Senate File 2295 - Introduced SENATE FILE 2295 BY COMMITTEE ON STATE GOVERNMENT (SUCCESSOR TO SSB 3002) A BILL FOR An Act relating to licenses to conduct pari-mutuel wagering on 1 dog races, and including effective date provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5651SV (2) 91 ss/ns

S.F. 2295 Section 1. Section 99D.2, subsections 8, 9, and 10, Code 1 2026, are amended to read as follows: 2 8. “Race” , “racing” , “race meeting” , “track” , and “racetrack” 3 refer to dog racing and horse racing, including but not limited 4 to quarterhorse, thoroughbred, and harness racing, as approved 5 by the commission. 6 9. “Racetrack enclosure” means all real property utilized 7 for the conduct of a race meeting, including the racetrack, 8 grandstand, concession stands, offices, barns, kennels and 9 barn areas, employee housing facilities, parking lots, and 10 any additional areas designated by the commission. “Racetrack 11 enclosure” also means all real property utilized by a licensee 12 under this chapter who is not required to conduct live racing 13 pursuant to the requirements of section 99D.9A , on which 14 pari-mutuel wagering on simultaneously telecast horse or dog 15 races may be conducted and lawful gambling is authorized and 16 licensed as provided in this chapter and chapter 99F . 17 10. “Wagering area” means that portion of a racetrack in 18 which a licensee may receive wagers of money from a person 19 present in a licensed racetrack enclosure on a horse or dog in 20 a race selected by the person making the wager as designated 21 by the commission. 22 Sec. 2. Section 99D.3, Code 2026, is amended to read as 23 follows: 24 99D.3 Scope of provisions. 25 This chapter does not apply to horse-race or dog-race 26 meetings unless the pari-mutuel system of wagering is used 27 or intended to be used in connection with the horse-race or 28 dog-race meetings. If the pari-mutuel system is used or 29 intended to be used , a person shall not conduct a race meeting 30 without a license as provided by section 99D.9 . 31 Sec. 3. Section 99D.4, Code 2026, is amended to read as 32 follows: 33 99D.4 Pari-mutuel wagering legalized. 34 The system of wagering on the results of horse or dog races 35 -1- LSB 5651SV (2) 91 ss/ns 1/ 21

S.F. 2295 as provided by this chapter is legal , when conducted within 1 the racetrack enclosure at a licensed horse-race or dog-race 2 meeting. 3 Sec. 4. Section 99D.5, subsection 5, paragraph a, 4 subparagraph (2), Code 2026, is amended to read as follows: 5 (2) Participate directly or indirectly as an owner, 6 owner-trainer, trainer of a horse or dog , or jockey of a horse 7 in a race meeting conducted in this state. 8 Sec. 5. Section 99D.6, subsection 3, Code 2026, is amended 9 to read as follows: 10 3. The administrator may hire other assistants and 11 employees as necessary to carry out the commission’s duties. 12 Employees in the positions of equine veterinarian , canine 13 veterinarian, and equine steward shall be exempt from the merit 14 system provisions of chapter 8A, subchapter IV , and shall not 15 be covered by a collective bargaining agreement. Some or all 16 of the information required of applicants in section 99D.8A, 17 subsections 1 and 2 , may also be required of employees of the 18 commission if the commission deems it necessary. 19 Sec. 6. Section 99D.7, subsection 21, Code 2026, is amended 20 to read as follows: 21 21. Notwithstanding any contrary provision in this chapter , 22 to provide for interstate combined wagering pools related to 23 simulcasting horse or dog races and all related interstate 24 pari-mutuel wagering activities. 25 Sec. 7. Section 99D.8, subsection 1, Code 2026, is amended 26 to read as follows: 27 1. A qualifying organization, as defined in section 28 513(d)(2)(C) of the Internal Revenue Code, as defined in 29 section 422.3 , exempt from federal income taxation under 30 sections 501(c)(3), 501(c)(4), or 501(c)(5) of the Internal 31 Revenue Code , or a nonprofit corporation organized under the 32 laws of this state, whether or not it is exempt from federal 33 income taxation, which is organized to distribute funds for 34 educational, civic, public, charitable, patriotic, or religious 35 -2- LSB 5651SV (2) 91 ss/ns 2/ 21

