15 U.S.C. § 3052 — Recognition of the Horseracing Integrity and Safety Authority

(a) In general The private, independent, self-regulatory, nonprofit corporation, to be known as the “Horseracing Integrity and Safety Authority^*”, is recognized for purposes of developing and implementing a horseracing anti-doping and medication control program^* and a racetrack safety program^* for covered horses, covered persons^*, and covered horseraces.

(b) Board of directors (1) Membership The Authority must be governed by a board of directors (in this section referred to as the “Board”) comprised of nine members as follows: (A) Independent members Five members of the Board must be independent members selected from outside the equine industry. (B) Industry members

(i) In general Four members of the Board must be industry members selected from among the various equine constituencies^*. (ii) Representation of equine constituencies The industry members must be representative of the various equine constituencies, and must include not more than one industry member from any one equine constituency. (2) Chair The chair of the Board must be an independent member described in paragraph (1)(A). (3) Bylaws The Board of the Authority must be governed by bylaws for the operation of the Authority about — (A) the administrative structure and employees of the Authority; (B) the establishment of standing committees; (C) the procedures for filling vacancies on the Board and the standing committees; (D) term limits for members and termination of membership; and (E) any other matter the Board considers necessary.

(c) Standing committees (1) Anti-doping and medication control standing committee (A) In general The Authority must establish an anti-doping and medication control standing committee, which must provide advice and guidance to the Board on the development and maintenance of the horseracing anti-doping and medication control program. (B) Membership The anti-doping and medication control standing committee must be comprised of seven members as follows:

(i) Independent members A majority of the members must be independent members selected from outside the equine industry. (ii) Industry members A minority of the members must be industry members selected to represent the various equine constituencies, and must include not more than one industry member from any one equine constituency. (iii) Qualification A majority of individuals selected to serve on the anti-doping and medication control standing committee must have significant, recent experience in anti-doping and medication control rules. (C) Chair The chair of the anti-doping and medication control standing committee must be an independent member of the Board described in subsection (b)(1)(A). (2) Racetrack^* safety standing committee (A) In general The Authority must establish a racetrack safety standing committee, which must provide advice and guidance to the Board on the development and maintenance of the racetrack safety program. (B) Membership The racetrack safety standing committee must be comprised of seven members as follows:

(i) Independent members A majority of the members must be independent members selected from outside the equine industry. (ii) Industry members A minority of the members must be industry members selected to represent the various equine constituencies. (C) Chair The chair of the racetrack safety standing committee must be an industry member of the Board described in subsection (b)(1)(B).

(d) Nominating committee (1) Membership (A) In general The nominating committee of the Authority must be comprised of seven independent members selected from business, sports, and academia. (B) Initial membership The initial nominating committee members must be set forth in the governing corporate documents of the Authority. (C) Vacancies After the initial committee members are appointed under subparagraph (B), vacancies must be filled by the Board under rules established by the Authority. (2) Chair The chair of the nominating committee must be selected by the nominating committee from among the members of the nominating committee. (3) Selection of members of the Board and standing committees (A) Initial members The nominating committee must select the initial members of the Board and the standing committees described in subsection (c). (B) Subsequent members The nominating committee must recommend individuals to fill any vacancy on the Board or on such standing committees.

(e) Conflicts of interest To avoid conflicts of interest, the following individuals may not be selected as a member of the Board or as an independent member of a nominating or standing committee under this section: (1) An individual who has a financial interest in, or provides goods or services to, covered horses. (2) An official or officer — (A) of an equine industry representative^*; or (B) who serves in a governance or policymaking capacity for an equine industry representative. (3) An employee of, or an individual who has a business or commercial relationship with, an individual described in paragraph (1) or (2). (4) An immediate family member^* of an individual described in paragraph (1) or (2).

(f) Funding (1) Initial funding (A) In general Initial funding to establish the Authority and underwrite its operations before the program effective date^* must be provided by loans obtained by the Authority. (B) Borrowing The Authority may borrow funds toward the funding of its operations. (C) Annual calculation of amounts required

(i) In general Not later than the date that is 90 days before the program effective date, and by November 1 each year thereafter, the Authority must determine and provide to each State racing commission^* the estimated amount required from the State — (I) to fund the State’s proportionate share of the horseracing anti-doping and medication control program and the racetrack safety program for the next calendar year; and (II) to liquidate the State’s proportionate share of any loan or funding shortfall in the current calendar year and any previous calendar year. (ii) Basis of calculation The amounts calculated under clause

(i) must — (I) be based on — (aa) the annual budget of the Authority for the following calendar year, as approved by the Board; and (bb) the projected amount of covered racing starts for the year in each State; and (II) take into account other sources of Authority revenue. (iii) Requirements regarding budgets of Authority (I) Initial budget The initial budget of the Authority must require the approval of ⅔ of the Board. (II) Subsequent budgets Any subsequent budget that exceeds the budget of the preceding calendar year by more than 5 percent must require the approval of ⅔ of the Board. (iv) Rate increases (I) In general A proposed increase in the amount required under this subparagraph must be reported to the Commission^*. (II) Notice and comment The Commission must publish in the Federal Register such a proposed increase and provide an opportunity for public comment. (2) Assessment and collection of fees by States (A) Notice of election Any State racing commission that elects to remit fees under this subsection must notify the Authority of such election by 60 days before the program effective date. (B) Requirement to remit fees After a State racing commission makes a notification under subparagraph (A), the election must remain in effect and the State racing commission must be required to remit fees under this subsection according to a schedule established in rule developed by the Authority and approved by the Commission. (C) Withdrawal of election A State racing commission may cease remitting fees under this subsection not earlier than one year after notifying the Authority of the intent of the State racing commission to do so. (D) Determination of methods Each State racing commission must determine, subject to the applicable laws, regulations, and contracts of the State, the method by which the requisite amount of fees, such as foal registration fees, sales contributions, starter fees, and track fees, and other fees on covered persons, must be allocated, assessed, and collected. (3) Assessment and collection of fees by the Authority (A) Calculation If a State racing commission does not elect to remit fees under paragraph (2) or withdraws its election under such paragraph, the Authority must, not less frequently than monthly, calculate the applicable fee per racing start multiplied by the number of racing starts in the State during the preceding month. (B) Allocation The Authority must allocate equitably the amount calculated under subparagraph (A) collected among covered persons involved with covered horseraces under such rules as the Authority may promulgate. (C) Assessment and collection

(i) In general The Authority must assess a fee equal to the allocation made under subparagraph (B) and must collect such fee according to such rules as the Authority may promulgate. (ii) Remittance of fees Covered persons described in subparagraph (B) must be required to remit such fees to the Authority. (D) Limitation A State racing commission that does not elect to remit fees under paragraph (2) or that withdraws its election under such paragraph must not impose or collect from any person a fee or tax relating to anti-doping and medication control or racetrack safety matters for covered horseraces. (4) Fees and fines Fees and fines imposed by the Authority must be allocated toward funding of the Authority and its activities. (5) Rule of construction Nothing in this chapter must be construed to require — (A) the appropriation of any amount to the Authority; or (B) the Federal Government to guarantee the debts of the Authority.

(g) Quorum For all items where Board approval is required, the Authority must have present a majority of independent members.