WV Senate passes bills on ADW, restoration of purse money

By: Tom LaMarra

Posted: Feb. 28, 2018

The West Virginia Senate Feb. 28 passed two bills, one that would authorize advance deposit wagering and another that would restore purse money that has been used to help cover an unfunded liability for the state workers’ compensation program.

Meanwhile, it appears legislation that would allow the racing commission to join an equine medication and drug-testing standards compact may have to wait until next year. The bill, which has been endorsed by racing regulatory agencies in Delaware and Maryland and is moving through the legislative process, would allow for quicker adoption of model rules simultaneously in member states.

The ADW bill, which passed the Senate on a 29-5 vote and now goes to the House of Delegates, calls for a 6% source-market fee on total pari-mutuel handle and a 1% regulatory fee for the West Virginia Racing Commission. Based on a projected $10 million in handle from ADW, the racing industry would get $600,000 and the racing commission $100,000, according to a fiscal note.

All source-market fees would be prorated based on each track’s total ADW handle. Of the total revenue generated, 45% would go to purses at each track and 45% would remain with the track operator. The remaining 10% would go to Thoroughbred and Greyhound breed development funds.

Each ADW licensee would have to pay a fee not to exceed $5,000 a year. The fiscal note suggests the WVRC could receive about $120,000 a year for operations from the handle fee and license fees.

John Cavacini, a lobbyist who serves as President of the West Virginia Racing and Gaming Association, a group that represents racetrack casinos, said the ADW bill came about through cooperation among all stakeholders.

“If everybody walks away (from negotiations) a little disappointed and a little happy, we’ve done our job,” Cavacini said during a Feb. 27 WVRC meeting. “I don’t think I’ve found a piece of legislation affecting more people from a positive standpoint. Hopefully we’ll have some success on other bills.”

The bill regarding changes in distribution of racetrack video lottery terminal funds passed by a vote of 34-0 and was sent to the House. Purses and breed development programs for decades have received a percentage of VLT revenue.

Republican Sen. Craig Blair, who represents part of the Eastern Panhandle, where Hollywood Casino at Charles Town Races is located, said on the Senate floor that beginning in the mid-2000s about $11 million a year in VLT funds designated for purses and breeding programs was diverted to fund the struggling workers’ comp program. The funding shift was to sunset when the workers’ comp program was made whole—projected for the end of 2018—but in 2014 lawmakers passed another bill that moves the purse money each year to the Excess Lottery Revenue Fund, which can be used at their discretion.

Blair and West Virginia horsemen believe it’s a matter of fairness in that other groups that had to contribute to the unfunded workers’ comp liability will have funds restored by the end of 2018. The Senate earlier on Feb. 28 passed by a 34-0 vote another bill that terminates a $9-million-a-year workers’ comp debt-reduction assessment on self-insured employees.

The shift of the money coupled with subsequent cuts in purses and breed development revenue from VLTs because of changes in legislative formulas have played a major role in a reduction of live racing opportunities at Charles Town and Mountaineer Casino, Racetrack & Resort. Charles Town this year will race 162 programs, down from 166 last year, while Mountaineer will offer 123 cards, down from 131 in 2017. Each track at one time offered more than 200 programs a year.

The WVRC had submitted four of its own pieces of legislation—including the medication compact bill—to he governor’s office, which cleared them to proceed. But WVRC Executive Director Joe Moore at the Feb. 27 meeting said the bills were pulled from consideration for now because of concern from horsemen’s groups.

Kelli Talbott, Senior Deputy Attorney General for the racing commission, said she is attending a Mid-Atlantic meeting March 20 at which medication, drug testing and the proposed state compact will be discussed. She noted that other jurisdictions are moving forward, and that West Virginia is at a disadvantage because of scheduling.

“One unique difference in West Virginia is a limited legislative session (that ends in June),” Talbott said. “Other Mid-Atlantic states except Maryland have legislatures that are in session on and off through the year. There is not much more than a minimal window to put forth a compact bill here.”

The National HBPA at its March convention is expected to discuss the medication compact.

(Charles Town photo by Tom LaMarra)