Washington Horse Racing Commission
Meeting Minutes
December 14, 2006

Present were: Hartly Kruger, Acting Chairperson; Jeff Colliton, Commissioner; Paul George, Commissioner; A. L. Hallowell, DVM, Commissioner; Susan Carlson, Assistant Attorney General; Robert M. Leichner, Executive Secretary; Patty Sorby, Confidential Secretary. Chairperson Carol Smith-Merkulov excused.

Item #1. Approval of the meeting minutes of November 9, 2006.

Commissioner Colliton moved to approve the minutes as submitted. Commissioner Hallowell seconded the motion. Unanimously approved.

Item #2. Chairperson’s report.

Commissioner Kruger reported on his attendance at the University of Arizona, Race Track Industry Program symposium held December 4-7. Commissioner Kruger gave a brief update on the financial position of the National Racing Compact (NRC).

The symposium was also attended by Susie Sourwine, Marketing Director - Emerald Downs, Paul Ryneveld, Racing Secretary – Emerald Downs and MaryAnn O’Connell, Executive Director, Horsemen’s Benevolent & Protective Association. Each provided positive comments on the symposium.

Item #3. Emerald Downs’ report.

Mr. Ron Crockett, President, Northwest Racing Associates LP, reported that projections for 2007 purses would be as expected. Mr. Crockett was pleased with the advance deposit wagering growth. Mr. Crockett said he was concerned that costs for receiving simulcast signals may increase, but at this time there was no change. He said that he had nothing negative to report.

Item #4. Ownership change for Emerald Downs’ satellite in Shoreline, WA, the Drift On Inn.

Robert Leichner said an application for change of ownership for the Drift On Inn satellite facility located in Shoreline had been received from Emerald Downs. WHRC Investigator Walter Roderick completed a background investigation on the individuals involved in the corporation and found nothing negative. Investigator Roderick recommended approval.

Robert Fraser, Vice-President, Operations for Emerald Downs stated the corporation taking over operations at the Drift On Inn was large and is involved in mini-casinos. He felt this was a positive change.

Commissioner George moved to approve the ownership change at the Drift On Inn satellite facility located in Shoreline, Washington. Commissioner Hallowell seconded the motion. Unanimously approved.

Item #5. Emerald Downs 2007 live race dates.

Mr. Crockett requested the Commission allow him to present his proposed race dates at the January 2007 meeting. He anticipated the same number of live days as in 2006, ninety-one days. The Commission approved his request.

Item #6. Rules of Racing: Adoption Hearings:
a. WAC 260-36-085 License and fingerprint fees. (Amendments)
b. WAC 260-36-010; 015; 030; 050; 060; 062; 065; 080; 100; 110; 120; 150; 180; 200; 210. (Amendments)

Doug Moore presented the amendments for adoption for WAC 260-36-085 regarding license fee increases. Mr. Moore said this was a minimal increase within the limits of the fiscal growth factor. The license fee increases and the other amendments had been shared with stakeholders and no comments had been received. Staff recommended adoption.

No public comment was offered.

Commissioner Colliton moved to adopt the amendments to chapter 260-36-085 WAC License and fingerprint fees. Commissioner George seconded the motion. Unanimously approved.
c. WAC 260-36-220; 230; 240 Industrial Insurance. (New Section)

Mr. Moore stated the racing industry had requested a new format for Labor and Industries premiums to make them more equitable. A workgroup was established and the recommendations of the workgroup are incorporated in the proposed rules. These new sections are required in order to implement the recommendations of the workgroup. Stakeholders were sent copies of the new sections and no comments were received. Staff recommended adoption of the new sections to chapter 260-36 WAC.

No public comment was offered.

Commissioner Colliton moved to adopt the new sections in chapter 260-36 WAC. Commissioner George seconded the motion. Unanimously approved.

d. WAC 260-12-145 Persons bound by laws and rules. (New Section); WAC 260-12-130 & 140 (Repealed).

Mr. Moore explained the new section consolidated two existing rules into one and then the two existing rules are repealed. The stakeholders were furnished copies of the changes and no comments were received. Staff recommended adoption of the new section and repeal of the conflicting rules.

No public comment was offered.

