88R14249 BEE-F     By: Thompson of Harris H.B. No. 4115       A BILL TO BE ENTITLED   AN ACT   relating to eligibility for membership on and the regulation of   horse and greyhound racing by the Texas Racing Commission; creating   a criminal offense.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 2021.003, Occupations Code, is amended   by adding Subdivision (29-a) to read as follows:                (29-a)  "Occupational license" means a license issued   to an individual to conduct activities prescribed for that license   in the commission rules.          SECTION 2.  Section 2021.006, Occupations Code, is amended   to read as follows:          Sec. 2021.006.  RELEASE OF CIVIL LIABILITY. A commission   member, a commission employee, a person contracted by the   commission, a steward or judge, a racetrack association, a   horsemen's organization, or any other person regulated under this   subtitle is not liable for a cause of action that arises out of that   person's performance or exercise of discretion in the   implementation or enforcement of this subtitle or a rule adopted   under this subtitle if the person has acted in good faith.          SECTION 3.  Section 2022.004(e), Occupations Code, is   amended to read as follows:          (e)  A person is not eligible for appointment as a commission   member or to be designated to serve as an ex officio member's   designee as described by Section 2022.001(b) if:                (1)  the person or the person's spouse:                      (A)  is licensed by the commission, except as a   commissioner;                      (B)  is employed by the commission or participates   in the management of a business entity or other organization   regulated by the commission or receiving funds from or through the   commission;                      (C)  owns or controls, directly or indirectly,   more than a 10 percent interest in a business entity or other   organization regulated by the commission or receiving funds from or   through the commission; or                      (D)  uses or receives a substantial amount of   tangible goods, services, or funds from or through the commission,   other than compensation or reimbursement authorized by law for   commission membership, attendance, or expenses; or                (2)  the person:                      (A)  owns any financial interest in a racetrack or   its operation or is related within the second degree by affinity or   the third degree by consanguinity, as determined under Subchapter   B, Chapter 573, Government Code, to a person who owns any financial   interest in a racetrack or its operation; [or]                      (B)  has been convicted of a felony; or                      (C)  has held a license issued by the commission   during the 10-year period preceding the appointment [of any crime   involving moral turpitude].          SECTION 4.  The heading to Section 2022.052, Occupations   Code, is amended to read as follows:          Sec. 2022.052.  EMPLOYEES; RESTRICTIONS ON EMPLOYMENT;   CONTRACTING.          SECTION 5.  Sections 2022.052(a) and (c), Occupations Code,   are amended to read as follows:          (a)  The commission shall hire employees or contract with   persons as necessary to administer this subtitle.          (c)  The commission may not employ or continue to employ or   contract with or continue to contract with a person who:                (1)  owns or controls a financial interest in a   commission license holder;                (2)  is employed by or serves as a paid consultant to a   commission license holder, an official state breed registry, or a   Texas trade association, as defined by Section 2022.004(a), in the   field of horse or greyhound racing or breeding;                (3)  owns or leases a race animal that participates in   pari-mutuel racing in this state;                (4)  accepts or is entitled to any part of the purse or   Texas-bred incentive award to be paid on a horse or a greyhound in a   race conducted in this state; or                (5)  resides with or is related within the first degree   by affinity or consanguinity to a person subject to a   disqualification prescribed by this subsection.          SECTION 6.  Sections 2023.053(c) and (f), Occupations Code,   are amended to read as follows:          (c)  Any unappropriated money exceeding $2 million   [$750,000] that remains in the fund at the close of each state   fiscal biennium shall be transferred to the general revenue fund   and may be appropriated for any purpose.          (f)  This section does not apply to money deposited into the   Texas-bred escrow account [incentive fund] established under   Section 2028.301.          SECTION 7.  Section 2023.061(a), Occupations Code, is   amended to read as follows:          (a)  Not later than January 31 of each year, the commission   may [shall] file a report with the governor, lieutenant governor,   and speaker of the house of representatives. The report may   include, to the extent the commission considers appropriate:                (1)  descriptions of changes to commission programs;   and                (2)  recommendations to the governor and the   legislature.           