S.F. 2295 uses, as defined in section 99B.1 , or which regularly conducts 1 an agricultural and educational fair or exposition for the 2 promotion of the horse , dog, or other livestock breeding 3 industries of the state, or an agency, instrumentality, or 4 political subdivision of the state, may apply to the commission 5 for a license to conduct horse or dog racing. The application 6 shall be filed with the administrator of the commission at 7 least sixty days before the first day of the horse race or dog 8 race meeting which the organization proposes to conduct, shall 9 specify the day or days when and the exact location where it 10 proposes to conduct racing, and shall be in a form and contain 11 information as the commission prescribes. 12 Sec. 8. Section 99D.9, subsection 1, Code 2026, is amended 13 to read as follows: 14 1. If the commission is satisfied that its rules and 15 sections 99D.8 through 99D.25 applicable to licensees have been 16 or will be complied with, it may issue a license for a period 17 of not more than three years. The commission may decide which 18 types of racing it will permit. The commission may permit 19 dog racing, horse racing of various types , or both dog and 20 horse racing . However, only quarter horse and thoroughbred 21 racing shall be allowed to be conducted at the horse racetrack 22 located in Polk county. The commission shall decide the 23 number, location, and type of all racetracks licensed under 24 this chapter . The license shall set forth the name of the 25 licensee, the type of license granted, the place where the 26 race meeting is to be held, and the time and number of days 27 during which racing may be conducted by the licensee. The 28 commission shall not approve a license application if any 29 part of the racetrack is to be constructed on prime farmland 30 outside the city limits of an incorporated city. As used in 31 this subsection , “prime farmland” means as defined by the United 32 States department of agriculture in 7 C.F.R. §657.5(a) . A 33 license is not transferable or assignable. The commission may 34 revoke any license issued for good cause upon reasonable notice 35 -3- LSB 5651SV (2) 91 ss/ns 3/ 21

S.F. 2295 and hearing. The commission shall conduct a neighborhood 1 impact study to determine the impact of granting a license on 2 the quality of life in neighborhoods adjacent to the proposed 3 racetrack facility. The applicant for the license shall 4 reimburse the commission for the costs incurred in making the 5 study. A copy of the study shall be retained on file with the 6 commission and shall be a public record. The study shall be 7 completed before the commission may issue a license for the 8 proposed facility. 9 Sec. 9. Section 99D.9A, subsection 1, Code 2026, is amended 10 to read as follows: 11 1. Upon written notification to the commission by September 12 1, 2014, and agreement to comply with the requirements of this 13 section , a licensee authorized to conduct pari-mutuel wagering 14 at a dog racetrack and to conduct gambling games pursuant to 15 section 99F.6 as of January 1, 2014, may, as of the live racing 16 cessation date, continue to maintain a license as provided 17 in this section for purposes of conducting gambling games 18 and pari-mutuel wagering on simultaneously telecast horse or 19 dog races without the requirement of scheduling performances 20 of live races at the dog racetrack. For purposes of this 21 section , the “live racing cessation date” is October 31, 2014, 22 for the licensee of the pari-mutuel dog racetrack located in 23 Dubuque county, and December 31, 2015, for the licensee of the 24 pari-mutuel dog racetrack located in Pottawattamie county. 25 Sec. 10. Section 99D.9A, subsections 2, 3, and 4, Code 2026, 26 are amended by striking the subsections. 27 Sec. 11. Section 99D.9A, subsection 5, paragraph a, 28 subparagraphs (1) and (3), Code 2026, are amended to read as 29 follows: 30 (1) Remain licensed under this chapter and pursuant 31 to section 99F.4A as a pari-mutuel dog racetrack licensed 32 to conduct gambling games and pari-mutuel wagering on 33 simultaneously telecast horse or dog races. 34 (3) Comply with all other applicable requirements of 35 -4- LSB 5651SV (2) 91 ss/ns 4/ 21

