The Commission may authorize a licensee to hold racing with pari-mutuel betting.

A licensee may not lend or give money to a person for pari-mutuel betting. The Commission may adopt regulations to enforce this section.

If a winning ticket is not redeemed within 1 year, the licensee into whose betting pool the bet was placed shall pay the amount needed to redeem the ticket to the Commission to be credited to the Special Fund under Subtitle 4 of this title. Every year for the preceding calendar year, each licensee shall: report to the Commission the amount payable to the Commission under this section; and pay that amount to the Commission. The license of a licensee shall be revoked if the licensee: fails to report when money under this section is due; or knowingly or willfully submits a report that understates the amount due. A licensee whose license is revoked under this subsection may not hold a license for at least 1 year.

The intent of this section is similar to that of the Interstate Horseracing Act of 1978, 15 U.S.C. §§ 3001 through 3007. If the Commission approves, a licensee may contract to hold pari-mutuel betting on a race that is held at an out-of-state track where betting on racing is lawful. Pari-mutuel betting under this section may only occur: on a racing day when the Commission has authorized the licensee to hold racing; and at the track of the licensee; at any track where pari-mutuel betting on races on the racing program of the licensee for that day is authorized; or at a satellite simulcast facility. The breakage and takeout for pari-mutuel betting under this section shall be computed in the way normally applicable to pari-mutuel betting on racing the licensee holds. From the takeout the licensee shall deduct: the State tax on all mutuel pools; the amount to be paid under the contract to the out-of-state track; and the cost of transmission. The licensee shall then allocate the rest of the takeout in the way applicable to the racing that the licensee holds. A contract with an out-of-state track under this section is subject to the approval of the group that represents a majority of the owners and trainers who race horses at that track and the group that represents a majority of the applicable breeders in this State.

Subject to the Interstate Horseracing Act of 1978, 15 U.S.C. §§ 3001 through 3007, a licensee may simulcast races held in this State to another jurisdiction where betting on racing is lawful. All payments to the licensee under this section shall be allocated to the licensee, purses, and the applicable bred fund in the way agreed to by: the licensee; the group that represents a majority of the applicable owners and trainers licensed in the State; and the group that represents a majority of the applicable breeders in the State.

Notwithstanding § 11-804(c) of this subtitle, a licensee in Allegany County may conduct pari-mutuel betting under § 11-804 of this subtitle on a day when the Commission has authorized the licensee to hold racing only: at the track of the licensee; at a satellite simulcast facility: in which the licensee has majority ownership interest; and which complies with the requirements of § 11-825(a) of this subtitle; and at a receiving track located more than 35 miles from any of Laurel Park, Pimlico Race Course, and Rosecroft Raceway.

Except for racing held by the Maryland-National Capital Park and Planning Commission, the Commission may authorize telephone betting at any track where racing is authorized. The breakage and takeout on all telephone betting shall be computed in the way normally applicable to pari-mutuel betting on racing the licensee holds.

An employee of a receiving track is not considered an employee of the sending track because of this part. The Commission has jurisdiction over all intertrack betting and other activities at a receiving track to the same extent as when live racing is held at the track. The Commission shall adopt regulations to carry out this part. Only a licensee may operate a receiving track or a sending track. A receiving track shall transmit directly to the sending track all pari-mutuel information about the money bet at the receiving track. A sending track shall incorporate this information with information on pari-mutuel betting at the sending track. Money bet in intertrack betting shall be: included in the applicable mutuel pools at the sending track; and considered as if bet at the sending track. The breakage, State tax, and takeout on all intertrack betting at a receiving track shall be computed in the way normally applicable to pari-mutuel betting on a race at the sending track. The takeout shall be allocated in the same proportions that are normally applicable to racing held at the sending track, after deductions for: the State tax; the amount to be kept by the receiving track under the simulcast agreement with the sending track; and the cost to the sending track of the transmission.

