Question Submitted By: Osborn, 103118 OKAG, 2018 OK AG 14

Docket Nº:2018 OK AG 14
Party Name:Question Submitted by: The Honorable Leslie Osborn, Oklahoma State Representative District 47
Attorney:MIKE HUNTER ATTORNEY GENERAL OF OKLAHOMA. RICHARD D. OLDERBAK ASSISTANT ATTORNEY GENERAL.
Case Date:October 31, 2018
Court:Oklahoma Attorney General Opinions
 
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2018 OK AG 14

Question Submitted by: The Honorable Leslie Osborn, Oklahoma State Representative District 47

No. 2018 OK AG 14

Oklahoma Attorney General Opinions

October 31, 2018

MIKE HUNTER ATTORNEY GENERAL OF OKLAHOMA.

RICHARD D. OLDERBAK ASSISTANT ATTORNEY GENERAL.

¶0 This office has received your request for an official Attorney General Opinion in which you ask, in effect, the following questions: 1. Do the requirements of 62 O.S.2011, § 211 apply to the Oklahoma Horse Racing Commission?

2. If the answer to Question #1 is yes, which streams of revenue are subject to the ten-percent contribution requirements of 62 O.S.2011, § 211 ?

I.

BACKGROUND

¶1 The Oklahoma Horse Racing Commission (the "Commission") was created in 1983 for the purpose of regulating horse racing in Oklahoma. See 3A O.S.2011, § 203.7. The Oklahoma Horse Racing Act ("OHRA") vests the Commission with plenary power to promulgate rules and regulations "for the forceful control" of horse racing in the State. Id. The Commission thus has broad authority to, among other things, (i) administer the OHRA and promulgate rules thereunder, (ii) supervise horse racing events, 1 including wagering thereon, and the issuance and regulation of horse racing licenses, (iii) promulgate rules governing the rates charged for race track admission and for services performed and items sold at race tracks, (iv) approve all construction on property owned by an organization licensee, (v) investigate and impose penalties against licensees, and (vi) adjudicate controversies arising from enforcement of the provisions of the OHRA. Id. § 204. The Commission also has specific statutory power to license and employ stewards who are present at horse racing events to enforce Commission rules and regulations and the provisions of the OHRA. Id. § 203.4.

¶2 Prior to 2017, "[a]ll funds received by the Commission from fees, fines, reimbursements, and sale of materials" were deposited into the State's General Revenue Fund. 3A O.S.2011, § 204.1A (D). However, there were two exceptions to this mandate. First, assessments on organization licensees for equine drug testing were deposited into the Equine Drug Testing Revolving Fund. Id. § 204.1B. Second, the State-Tribal Gaming Act authorized the Commission to charge an application fee of $50, 000 to organizations seeking a license to conduct casino-style gaming at horse tracks, a separate fee to cover the costs of regulating such gaming, and fees for issuing occupation gaming licenses, conducting background investigations, and fingerprinting. 3A O.S.Supp.2012, § 282. These fees were to be deposited into the Oklahoma Horse Racing Commission Gaming Regulation Revolving Fund and used for the purpose of regulating gaming conducted by the organization licensee. Id. § 282(E).

¶3 Separately, wagering on horse races generates tax revenue through an 18 percent retention on all money wagered, of which one-ninth is remitted to the Oklahoma Tax Commission ("OTC"). See 3A O.S.2011, § 205.6. Prior to 2017, the one-ninth remitted to OTC was apportioned to the General Revenue Fund. Of the remainder, five-ninths was retained by the organization licensee and three-ninths was paid out as purses for participating horses. See id. § 205.6(B)(1).

¶4 In 2017, the Legislature amended certain provisions of the OHRA and State-Tribal Gaming Act. Section 204.1A of the OHRA--which required "[a]ll funds received by the Commission from fees, fines, reimbursements, and sale of materials" to be deposited into the State's General Revenue Fund--was repealed and a new Section 204.1C was added to establish the Oklahoma Horse Racing Commission Operational Expenses Revolving Fund (the "OHRC Fund"). See 2017 Okla. Sess. Laws ch. 116, §§ 1, 8. In addition, Sections 204.2 and 205.2 of the OHRA were amended to redirect revenue from license fees from the General Revenue Fund to the OHRC Fund. See id. §§ 3, 4. Finally, Section 205.6(B)(1) of the OHRA was amended to similarly redirect the one-ninth of...

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