S.F. 2295 this chapter and chapter 99F except for those requirements 1 concerning live dog racing . 2 Sec. 12. Section 99D.9A, subsection 5, paragraph b, Code 3 2026, is amended to read as follows: 4 b. However, nothing in this chapter shall require the 5 licensee of the pari-mutuel dog racetrack in Pottawattamie 6 county to conduct pari-mutuel wagering on simultaneously 7 telecast horse or dog races to remain licensed under this 8 chapter or to conduct gambling games without the requirement of 9 scheduling performances of live dog races . 10 Sec. 13. Section 99D.9A, subsection 6, Code 2026, is amended 11 to read as follows: 12 6. a. Compliance with the requirements of this section 13 and the establishment of the Iowa greyhound pari-mutuel racing 14 fund in section 99D.9B shall constitute a full satisfaction of 15 and discharge from any and all liability or potential liability 16 of a licensee authorized to conduct gambling games in Dubuque 17 county pursuant to section 99F.4A, subsection 9 , the licensee 18 of the pari-mutuel dog racetrack located in Pottawattamie 19 county , and the Iowa greyhound association which may arise out 20 of either of the following: 21 (1) The the discontinuance of live dog racing or 22 simulcasting. 23 (2) Distributions made or not made from the Iowa greyhound 24 pari-mutuel racing fund created in section 99D.9B or the purse 25 escrow fund created in the arbitration decision issued in 26 December 1995 with regard to the purse supplements to be paid 27 at the pari-mutuel dog racetrack in Pottawattamie county. 28 b. Compliance with the requirements of this section and 29 establishment of the Iowa greyhound pari-mutuel racing fund in 30 section 99D.9B shall immunize a licensee authorized to conduct 31 gambling games in Dubuque county pursuant to a license issued 32 pursuant to section 99F.4A, subsection 9 , the licensee of the 33 pari-mutuel dog racetrack located in Pottawattamie county , 34 and the Iowa greyhound association and their respective its 35 -5- LSB 5651SV (2) 91 ss/ns 5/ 21

S.F. 2295 officers, directors, employees, board members, and agents 1 against claims of liability as described in paragraph “a” made 2 by any person or entity. 3 Sec. 14. Section 99D.9D, Code 2026, is amended to read as 4 follows: 5 99D.9D Alternative simulcasting licensure —— horse and dog 6 races. 7 1. An entity that has entered into an agreement with the 8 Iowa horsemen’s benevolent and protective association for 9 source market fees related to simultaneously telecast horse 10 or dog races may submit an application to the commission for 11 a license under this chapter to conduct pari-mutuel wagering 12 on simultaneously telecast horse or dog races, subject to 13 the requirements of this section . Unless inconsistent with 14 the requirements of this section , an entity submitting an 15 application for a license under this section shall comply with 16 all requirements for submitting an application for a license 17 under this chapter . 18 2. If an application for a license under subsection 1 is 19 approved by the commission pursuant to the requirements of 20 this section and section 99D.9 , the entity submitting the 21 application shall be granted a license under this section to 22 conduct pari-mutuel wagering on simultaneously telecast horse 23 or dog races conducted at a facility of a licensee authorized 24 to conduct gambling games under chapter 99D or chapter 99F 25 pursuant to an agreement with the licensee of that facility 26 as authorized by this section . A licensee issued a license 27 pursuant to this section shall comply with all requirements 28 of this chapter applicable to licensees unless otherwise 29 inconsistent with the provisions of this section . 30 3. A license issued pursuant to this section shall authorize 31 the licensee to enter into an agreement with any licensee 32 authorized to operate an excursion gambling boat or gambling 33 structure under chapter 99F to conduct, without the requirement 34 to conduct live horse or dog races at the facility, pari-mutuel 35 -6- LSB 5651SV (2) 91 ss/ns 6/ 21