On a race that a licensee holds and simulcasts to an out-of-state facility or on a simulcast of a race that a licensee receives, the licensee may, with the approval of the Commission, combine bets made at the licensee’s track with bets of the same type made at the out-of-state facility where betting is lawful. This section allows the creation of common mutuel pools for calculating odds and determining payouts. Bets made at an out-of-state facility may not be considered part of the licensee’s mutuel pools for any purpose other than the purpose stated in subsection (b) of this section. For races that are held by a licensee in this State and simulcast to an out-of-state facility, the takeout on bets made in this State that are commingled in a common mutuel pool shall be the takeout as prescribed for the licensee by this title. Notwithstanding any other provision of this title governing the amount of takeout, for a race that is held by an out-of-state facility and simulcast to a licensee in this State, the takeout on bets made in this State that are commingled in a common mutuel pool shall be, subject to the approval of the Commission, as agreed by the licensee and the out-of-state facility. Notwithstanding any other provision of this title governing the allocation of takeout, for a race that is held by an out-of-state facility and simulcast to a licensee in this State, the allocation of takeout on bets made in this State that are commingled in a common mutuel pool shall be, subject to the approval of the Commission, allocated in the following manner: to the State for taxes on the handle of the licensee as provided under this title; to the host racing association where live racing is conducted in an amount determined by the licensee and the out-of-state facility; and the remainder to the licensee, the applicable pension funds created by this title, purse money, and the applicable bred fund in proportion to their respective shares of the takeout under this title.

In this section the following words have the meanings indicated. “Fair Hill” means the Cecil County Breeders’ Fair, Inc., or its successor. “State Fair Society” means the Maryland State Fair and Agricultural Society, Inc. This section applies only to intertrack betting in which: the sending track is equipped to transmit simulcast races and is: a mile thoroughbred track; a harness track; a track where racing is conducted by Fair Hill; or a track where racing is conducted by the State Fair Society; and the receiving track is: equipped to receive simulcast races and hold intertrack betting on those races; and one of the tracks specified in item (1) of this subsection. The Commission may authorize intertrack betting involving tracks of: mile thoroughbred racing licensees; harness racing licensees; Fair Hill; or the State Fair Society. The Commission may authorize licensees, Fair Hill, or the State Fair Society to participate in intertrack betting by operating sending tracks and receiving tracks only if: the operators of the sending track and the receiving track submit a joint application to the Commission; the Commission holds a public hearing on the matter; the operator of the receiving track shows to the satisfaction of the Commission that the operator has held, is holding, or will hold regularly scheduled race meetings at the receiving track in accordance with a license and has complied with the terms of the license; and the receiving track meets the requirements of subsection (e) of this section, unless the Commission has waived them, and subsection (f) of this section. Laurel Race Course, a track where racing is conducted by the State Fair Society or Rosecroft Raceway may be a receiving track only if live racing was held there in the previous calendar year on at least 75% of the racing days available to it. Ocean Downs may be a receiving track only if at least 40 days of live racing were held there in the previous calendar year. Pimlico Race Course may be a receiving track only if at least 90 days of live racing were held there in the previous calendar year. A track where racing is conducted by Fair Hill may be a sending track only on days when Fair Hill is licensed to conduct and actually conducts live racing. A track in Allegany County may be a sending track: to any receiving track: on days when the track is licensed to conduct and actually conducts live racing; and for live races conducted at the track; and to a receiving track located more than 35 miles from any of Laurel Park, Pimlico Race Course, and Rosecroft Raceway: on any day the Commission has authorized the licensee to hold racing; and for simulcast races conducted at the track. Subject to § 11-804.2 of this subtitle, nothing in paragraph (5) of this subsection shall limit the ability of a track in Allegany County to act as a sending track to a satellite simulcast facility. A track in Allegany County may be a receiving track: during its opening year if it has scheduled at least 21 days of live racing within 12 months of its opening and the Commission has granted its application to race on those days; and in subsequent years if at least 21 days of live racing were held at the track in the previous calendar year. The Commission may waive a requirement of this subsection if the receiving track could not meet the requirement because of: an act of God; or what the Commission finds to be an emergency. Intertrack betting may be held only if the organizations specified in this subsection approve the agreement between the receiving track and the sending track to simulcast races. If the sending track is a mile thoroughbred track or a track where racing is conducted by the State Fair Society or Fair Hill, approval shall be by an organization representing: a majority of the owners and trainers at the sending track; and a majority of the thoroughbred breeders in the State. If the sending track is a harness track, approval shall be by an organization representing: a majority of the owners, trainers, and drivers of standardbred horses at the sending track; and a majority of the standardbred breeders in the State. If the receiving track is a mile thoroughbred track or a track where racing is conducted by the State Fair Society, approval shall be by an organization representing: a majority of the owners and trainers at the receiving track; and a majority of the thoroughbred breeders in the State. If the receiving track is a harness track, approval shall be by an organization representing: a majority of the owners, trainers, and drivers of standardbred horses at the harness track; and a majority of the standardbred breeders in the State. The simulcast signal shall be encoded. The licensee of the receiving track may not transmit the simulcast signal beyond the premises where pari-mutuel betting is allowed. Notwithstanding the provisions of subsection (f) of this section, if a track where racing is conducted by the State Fair Society is within the 35-mile radius of a mile thoroughbred track, it shall first obtain the concurrence of that mile thoroughbred track before it may be a receiving track during a period of time when the State Fair Society is not licensed to conduct live racing.