Commissioner George moved to adopt the new section WAC 260-12-145 and repeal WAC 260-12-130 and 140. Commissioner Hallowell seconded the motion. Unanimously approved.

Item #7. L&I hearing on medical aid fund moratorium for 2007.

Mr. Leichner explained the Department of Labor & Industries (L&I) will hold a public hearing on a proposal to suspend payment of medical aid fund premiums for the last six months of 2007. Mr. Leichner provided prepared comments for the Commission’s review and approval that requested L&I incorporate the medical aid fund savings for 2007 for the horse industry account into the new rates for 2008. Mr. Leichner requested the Commission’s approval to present these comments at the L&I public hearing scheduled on December 15, 2006.

Mr. Crockett and Mr. Hodge both stated that Mr. Leichner’s proposal for how to apply the suspension of medical aid fund premiums to horse racing was the fairest method.

Commissioner Colliton moved that Mr. Leichner present the prepared comments to the Department of Labor & Industries at the December 15 meeting. Commissioner Hallowell seconded the motion. Unanimously approved.

Item #8. WHRC Policy Statement 2006-04 Equine Testing Policy.

Mr. Leichner said the changes to the Equine Testing Policy were grammatical changes making it clearer, easier to understand.

Commissioner George moved to adopt WHRC Policy Statement 2006-04 Equine Testing Policy. Commissioner Colliton seconded the motion. Unanimously approved.

Item #9. Executive Secretary report:

a. Agency request legislation.

Having obtained the approval from the Governor’s office, Mr. Leichner said he would make appointments with legislators to obtain sponsors for our agency request legislation.

Mr. Crockett suggested speaking with WHRC ex-officio member Senator Marilyn Rasmussen and find out who she might suggest.

Commissioner Kruger said that he had talked with Representative Timm Ormsby in Spokane and Commissioner Colliton had a conversation with newly elected Senator Chris Marrs. Commissioners Kruger and Colliton both said they would be talking more with legislators about the legislation.

b. Accountant’s recap November 2005/2006.

Mr. Leichner explained the accountant’s recap for figures by month and year-to-date.

c. 2005/2007 Budget.

Mr. Leichner explained the revenues and expenditures. The fund balance at the end of November was $672,40l. For November, revenues exceeded expenditures by about $52,000.

Cliff Schellinger, President, Tri-City Horse Racing Association, sent before and after photos of the renovations, painting of the barns and of the rail renovation at Sun Downs. Mr. Leichner said it was a great improvement and the grant monies were put to good use.

Mr. Crockett commented that he was concerned about the availability of incentive grant money in the future. Rising costs may preclude the WHRC’s ability to give as much money in 2007.

d. Request to send two employees to accreditation training.

Mr. Leichner requested to send two employees to the steward’s accreditation course to be held January 22 – 28, 2008 at Los Alamitos Race Course. He requested Jody Parmenter and Amanda Benton.

Commissioner Hallowell moved to send Jody Parmenter and Amanda Benton to steward’s accreditation January 22-28, 2008. Commissioner George seconded the motion. Unanimously approved.

Mr. Leichner wanted to state on the record his appreciation and thanks for the outstanding job that Mr. Bill Dewey has done to incorporate the license fee and L&I changes into the WHRC licensing program.

Commissioner Kruger said to give Bill a round of applause and congratulations.

Item #10. Any other business that may be properly brought before the Commission.

Ron Crockett sent congratulations to Robert Lopez on his courage relating to his recent health issues.

Commissioner George asked when licensing would begin for the 2007 season. Mr. Leichner said that licensing would begin December 15, 2006 at the Olympia office.

Commissioner Hallowell commented on the before and after photos of the barn area at Sun Downs and asked whether the county would be able to help maintain the barns in the future. Mr. Leichner suggested that commissioners speak with the county officials and also bring up the possibility of matching funds for the grant money awarded by the WHRC. Commissioner Kruger suggested communicating with the fair board also. Commissioner Colliton suggested appearing at one of their meetings. He felt a personal exchange would be useful.

Commissioner Kruger hearing nothing further wished everyone happy holidays and adjourned the meeting.

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Robert M. Leichner, Executive Secretary