S.F. 2295 wagering on simultaneously telecast horse or dog races at the 1 facility of the licensee authorized to operate an excursion 2 gambling boat or gambling structure under chapter 99F . 3 4. The commission shall establish an annual license fee 4 and regulatory fee for any entity issued a license under this 5 section to conduct pari-mutuel wagering on simultaneously 6 telecast horse or dog races as authorized by this section . The 7 commission shall not impose any other fees for simultaneously 8 telecast horse or dog races conducted by any licensee under 9 this section . 10 5. The commission shall require that an annual audit 11 be conducted and submitted to the commission, in a manner 12 determined by the commission, concerning the operation of the 13 simultaneously telecast horse or dog races by any licensee 14 under this section . 15 Sec. 15. Section 99D.10, Code 2026, is amended to read as 16 follows: 17 99D.10 Bond of licensee. 18 A licensee licensed under section 99D.9 , including a 19 licensee issued a license subject to the requirements of 20 section 99D.9C , shall post a bond to the state of Iowa before 21 the license is issued in a sum as the commission shall fix, 22 with sureties to be approved by the commission. The bond shall 23 be used to guarantee that the licensee faithfully makes the 24 payments, keeps its books and records and makes reports, and 25 conducts its racing in conformity with sections 99D.6 through 26 99D.23 and the rules adopted by the commission. The bond 27 shall not be canceled by a surety on less than thirty days’ 28 notice in writing to the commission. If a bond is canceled 29 and the licensee fails to file a new bond with the commission 30 in the required amount on or before the effective date of 31 cancellation, the licensee’s license shall be revoked. The 32 total and aggregate liability of the surety on the bond is 33 limited to the amount specified in the bond. 34 Sec. 16. Section 99D.11, subsections 3, 4, and 5, Code 2026, 35 -7- LSB 5651SV (2) 91 ss/ns 7/ 21

S.F. 2295 are amended to read as follows: 1 3. The licensee may receive wagers of money only from a 2 person present in a licensed racetrack enclosure on a horse 3 or dog in the race selected by the person making the wager 4 to finish first in the race or from a person engaging in 5 advance deposit wagering as defined in this section . The 6 person wagering shall acquire an interest in the total money 7 wagered on all horses or dogs in the race as first winners in 8 proportion to the amount of money wagered by the person. 9 4. The licensee shall issue to each person wagering a 10 certificate on which shall be shown the number of the race, 11 the amount wagered, and the number or name of the horse or dog 12 selected as first winner. 13 5. As each race is run the licensee shall deduct sixteen 14 percent from the total sum wagered on all horses or dogs as 15 first winners. However, the commission shall authorize at 16 the request of the licensee a deduction of a higher or lower 17 percentage of the total sum wagered not to exceed eighteen 18 percent and the additional deduction shall be retained by the 19 licensee. The balance, after deducting breakage, shall be paid 20 to the holders of certificates on the winning horse or dog in 21 the proportion that the amount wagered by each certificate 22 holder bears to the total amount wagered on all horses or 23 dogs in the race as first winners. The licensee may pay a 24 larger amount if approved by the commission. The licensee 25 shall likewise receive other wagers on horses or dogs in places 26 or combinations the commission may authorize. The method, 27 procedure, and the authority and right of the licensee, as well 28 as the deduction allowed to the licensee, shall be as specified 29 with respect to wagers upon horses or dogs selected to run 30 first. However, the commission shall authorize at the request 31 of the licensee a deduction of a higher or lower percent of 32 the total sum wagered not to exceed twenty-four percent on 33 multiple or exotic wagering involving not more than two horses 34 or dogs . The deduction authorized above twenty percent on 35 -8- LSB 5651SV (2) 91 ss/ns 8/ 21

