HBA-CMT H.B. 1196 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1196 By: Brimer Licensing & Administrative Procedures 7/19/2001 Enrolled BACKGROUND AND PURPOSE The Texas Racing Act contains a financial incentive program designed to improve the caliber of breeding and quality of Texas-bred horses. An accredited Texas-bred horse is a horse that is considered qualified for this program, which provides incentives to owners and breeders through supplements to purses awarded in races won by accredited Texas-bred horses. Any horse that is bred and born (foaled) in Texas qualifies as a Texas-bred horse. The accredited Texas-bred horse qualification is not lost if the mare is bred out of state and brought back for the birth of the foal and is bred back to a stallion in Texas. However, the Texas-bred foal crop has declined over the last four years. A reason for the decline is the exodus of high quality Texas mares to other states for breeding and domicile because of the lack of stallions in Texas that match the quality of Texas mares. House Bill 1196 allows a Thoroughbred or Arabian horse that is bred out of state by an accredited Texas-bred mare to qualify as a "Texas-bred horse" without limitation as long as the foal is born in Texas and provides for bonus awards as a purse supplement. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 1196 amends the Texas Racing Act to provide that an accredited Texas-bred Thoroughbred or Arabian horse is eligible for only one-half of the incentives awarded under the Texas Racing Act. The bill requires the remaining portion to be retained by the appropriate state horse breed registry for the general distribution at the same meeting in accordance with the special provisions relating to horse racing deductions from the wagering pool and allocations of shares and breakage. The bill requires that an accredited Texas-bred Thoroughbred horse that finishes first, second, or third in a race other than a Texas-bred race receive a bonus award as a purse supplement. The bill requires the allocation of a percentage of the Texas-bred program funds received under provisions for the distribution of deductions from simulcast pari-mutuel pools and special provisions relating to horse racing deductions for wagering pools and allocations of shares and breakage, excluding expenses for administration of the Texas-bred program, to be allocated as follows: _for 2002, 10 percent; _for 2003, 12.5 percent; _for 2004, 15 percent; _for 2005, 17.5 percent; _for 2006, 20 percent; _for 2007, 22.5 percent; _for 2008 and subsequent years, 25 percent. The bill amends the definition of "Texas-bred horse" to include a Thoroughbred or Arabian horse foaled in Texas by an accredited Texas-bred mare if the mare was bred outside Texas and returned to Texas on or before August 15 of the calendar year of conception. EFFECTIVE DATE January 1, 2002.