SECTION 8.  Section 2024.055(b), Occupations Code, is   amended to read as follows:          (b)  This section does not apply to money deposited into the   Texas-bred escrow account [incentive fund] established under   Section 2028.301.          SECTION 9.  Section 2025.001, Occupations Code, is amended   by adding Subsection (a-1) to read as follows:          (a-1)  The commission shall comply with Chapter 53 in the   administration of the commission's licensing program.          SECTION 10.  Section 2025.262, Occupations Code, is amended   to read as follows:          Sec. 2025.262.  GROUNDS FOR DENIAL, REVOCATION, AND   SUSPENSION OF OCCUPATIONAL LICENSE. The commission may refuse to   issue any original or renewal license under this subchapter or may   revoke or suspend the license if, after notice and hearing, the   commission finds that the applicant or license holder, as   appropriate:                (1)  has been convicted of a violation of this subtitle   or a commission rule or has aided, abetted, or conspired to commit a   violation of this subtitle or a commission rule;                (2)  has been convicted of a felony [or a crime   involving moral turpitude] that is reasonably related to the   person's present fitness to hold a license under this subtitle;                (3)  has violated or has caused to be violated this   subtitle or a commission rule in a manner that involves moral   turpitude, as distinguished from a technical violation of this   subtitle or a rule;                (4)  is unqualified, by experience or otherwise, to   perform the duties required of a license holder under this   subtitle;                (5)  failed to answer or has falsely or incorrectly   answered a question in an original or renewal application;                (6)  fails to disclose the true ownership or interest   in a horse or greyhound as required by commission rules;                (7)  is indebted to this state for any fee or for the   payment of a penalty imposed by this subtitle or a commission rule;                (8)  is not of good moral character or the person's   reputation as a peaceable, law-abiding citizen in the community   where the person resides is bad;                (9)  is in the habit of using alcoholic beverages to an   excess or uses a controlled substance as defined in Chapter 481,   Health and Safety Code, or a dangerous drug as defined in Chapter   483, Health and Safety Code, or is mentally incapacitated;                (10)  may be excluded from an enclosure under this   subtitle;                (11)  has improperly used a temporary pass, license   certificate, credential, or identification card issued under this   subtitle;                (12)  resides with a person whose license was revoked   for cause during the 12 months preceding the date of the present   application;                (13)  has failed or refused to furnish a true copy of   the application to the commission's district office in the district   in which the premises for which the license is sought are located;   or                (14)  is engaged or has engaged in activities or   practices that are detrimental to the best interests of the public   and the sport of horse racing or greyhound racing.          SECTION 11.  Section 2026.051, Occupations Code, is amended   to read as follows:          Sec. 2026.051.  COMMISSION RULES REGARDING EXCLUSION OR   EJECTION. The commission shall adopt rules providing for the   exclusion or ejection from an enclosure where horse or greyhound   races are conducted, or from specified portions of an enclosure, of   a person:                (1)  who has engaged in bookmaking, touting, or illegal   wagering;                (2)  whose income is from illegal activities or   enterprises;                (3)  who has been convicted of a violation of this   subtitle;                (4)  who has been convicted of theft;                (5)  who has been convicted under the penal law of   another jurisdiction for committing an act that would have   constituted a violation of any rule described in this section;                (6)  who has committed a corrupt or fraudulent act in   connection with horse or greyhound racing or pari-mutuel wagering   or who has committed any act tending or intended to corrupt horse or   greyhound racing or pari-mutuel wagering;                (7)  who is under suspension or has been excluded or   ejected from a racetrack by the commission or a steward in this   state or by a corresponding authority in another state because of   corrupt or fraudulent practices or other acts detrimental to   racing;                (8)  who has submitted a forged pari-mutuel ticket or   has altered or forged a pari-mutuel ticket for cashing or who has   cashed or caused to be cashed an altered, raised, or forged   pari-mutuel ticket;                (9)  who has been convicted of committing a lewd or   lascivious act [or other crime involving moral turpitude];                (10)  who is guilty of boisterous or disorderly conduct   while inside an enclosure;                (11)  who is an agent or habitual associate of a person   excludable under this section; or                (12)  who has been convicted of a felony.          