S.F. 2295 the multiple or exotic wagering involving not more than two 1 dogs or horses shall be retained by the licensee. For exotic 2 wagering involving three or more horses or dogs , the commission 3 shall authorize at the request of the licensee a deduction of a 4 higher or lower percent of the total sum wagered not to exceed 5 twenty-five percent on the exotic wagers. The additional 6 deduction authorized above twenty-two percent on the multiple 7 or exotic wagers involving more than two horses or dogs 8 shall be retained by the licensee. One percent of the exotic 9 wagers on three or more horses or dogs shall be distributed as 10 provided in section 99D.12 . 11 Sec. 17. Section 99D.11, subsection 6, paragraph b, 12 subparagraphs (1) and (2), Code 2026, are amended to read as 13 follows: 14 (1) The commission may authorize the licensee to 15 simultaneously telecast within the racetrack enclosure or at 16 the facility of a licensee authorized to operate an excursion 17 gambling boat or gambling structure under chapter 99F , for 18 the purpose of pari-mutuel wagering, a horse or dog race 19 licensed by the racing authority of another state or foreign 20 jurisdiction. It is the responsibility of each licensee to 21 obtain the consent of appropriate racing officials in other 22 states as required by the federal Interstate Horseracing Act of 23 1978, 15 U.S.C. §3001 – 3007, to televise races for the purpose 24 of conducting pari-mutuel wagering. 25 (2) A licensee may also obtain the permission of a person 26 licensed by the commission to conduct horse or dog races in 27 this state to televise races conducted by that person for 28 the purpose of conducting pari-mutuel wagering. However, 29 arrangements made by a licensee to televise any race for the 30 purpose of conducting pari-mutuel wagering are subject to the 31 approval of the commission, and the commission shall select the 32 races to be televised. The races selected by the commission 33 shall be the same for all licensees approved by the commission 34 to televise races for the purpose of conducting pari-mutuel 35 -9- LSB 5651SV (2) 91 ss/ns 9/ 21

S.F. 2295 wagering. Except for a licensee that is not obligated to 1 schedule performances of live races pursuant to section 99D.9A , 2 or a licensee issued a license subject to the requirements 3 of section 99D.9C , the commission shall not authorize the 4 simultaneous telecast or televising of and a licensee shall 5 not simultaneously telecast or televise any horse or dog race 6 for the purpose of conducting pari-mutuel wagering unless the 7 simultaneous telecast or televising is done at the racetrack of 8 a licensee that schedules no less than sixty performances of 9 nine live races each day of the season. 10 Sec. 18. Section 99D.12, Code 2026, is amended to read as 11 follows: 12 99D.12 Breakage. 13 A licensee shall deduct the breakage from the pari-mutuel 14 pool which shall be distributed to the breeders of Iowa-foaled 15 horses and Iowa-whelped dogs in the manner described in section 16 99D.22 . The remainder of the breakage shall be distributed as 17 follows: 18 1. In horse races the breakage shall be retained by 19 the licensee to supplement purses for races restricted to 20 Iowa-foaled horses or to supplement purses won by Iowa-foaled 21 horses by finishing first, second, third, or fourth in any 22 other race. The purse supplements will be paid in proportion 23 to the purse structure of the race. Two percent shall be 24 deposited by the commission into a special fund to be known 25 as the horse racing promotion fund. The commission each year 26 shall approve a nonprofit organization to use moneys in the 27 fund for research, education, and marketing of horse racing in 28 the state, including public relations, and other promotional 29 techniques. The nonprofit organization shall not engage in 30 political activity. It shall be a condition of the allocation 31 of funds that any organization receiving funds shall not expend 32 the funds on political activity or on any attempt to influence 33 legislation. 34 2. In dog races the breakage shall be distributed as 35 -10- LSB 5651SV (2) 91 ss/ns 10/ 21

S.F. 2295 follows: 1 a. Seventy-three percent shall be retained by the licensee 2 to supplement purses for races won by Iowa-whelped dogs as 3 provided in section 99D.22 . 4 b. Twenty-five percent shall be retained by the licensee 5 and shall be put into a stake race for Iowa-whelped dogs. An 6 amount equal to twelve percent of the winner’s share shall 7 be set aside and distributed to the breeder of the winning 8 greyhound in accordance with section 99D.22 and the remainder 9 shall be apportioned as purse moneys for the stake race. All 10 dogs racing in the stake race must have run in at least twelve 11 races during the current racing season at the track sponsoring 12 the stake race to qualify to participate. 13 c. Two percent shall be deposited by the commission into a 14 special fund to be known as the dog racing promotion fund. The 15 commission each year shall approve a nonprofit organization to 16 use moneys in the fund for research, education, and marketing 17 of dog racing in the state, including public relations, and 18 other promotional techniques. The nonprofit organization shall 19 not engage in political activity. It shall be a condition of 20 the allocation of funds that any organization receiving funds 21 shall not expend the funds on political activity or on any 22 attempt to influence legislation. 23 Sec. 19. Section 99D.13, subsection 2, Code 2026, is amended 24 to read as follows: 25 2. Winnings from each racetrack forfeited under subsection 26 1 shall escheat to the state and to the extent appropriated 27 by the general assembly shall be used by the department of 28 agriculture and land stewardship to administer section 99D.22 . 29 The remainder shall be paid over to the commission to pay all 30 or part of the cost of drug testing at the tracks. To the 31 extent the remainder paid over to the commission, less the cost 32 of drug testing, is from unclaimed winnings from harness race 33 meetings, the remainder shall be used as provided in subsection 34 3 . To the extent the remainder paid to the commission, less 35 -11- LSB 5651SV (2) 91 ss/ns 11/ 21

