N.J. Admin. Code § 13:74-2.5

Current through Register Vol. 56, No. 24, December 18, 2024

Section 13:74-2.5 - Progress benchmarks that must be satisfied for a horsemen's organization to maintain its acquired share of off- track wagering facilities

(a) The horsemen's organizations shall become eligible to petition the Commission to obtain the right to apply for a permit holder's forfeited share of off-track wagering facilities when the permit holder's right to appeal that forfeiture is exhausted. When the permit holder's right to appeal is exhausted, the Commission shall notify, in writing, the horsemen's organizations that are eligible to petition to obtain the right to apply. From the date of this written notice, the horsemen's organizations shall have one year to petition the Commission for the right to apply for the permit holder's forfeited share of unopened off-track wagering facilities. The petition shall include general information about the financial and managerial ability of the horsemen's organization to open and operate the remaining off-track wagering facilities in the permit holder's forfeited share. A horsemen's organization may include supplemental information and documentation in support of its petition. The Commission may request additional information before rendering a decision on the petition(s) received. The Commission will review all such petitions and determine which petitioner will be awarded the right to apply for the forfeited share. The horsemen's organization granted the right to acquire the permit holder's forfeited share must file an application pursuant to N.J.A.C. 13:74-2.2 and demonstrate to the satisfaction of the Commission that it continues to make progress on an annual calendar basis towards opening the off-track wagering facilities it has acquired in accordance with the requirements in (a)1 through 5 below, which shall commence on the date the Commission approves the petition of a horsemen's organization:

1. By December 31 of the year in which the horsemen's organization's petition is approved, the horsemen's organization must file an application for an initial license for at least one off-track wagering facility within its acquired share. This deadline may be extended, at the request of the horsemen's organization, to December 31 of the following year if the horsemen's organization's petition was approved on a date after June 30 or for other good cause shown. After filing the application for an initial off-track wagering license, the horsemen's organization shall also demonstrate compliance with each of the following requirements:

i. The applicant has submitted to the Commission all information and documentation required by N.J.A.C. 13:74-2.2;

ii. The applicant has demonstrated to the Commission that the proposed off-track wagering facility is in a suitable location and the applicant has obtained fee title ownership of the proposed property or obtained a leasehold interest in the proposed property for a period of not less than five years;

iii. The applicant has obtained sufficient financial resources to pay for the design, construction, development, and other costs necessary to establish the proposed off-track wagering facility. The applicant shall provide to the Commission, a detailed project development budget informed by a qualified professional design and construction team and documentation that the applicant has either placed monies into escrow or secured an irrevocable letter of credit in an amount equal to or greater than the project development budget; and

iv. The applicant has demonstrated to the Commission that the operational capacity and market feasibility of the proposed off- track wagering facility will benefit the horse racing industry in this State. The applicant shall provide to the Commission:

(1) A five -year financial pro forma detailing the projected revenues and expenses of the proposed off-track wagering facility in sufficient detail to support an acceptable market rate of return on the project; and

(2) Detailed information on key individuals necessary to operate the proposed off-track wagering facility, which shall demonstrate that the applicant has the requisite staff to operate the facility.

2. By December 31 of the year after the application is submitted, the horsemen's organization's application must be deemed complete by the Commission. Prior to the application being deemed complete, the applicant must submit all the necessary documentation set forth in (a)1 above and rectify any deficiencies in the application via delivery of all supplemental documentation and information requested, and in the timeframe stated, by the Commission;

3. By December 31 of the year following the year in which the application was deemed complete, the off-track wagering facility referred to in the benchmark requirements of (a)1 and 2 above shall be opened for business and begin accepting wagers;

4. Each horsemen's organization shall comply with the consecutive annual requirements of (a)1 through 3 above until that horsemen's organization has opened all of the off-track wagering facilities within its acquired share or the unopened off-track wagering facilities within its acquired share will be subject to forfeiture. For example, by December 31 of the year after the horsemen's organization opened an off-track wagering facility for business, the horsemen's organization must file an application for an initial license for at least one other off-track wagering facility within its acquired share; and

5. Should no horsemen's organization petition to acquire a permit holder's forfeited share within one year of the Commission's written notice that a permit holder's right to appeal the forfeiture of its share has been exhausted, the Commission shall begin the process of making an off-track wagering facility within the forfeited share available to a well-suited entity pursuant to N.J.A.C. 13:74-2.6.

(b) The failure to meet the benchmarks in this section shall constitute a basis for the denial of the initial off-track wagering license for which the horsemen's organization applied. The failure to meet the benchmarks in this section shall result in the Commission ordering that the horsemen's organization shall forfeit its share of unopened off-track wagering facilities to be established. A horsemen's organization's share of unopened off-track wagering facilities to be established cannot be transferred until that horsemen's organization has exhausted its right to appeal the forfeiture.

N.J. Admin. Code § 13:74-2.5

Adopted by 51 N.J.R. 1772(a), effective 12/2/2019