SECTION 12.  Section 2028.103(a-1), Occupations Code, is   amended to read as follows:          (a-1)  The commission shall deposit money paid to the   commission under Subsection (a) into the Texas-bred escrow account   [incentive fund] established under Section 2028.301. The   commission shall distribute the money collected under this section   and deposited into the fund to the appropriate state horse breed   registries for the Texas-bred program in accordance with rules   adopted under Subsection (c).          SECTION 13.  Sections 2028.105(d) and (d-1), Occupations   Code, are amended to read as follows:          (d)  The horse racetrack association shall pay to the   commission for deposit into the Texas-bred escrow account   [incentive fund] established under Section 2028.301 and   distribution to the appropriate state horse breed registry the   remaining 80 percent of the total breakage to be allocated as   follows:                (1)  40 percent to the owners of the accredited   Texas-bred horses that finish first, second, or third;                (2)  40 percent to the breeders of accredited   Texas-bred horses that finish first, second, or third; and                (3)  20 percent to the owner of the stallion standing in   this state at the time of conception whose Texas-bred get finish   first, second, or third.          (d-1)  The commission shall deposit the portions of total   breakage paid to the commission under Subsections (b) and (d) into   the Texas-bred escrow account [incentive fund] established under   Section 2028.301. The commission shall distribute the money   collected under this section and deposited into the fund to the   appropriate state horse breed registries in accordance with this   section and with rules adopted by the commission under Section   2028.103.          SECTION 14.  Section 2028.154(a), Occupations Code, is   amended to read as follows:          (a)  A greyhound racetrack association shall pay 50 percent   of the breakage to the appropriate state greyhound breed registry.   Of that breakage percentage:                (1)  25 percent is to be used in stakes races; and                (2)  25 percent of that total breakage from a live   pari-mutuel pool or a simulcast pari-mutuel pool is to be paid to   the commission for deposit into the Texas-bred escrow account   [incentive fund] established under Section 2028.301. The   commission shall distribute the money collected under this section   and deposited into the fund to the state greyhound breed registry   for use in accordance with this section and commission rules.          SECTION 15.  Section 2028.202(a-1), Occupations Code, is   amended to read as follows:          (a-1)  A racetrack association shall pay to the commission   for deposit into the Texas-bred escrow account [incentive fund]   established under Section 2028.301 the shares to be distributed   under Subsections (a)(3) and (a)(4) for the Texas-bred program.   The commission shall distribute the money collected under this   section and deposited into the fund to the appropriate state breed   registries for use under the Texas-bred program.          SECTION 16.  Section 2028.301, Occupations Code, is amended   to read as follows:          Sec. 2028.301.  TEXAS-BRED ESCROW ACCOUNT [INCENTIVE FUND].   (a) The comptroller [commission] shall deposit the state's share   of the simulcast pari-mutuel pool [money set aside for the   Texas-bred program or set aside] for use by state breed registries   under this chapter into a trust fund [an escrow account] in the   state treasury [in the registry of the commission] to be known as   the Texas-bred escrow account. Money in the account may not be   appropriated for state expenditure [incentive fund].          (b)  The commission shall distribute money from the   Texas-bred escrow account [incentive fund] in accordance with this   chapter and commission rules.          SECTION 17.  Section 2033.002, Occupations Code, is amended   to read as follows:          Sec. 2033.002.  UNLAWFUL RACING. A person commits an   offense if:                (1)  the person participates in, permits, or conducts a   horse or greyhound race at a racetrack without a permit issued under   Chapter 751, Health and Safety Code;                (2)  the person wagers on the partial or final outcome   of the horse or greyhound race or knows or reasonably should know   that another person is betting on the partial or final outcome of   the race; and                (3)  the race is not part of a performance or race   meeting conducted under this subtitle or commission rule.          SECTION 18.  Section 2033.004(a), Occupations Code, is   amended to read as follows:          (a)  A person commits an offense if the person:                (1)  conducts a horse or greyhound race without:                      (A)  a racetrack license; or                      (B)  a permit issued under Chapter 751, Health and   Safety Code; and                (2)  knows or reasonably should know that another   person is betting on the final or partial outcome of the race.          