S.F. 2295 the cost of drug testing, is from unclaimed winnings from 1 licensed dog tracks, the commission shall remit annually five 2 thousand dollars, or an equal portion of that amount, to each 3 licensed dog track to carry out the racing dog adoption program 4 pursuant to section 99D.27 . To the extent the remainder paid 5 over to the commission, less the cost of drug testing, is from 6 unclaimed winnings from tracks licensed for dog or horse races, 7 the commission, on an annual basis, shall remit one-third of 8 the amount to the treasurer of the city in which the racetrack 9 is located, one-third of the amount to the treasurer of the 10 county in which the racetrack is located, and one-third of 11 the amount to the racetrack from which it was forfeited. If 12 the racetrack is not located in a city, then one-third shall 13 be deposited as provided in chapter 556 . The amount received 14 by the racetrack under this subsection shall be used only for 15 retiring the debt of the racetrack facilities and for capital 16 improvements to the racetrack facilities. 17 Sec. 20. Section 99D.14, subsections 3 and 5, Code 2026, are 18 amended to read as follows: 19 3. The licensee shall also pay to the commission a licensee 20 fee of two hundred dollars for each racing day of each 21 horse-race or dog-race meeting for which a license has been 22 issued. 23 5. No other excise tax shall be levied, assessed, or 24 collected from the licensee on horse racing, dog racing, 25 pari-mutuel wagering , or admission charges by the state or by a 26 political subdivision, except as provided in this chapter . 27 Sec. 21. Section 99D.15, subsection 4, Code 2026, is amended 28 to read as follows: 29 4. A tax is imposed on the gross sum wagered by the 30 pari-mutuel method on horse races and dog races which are 31 simultaneously telecast, in lieu of the taxes imposed pursuant 32 to subsection 1 or 3 . The rate of tax is determined as follows: 33 a. If wagering on simultaneously telecast horse races and 34 dog races is not conducted by a licensee under section 99D.9D , 35 -12- LSB 5651SV (2) 91 ss/ns 12/ 21

S.F. 2295 a tax of two percent is imposed on the gross sum wagered by 1 the pari-mutuel method on horse races and dog races which are 2 simultaneously telecast. The tax revenue from simulcast horse 3 races under this paragraph shall be distributed as provided in 4 subsection 1 and the tax revenue from simulcast dog races under 5 this paragraph shall be distributed as provided in subsection 6 3 . 7 b. If wagering on simultaneously telecast horse races and 8 dog races is conducted by a licensee under section 99D.9D , 9 a tax of two percent is imposed on the gross sum wagered by 10 the pari-mutuel method on horse races and dog races which 11 are simultaneously telecast in excess of twenty-five million 12 dollars in a calendar year. The tax revenue from simulcast 13 horse races under this paragraph shall be deposited in the Iowa 14 horse racing fund created in section 99D.27B . The remaining 15 amount of tax revenue shall be deposited with the commission. 16 Sec. 22. Section 99D.20, Code 2026, is amended to read as 17 follows: 18 99D.20 Audit of licensee operations. 19 Within ninety days after the end of each calendar year, 20 the licensee , including a licensee issued a license subject 21 to the requirements of section 99D.9C , shall transmit to 22 the commission an audit of the financial transactions and 23 condition of the licensee’s operations conducted under this 24 chapter . Additionally, within ninety days after the end of 25 the licensee’s fiscal year, the licensee shall transmit to 26 the commission an audit of the licensee’s total racing and 27 gaming operations, including an itemization of all expenses and 28 subsidies. All audits shall be conducted by certified public 29 accountants authorized to practice in the state of Iowa under 30 chapter 542 who are selected by the board of supervisors of the 31 county in which the licensee operates. 32 Sec. 23. Section 99D.22, subsection 1, paragraph a, 33 subparagraph (1), Code 2026, is amended to read as follows: 34 (1) A licensee shall hold at least one race on each racing 35 -13- LSB 5651SV (2) 91 ss/ns 13/ 21

