Establishes pari-mutuel horse racing in Hawaii.  Establishes
regulatory board in DCCA.  Describes powers and duties of board,
meetings, quorum, etc.  Requires bonding of employees and certain
board members.  Establishes licensed wagering facilities and
procedures for application, eligibility refusal, termination,
transfer, subcontracting, and revocation of license.  Requires
board to adopt and publish rules at least annually in pamphlet
form.  Describes conduct of pari-mutuel horse racing.  Exempts
pari-mutuel horse racing from gambling laws. Adds language for an
advisory referendum.

THE SENATE                              S.B. NO. 476
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  The decision to close Hawaii's sugar plantations
 2 is long past, and there is a need for the State to encourage the
 3 development of industries which do not impact heavily on our
 4 environment.  The legislature recognizes that there is a need to
 5 expand the economic base of this great State in order to ensure
 6 increasing revenues.
 7      The land which lays fallow since the closure of our sugar
 8 plantations number in the thousands of acres, and may continue
 9 indefinitely.  One industry which has demonstrated its worth to
10 communities in the United States is horse racing.  It allows for
11 as much as five hundred acres to be retained for an
12 environmentally friendly use.  From an economic standpoint, a
13 fully operating track will employ more than six thousand
14 employees in well-paying union jobs.  In areas where a race track
15 was built, this industry has spawned the development of many
16 small businesses.  It has been estimated that one hundred
17 thousand new jobs have been created in cities with a race track.
18      The race track activities will involve betting, which is
19 classified as pari-mutuel, as opposed to casino gambling.  With
20 betting, approximately eighty per cent is paid out to the players

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                                     S.B. NO.           476

 1 (which is reason for the odds) while ten per cent is paid to the
 2 State in taxes and the remaining ten per cent is applied to track
 3 expenses.  The favorable feature of this activity is that the
 4 bettors number in the thousands, who will then have money in
 5 their pockets to spend, which will boost the State's economy.
 6 Casino gambling, on the other hand, pays eighty per cent to the
 7 house with ten per cent paid to the players.
 8      In addition to the open spaces, the race track will add
 9 another dimension to our medical community in the form of an
10 increased need for veterinarians.  This need for veterinarians
11 may encourage the John Burns School of Medicine, to expand its
12 programs in this area accordingly.
13      The motion picture industry has indicated that a race track
14 is a huge pre-requisite for major involvement in Hawaii.  "Build
15 it and they will come."
16      Pari-mutuel horse racing is a popular and widespread form of
17 legalized wagering in the United States, having been approved by
18 forty-four states.  Pari-mutuel horse racing and facilities are
19 operated by private groups under strict federal and state
20 government regulation and law enforcement.  The industry is also
21 regulated by the Thoroughbred Racing Association, the
22 Thoroughbred Racing Protective Bureau, the United States Trotting

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                                     S.B. NO.           476

 1 Association, and the Association of Racing Commissioners
 2 International.
 3      Horse racing began in Hawaii in the early twentieth century
 4 with the importation by the Big Island's Parker Ranch of top
 5 racing lines of horses from the United States mainland and
 6 England to develop thoroughbreds in Hawaii.  Horse racing was an
 7 active pursuit for a great many people for recreation and
 8 employment on the Big Island for many years prior to the Second
 9 World War.  On Oahu, horse racing officially began in 1939 when
10 the Oahu Jockey Club was incorporated and the Kailua race track
11 was constructed.  According to newspaper accounts, modern horse
12 racing on Oahu flourished until 1952.  Attempts to conduct horse
13 racing at Kapiolani Park failed in 1949, and a bill in 1959 to
14 permit horse racing on Maui failed to pass the house of
15 representatives.
16      The legislature believes that the development of a pari-
17 mutuel horse racing industry in Hawaii would provide many
18 economic development opportunities, including the expansion of
19 horse breeding, feed, and other related agricultural industries,
20 and increased sources of revenue from newly generated business,
21 hotel, restaurant, and airline activities.  In addition to an
22 increased need for veterinarians, new jobs, such as stable hands,