SECTION 19.  Section 2033.014, Occupations Code, is amended   by adding Subsection (a-1) to read as follows:          (a-1)  A person commits an offense if the person:                (1)  seeks to enter, train, or ride a horse for a horse   race or seeks to enter or train a greyhound for a greyhound race   that is part of a performance or race meeting conducted under this   subtitle or commission rule; and                (2)  knows or reasonably should know that the horse or   greyhound has participated in a performance or race meeting in this   state that was not conducted:                      (A)  under this subtitle or commission rule; or                      (B)  under a permit issued under Chapter 751,   Health and Safety Code.          SECTION 20.  Sections 2033.101(a) and (b), Occupations Code,   are amended to read as follows:          (a)  The executive director may issue a cease and desist   order if the executive director reasonably believes a person   [racetrack association or other license holder] is engaging or is   likely to engage in conduct that violates this subtitle or a   commission rule.          (b)  On issuance of a cease and desist order, the executive   director shall serve a proposed cease and desist order on the person   [racetrack association or other license holder] by personal   delivery or registered or certified mail, return receipt requested,   to the person's last known address.          SECTION 21.  Section 2033.104, Occupations Code, is amended   to read as follows:          Sec. 2033.104.  EMERGENCY CEASE AND DESIST ORDER; SEIZURE OF   AFFECTED ANIMALS. (a) The executive director may issue an   emergency cease and desist order if the executive director   reasonably believes a person [racetrack association or other   license holder] is engaged in a continuing activity that:                (1)  violates this subtitle or a commission rule in a   manner that threatens immediate and irreparable public harm; or                (2)  involves suspected cruelty to an animal in   violation of commission rule or Section 42.09 or 42.092, Penal   Code.          (b)  After issuing an emergency cease and desist order, the   executive director shall serve on the person [racetrack association   or other license holder] by personal delivery or registered or   certified mail, return receipt requested, to the person's last   known address, an order stating the specific charges and requiring   the person immediately to cease and desist from the conduct that   violates this subtitle or a commission rule. The order must contain   a notice that a request for hearing may be filed under this section.          (c)  On issuance of an emergency cease and desist order, the   executive director may authorize the seizure of any animal   suspected of being or to have been subject to cruelty to an animal   in violation of commission rule or Section 42.09 or 42.092, Penal   Code. An emergency cease and desist order issued under Subsection   (a)(2) satisfies the evidence requirement for a showing of probable   cause for purposes of Section 821.022, Health and Safety Code.          SECTION 22.  Section 2034.001(c), Occupations Code, is   amended to read as follows:          (c)  The commission's rules must require state-of-the-art   testing methods. The testing may:                (1)  be conducted [prerace or postrace] as determined   by the commission; and                (2)  be by an invasive or noninvasive method.          SECTION 23.  The following provisions of the Occupations   Code are repealed:                (1)  Section 2021.003(19);                (2)  Section 2023.053(e);                (3)  Sections 2023.061(b) and (c);                (4)  Section 2025.001(a); and                (5)  Section 2025.260.          SECTION 24.  Section 2021.006, Occupations Code, as amended   by this Act, applies only to a cause of action that accrues on or   after the effective date of this Act.          SECTION 25.  The term of a person who is serving as a member   of the Texas Racing Commission immediately before the effective   date of this Act and who is ineligible for appointment under Section   2022.004(e), Occupations Code, as amended by this Act, expires on   the effective date of the Act.          SECTION 26.  On September 1, 2023, money in the Texas-bred   incentive fund is transferred to the Texas-bred escrow account, and   the Texas-bred incentive fund is abolished.          SECTION 27.  The changes in law made by this Act apply only   to an offense committed on or after the effective date of this Act.   An offense committed before the effective date of this Act is   governed by the law in effect on the date the offense was committed,   and the former law is continued in effect for that purpose. For   purposes of this section, an offense was committed before the   effective date of this Act if any element of the offense occurred   before that date.          SECTION 28.  This Act takes effect September 1, 2023.