A mile thoroughbred racing licensee operating a sending track shall pay to the Commission, within 10 days after each day of intertrack betting on thoroughbred racing at a receiving track, $1,000 of the impact aid to be paid to political subdivisions for intertrack betting for that day under § 11–404(c) and (d) of this title. The licensee shall deduct from the takeout the payment under subsection (a) of this section and then shall allocate the rest of the takeout in the way normally applicable to racing at the sending track. The Commission shall pay promptly to the Comptroller all money collected under this section.

In this part the following words have the meanings indicated. “Permit” means a permit granted under this part to hold satellite simulcast betting. “Satellite simulcast betting” means: pari-mutuel betting at a satellite simulcast facility in the State on a race that is simulcast from a sending track by a mile thoroughbred racing licensee, a harness racing licensee, or the State Fair Society; and transmission of the pari-mutuel information regarding bets at the satellite simulcast facility to the sending track.

The Commission may approve satellite simulcast facilities that may conduct satellite simulcast betting. This part does not authorize satellite simulcast betting at or through the direct use of lottery terminals in the State. The Commission has jurisdiction over all satellite simulcast betting and other activities at a satellite simulcast facility to the same extent as when live racing is held by a licensee.

A person must have a permit granted by the Commission whenever the person holds satellite simulcast betting. Except as provided in paragraph (2) of this subsection, nothing in this Part III of this subtitle may preempt local zoning laws or ordinances. The use of a facility for satellite simulcast betting is not required to be submitted to or approved by any county or municipal zoning board, authority, or unit if the facility is properly zoned and operating for the following activities: operation of a video lottery facility; operation of a sports wagering facility; or operation of electronic bingo or electronic tip jar machines.

Any person may apply for a permit. An applicant for a permit shall submit to the executive director of the Commission an application in the form that the Commission requires. Except as provided in subsection (e) of this section, the Commission shall conduct a personal and financial background check of an applicant for a permit including: a review, by a certified public accountant, of the certified financial statements of the applicant, including contingent or pledged liabilities, sufficient to determine the ability of the applicant to purchase or lease, and develop and maintain the satellite simulcast facility for which the permit is sought; an income statement of the applicant for the most recent year; a statement of financial and related records of any person in which the applicant has at least a majority interest; a disclosure of all financial interests in horse racing and any other legalized betting activity; the disclosure of each person who is a beneficial owner of the applicant; with the assistance of federal, State, and local law enforcement authorities, a criminal background review; and a character review. The Commission shall adopt regulations establishing uniform procedures for conducting the personal and financial background check required by this section. The Commission may waive all or any portion of the review that it determines to be appropriate for any applicant that is: a licensee; a video lottery operation licensee under Title 9, Subtitle 1A of the State Government Article; or a sports wagering facility licensee under Title 9, Subtitle 1E of the State Government Article.

The factors that the Commission shall consider in deciding whether to grant a permit shall include: the needs and convenience of the public; whether the satellite simulcast facility: would be expected to interfere unreasonably with attendance at tracks; and meets the requirements of § 11–825(a) of this subtitle; the desires of the political subdivision where the proposed satellite simulcast facility is to be located; the interests of the racing industry; and other matters that the Commission finds appropriate. Before granting a permit, the Commission shall: hold a public hearing within 10 miles of the proposed satellite simulcast facility; advertise the date, time, and location of the public hearing in a local publication at least 30 days before the public hearing; provide written notice of the date, time, and location of the public hearing to each of the Senators, Delegates, and county–elected officials that represent the jurisdiction within which the proposed satellite simulcast betting facility is to be located; post notice of the public hearing on the Commission’s Web site at least 30 days before the public hearing; require the applicant, at least 30 days before the public hearing, to post a sign in a conspicuous location at the facility for which the application for the permit was submitted stating that an application is pending for use of the facility for satellite simulcast betting and specifying the date, time, and location of the public hearing; and request from the applicant a list of community associations that were notified of the public hearing.

The Commission shall grant a permit to each applicant whose application the Commission approves after the applicant pays the permit fee that the Commission requires. A permit shall state the specific location where the permit applies. If the Commission approves, an applicant for a permit may change the location for which a satellite simulcast facility is being applied.

A permit entitles the holder to hold satellite simulcast betting at the satellite simulcast facility specified in the permit, but does not give the permit holder an ownership right to the permit or the simulcast signal.

