is required to receive, administer and distribute money on behalf of the New Mexico horse breeders' association, the maximum percentage of retainage from Paragraph (3) of Subsection D of Section 59 of this 2011 act shall be distributed by the board to the New Mexico horse breeders' association as a fee to certify the dam and stud of New Mexico-bred horses from the registry maintained by the New Mexico horse breeders' association.

          B. In the event that money allocated to the New Mexico horsemen's association pursuant to the Gaming Control and Horse Racing Act cannot be received or administered by the New Mexico horsemen's association, the board or another organization designated by the board and under the absolute control of the board shall receive and administer the money that is allocated by Section 43 of this 2011 act to the New Mexico horsemen's association and distribute the money as required by Section 43 of this 2011 act."

     SECTION 61. A new section of the Tax Administration Act is enacted to read:

     "[NEW MATERIAL] DISTRIBUTIONS--DAILY HORSE RACING TAXES--MUNICIPAL SHARES.--The following distributions shall be made pursuant to the provisions of Section 7-1-6.1 NMSA 1978 from the following amounts transferred to the department from the racing suspense account:

          A. one hundred fifty dollars ($150) of the daily pari-mutuel excise tax imposed by Section 36 of this 2011 act remitted by a class A racetrack gaming operator licensee shall be distributed to the treasury of the municipality in which the class A racetrack gaming operator licensee's horse racetrack is located if the class A racetrack gaming operator licensee's racetrack is located in an incorporated municipality with a population according to the most recent federal decennial census that is either:

                (1) less than six thousand persons if located in a county with a population of more than ten thousand but less than fifteen thousand persons; or

                (2) more than eight thousand persons but less than ten thousand persons if located in a county with a population of more than one hundred thousand persons but less than one hundred fifty thousand persons; and

          B. the balance of the daily racing tax imposed by Section 37 of this 2011 act after deductions pursuant to Subsection B of that section are taken shall be distributed to the treasury of a municipality in which a horse racetrack is located that is eligible for distributions pursuant to Section 37 of this 2011 act."

     SECTION 62. A new section of the Tax Administration Act is enacted to read:

     "[NEW MATERIAL] RACING SUSPENSE ACCOUNT--GAMING CONTROL BOARD ACCESS TO INFORMATION.--The department shall provide the gaming control board with monthly reports on the deposits, balances, refunds and transfers from the racing suspense account and shall provide additional information about the account upon request by the gaming control board. Information about the account may be disclosed fully to the gaming control board, including deposits attributed to specific horse racetracks."

     SECTION 63. TEMPORARY PROVISION--TRANSFERS--STATUTORY REFERENCES.--

          A. On the effective date of this act, all functions, appropriations, money, records, files, furniture, equipment, supplies and other property of the state racing commission are transferred to the gaming control board.

          B. On the effective date of this act, all contractual obligations of the state racing commission shall be binding on the gaming control board.

          C. On the effective date of this act, all references in law to the state racing commission shall be deemed to be references to the gaming control board.

     SECTION 64. REPEAL.--Sections 60-1A-1 through 60-1A-30 NMSA 1978 (being Laws 2007, Chapter 39, Sections 1 through 29 and 33) are repealed.

     SECTION 65. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2011.

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