S.F. 2295 day limited to Iowa-foaled horses or Iowa-whelped dogs as 1 defined by the department of agriculture and land stewardship 2 using standards consistent with this section . However, if 3 sufficient competition cannot be had among that class of 4 horses or dogs on any day, another race for the day may be 5 substituted. 6 Sec. 24. Section 99D.22, subsection 1, paragraph b, Code 7 2026, is amended to read as follows: 8 b. A sum equal to twelve percent of the purse won by an 9 Iowa-foaled horse or Iowa-whelped dog shall be used to promote 10 the horse and dog breeding industries industry . The twelve 11 percent shall be withheld by the licensee from the breakage 12 and shall be paid at the end of the race meeting to the state 13 department of agriculture and land stewardship which in turn 14 shall deposit it in a special fund to be known as the Iowa horse 15 and dog breeders fund. The department shall pay the amount 16 deposited in the fund that is withheld from the purse won by 17 an Iowa-foaled horse to the breeder of the winning Iowa-foaled 18 horse by December 31 of each calendar year. The department 19 shall pay the amount deposited in the fund that is withheld 20 from the purse won by an Iowa-whelped dog to the breeder of the 21 winning Iowa-whelped dog by March 31 of each calendar year. 22 For the purposes of this section , the breeder of a horse shall 23 be considered to be the owner of the brood mare at the time the 24 foal is dropped. 25 Sec. 25. Section 99D.22, subsections 4 and 5, Code 2026, are 26 amended by striking the subsections. 27 Sec. 26. Section 99D.23, subsection 2, Code 2026, is amended 28 to read as follows: 29 2. The commission shall employ or contract with one or 30 more veterinarians to extract or procure the saliva, urine, 31 blood, hair, or other excretions or body fluids of the horses 32 or dogs for the chemical testing purposes of this section . A 33 commission veterinarian shall be in attendance at every race 34 meeting held in this state. 35 -14- LSB 5651SV (2) 91 ss/ns 14/ 21

S.F. 2295 Sec. 27. Section 99D.24, subsection 5, paragraphs a and b, 1 Code 2026, are amended to read as follows: 2 a. Uses, possesses, or conspires to use or possess a 3 device other than the ordinary whip or spur for the purpose 4 of stimulating or depressing a horse or dog during a race or 5 workout. 6 b. Sponges a horse’s or dog’s nostrils or windpipe or 7 uses any method, injurious or otherwise, for the purpose of 8 stimulating or depressing a horse or dog or affecting its speed 9 in a race or a workout. 10 Sec. 28. Section 99D.24, subsection 6, Code 2026, is amended 11 to read as follows: 12 6. A person commits a serious misdemeanor if the person has 13 in the person’s possession within the confines of a racetrack, 14 stable, shed, building or grounds, or within the confines of 15 a stable, shed, building or grounds where a horse or dog is 16 kept which is eligible to race over a racetrack licensed under 17 this chapter , an appliance other than the ordinary whip or spur 18 which can be used for the purpose of stimulating or depressing 19 a horse or dog or affecting its speed at any time. 20 Sec. 29. Section 99D.25, subsection 1, paragraphs a, b, and 21 c, Code 2026, are amended to read as follows: 22 a. “Drugging” means administering to a horse or dog any 23 substance foreign to the natural horse or dog prior to the 24 start of a race. However, in counties with a population 25 of two hundred fifty thousand or more, “drugging” does not 26 include administering to a horse the drugs furosemide and 27 phenylbutazone in accordance with section 99D.25A and rules 28 adopted by the commission. 29 b. “Numbing” means the applying of a freezing device or 30 substance to the limbs of a horse or dog within two hours 31 before the start of a race, or a surgical or other procedure 32 which was, at any time, performed in which the nerves of a 33 horse or dog were severed, destroyed, injected, or removed. 34 For purposes of this paragraph, ice is not a freezing device 35 -15- LSB 5651SV (2) 91 ss/ns 15/ 21