The Commission shall set the term of each permit. If the Commission approves, a permit may be transferred to another person if: the satellite simulcasting facility remains at the same location; and the person complies with all regulations of the Commission established under § 11-316 of this title for the purchase or transfer of an entity licensed to conduct racing.

A permit holder shall keep records of ownership and submit annual reports of ownership as required under § 11-314 of this title.

Applicants for and holders of permits are subject to the denial of license and disciplinary provisions of § 11-308 of this title.

A satellite simulcast facility: shall be in premises owned or leased by a permit holder; may not be within a 35–mile radius of any mile thoroughbred track or harness track unless approved by the track licensee, the group that represents a majority of the applicable owners and trainers licensed in the State and the group that represents a majority of the applicable breeders in the State, considered separately; unless the track agrees otherwise, may not operate during hours on those days that racing with pari–mutuel betting is permitted at a racetrack located in this State within a 35–mile radius of the satellite simulcast facility; and shall offer pari–mutuel betting facilities and amenities that the Commission finds are appropriate for the area where the satellite simulcast facility is located. A mile thoroughbred racing licensee or a harness racing licensee: shall own or lease the pari–mutuel betting equipment at a satellite simulcast facility; and except as provided in paragraph (2) of this subsection, shall, with its employees, operate the equipment. In this paragraph, “sports wagering licensee” has the meaning stated in § 9–1E–01 of the State Government Article. Subject to the approval of the Commission and the State Lottery and Gaming Control Commission: a self–service kiosk at a satellite simulcast facility that is located in a sports wagering facility may accept both satellite simulcast bets and sports wagers, provided that the kiosk separately accounts for the different types of wagers and meets all specifications and requirements established by regulation by the State Lottery and Gaming Control Commission; and a mile thoroughbred racing licensee or a harness racing licensee may enter into an agreement with a sports wagering licensee authorizing the employees of the sports wagering licensee to operate the pari–mutuel betting equipment and to accept pari–mutuel bets on horse racing in a satellite simulcast facility. A mile thoroughbred racing licensee or a harness racing licensee shall submit to the Commission all contracts and agreements relating to satellite simulcast betting under this subtitle. The Commission shall periodically be assured by permit holders that facilities continue to meet the requirements of this section. The Commission shall inspect satellite simulcast facilities at least four times each year to determine if the permit holders are continuing to comply with the provisions of this section. The inspections under this subsection shall include evaluations of the financial and physical conditions of each satellite simulcast facility. If the Commission finds that a permit holder is not complying with the provisions of this section, the Commission may impose a penalty on the permit holder similar to those penalties levied on licensees as provided under § 11–308 of this title.

All money bet at a satellite simulcast facility shall be included in the applicable mutuel pools at the sending track. Except as provided in § 11-827 of this part, the breakage, State tax, and takeout on all satellite simulcast betting shall be computed in the way normally applicable to pari-mutuel betting on a race at the sending track.

After the respective portions have been retained by each person listed below, those persons may allocate, from the takeout at the satellite simulcast facility, the costs of operating a satellite simulcast facility and holding satellite simulcast betting: the licensee of the sending track, from the licensee’s share; the group that represents a majority of the applicable owners and trainers licensed in the State, from the purse share; and the group that represents a majority of the applicable breeders in the State, from the bred fund share.

A satellite simulcast facility shall transmit directly to the sending track all pari-mutuel information about the money bet at the satellite simulcast facility. A sending track shall incorporate this information with information on pari-mutuel betting at the sending track.

Except for betting on races of national or international prominence which have been approved by the Commission, satellite simulcast betting may not be conducted: on any day other than Sunday between 1:30 a.m. and 10:00 a.m.; and between 1:30 a.m. and 11:00 a.m. on Sunday.

A permit holder under this subtitle may not lend or give money to a person for pari-mutuel betting.

The Commission shall include in its annual report to the Legislative Policy Committee of the Maryland General Assembly: the effect of satellite simulcast betting on the racing industry in the State; an appraisal of each permit holder, taking into consideration the results of inspections required under this section and any financial information that is submitted to the Commission; if any additional permit has been granted under this section: the reasons for granting the permit; and the anticipated impact of the new facility on existing permit holders and racing licensees; and if an application for a permit or permit renewal has been denied: the reasons for denying the permit or renewal; and the impact on racing licensees if the Commission denied a permit renewal application.

The Commission shall adopt regulations to: define the criteria for applicants for a satellite simulcast betting permit, which may include a nonrefundable application fee; define allowable costs of operations under § 11-827 of this part; and otherwise carry out this part.