S.F. 2295 or substance. 1 c. “Entered” means that a horse or dog has been registered 2 as a participant in a specified race, and not withdrawn prior 3 to presentation of the horse or dog for inspection and testing. 4 Sec. 30. Section 99D.25, subsections 2, 3, and 4, Code 2026, 5 are amended to read as follows: 6 2. The general assembly finds that the practice of drugging 7 or numbing a horse or dog prior to a race does all of the 8 following : 9 a. Corrupts the integrity of the sport of racing and 10 promotes criminal fraud in the sport ; . 11 b. Misleads the wagering public and those desiring to 12 purchase a horse or dog as to the condition and ability of the 13 horse or dog; . 14 c. Poses an unreasonable risk of serious injury or death 15 to the rider of a horse and to the riders of other horses 16 competing in the same race ; and . 17 d. Is cruel and inhumane to the horse or dog so drugged or 18 numbed. 19 3. The following conduct is prohibited: 20 a. The entering of a horse or dog in a race by the trainer 21 or owner of the horse or dog if the trainer or owner knows or if 22 by the exercise of reasonable care the trainer or owner should 23 know that the horse or dog is drugged or numbed ; . 24 b. The drugging or numbing of a horse or dog with knowledge 25 or with reason to believe that the horse or dog will compete 26 in a race while so drugged or numbed. However, the commission 27 may by rule establish permissible trace levels of substances 28 foreign to the natural horse or dog that the commission 29 determines to be innocuous ; . 30 c. The willful failure by the operator of a racing facility 31 to disqualify a horse or dog from competing in a race if the 32 operator has been notified that the horse or dog is drugged 33 or numbed, or was not properly made available for tests or 34 inspections as required by the commission ; and . 35 -16- LSB 5651SV (2) 91 ss/ns 16/ 21

S.F. 2295 d. The willful failure by the operator of a racing facility 1 to prohibit a horse or dog from racing if the operator has been 2 notified that the horse or dog has been suspended from racing. 3 4. The owners of a horse or dog and their agents and 4 employees shall permit a member of the commission or a person 5 employed or appointed by the commission to make tests as the 6 commission deems proper in order to determine whether a horse 7 or dog has been improperly drugged. The fact that purse money 8 has been distributed prior to the issuance of a test report 9 shall not be deemed a finding that no chemical substance has 10 been administered unlawfully to the horse or dog earning the 11 purse money. The findings of the commission that a horse or 12 dog has been improperly drugged by a narcotic or other drug are 13 prima facie evidence of the fact. The results of the tests 14 shall be kept on file by the commission for at least one year 15 following the tests. 16 Sec. 31. Section 99F.1, subsection 27, Code 2026, is amended 17 to read as follows: 18 27. “Racetrack enclosure” means all real property utilized 19 for the conduct of a race meeting, including the racetrack, 20 grandstand, concession stands, offices, barns, kennels and 21 barn areas, employee housing facilities, parking lots, and 22 any additional areas designated by the commission. “Racetrack 23 enclosure” also means all real property utilized by a licensee 24 under chapter 99D who is not required to conduct live racing 25 pursuant to the requirements of section 99D.9A , on which 26 pari-mutuel wagering on simultaneously telecast horse or dog 27 races may be conducted and lawful gambling is authorized and 28 licensed as provided in this chapter . 29 Sec. 32. Section 99F.2, Code 2026, is amended to read as 30 follows: 31 99F.2 Scope of provisions. 32 This chapter does not apply to the pari-mutuel system of 33 wagering used or intended to be used in connection with the 34 horse-race or dog-race meetings as authorized under chapter 35 -17- LSB 5651SV (2) 91 ss/ns 17/ 21