BEFORE THE BOARD OF HORSE RACING
DEPARTMENT OF LIVESTOCK
STATE OF MONTANA
In the matter of the adoption of ) NOTICE OF ADOPTION
NEW RULES I – VIII pertaining to advance )
deposit account wagering on horse racing )
and greyhound racing )
TO: All Concerned Persons
1. On January 17, 2008, the Board of Horse Racing, Department of Livestock, published MAR Notice No. 32-8-190 pertaining to the adoption of the above-stated rules at page 18 of the 2008 Montana Administrative Register, Issue Number 1.
2. The board has adopted New Rule I (32.28.2001), New Rule II (32.28.2002), New Rule III (32.28.2005), New Rule IV (32.28.2007), New Rule V (32.28.2008), New Rule VI (32.28.2009), New Rule VII (32.28.2011), and New Rule VIII (32.28.2012) exactly as proposed.
3. The board has thoroughly considered the comment received. A summary of the comment received and the board's response is as follows:
COMMENT NO. 1: One comment was received from Surety Fidelity Association of America (SFAA) stating New Rule II(6)'s language requiring a licensed hub operator to provide a bond or alternative means of payment - such as bonds or letters of credit from other jurisdictions - will not provide the protection the board is seeking. The comment stated a surety bond from another jurisdiction is an indication of the hub operator's ability to meet the obligations of the other jurisdiction, not the obligations of the board. SFAA proposed that all licensed hub operators be required to post a bond or other security whether or not the operator posts a bond in another jurisdiction. SFAA suggests this bond should be in a reasonable amount and with reasonable terms and conditions as suggested by the comment.
RESPONSE: The board noted the current language in New Rule II is sufficient. The board may rely on bonding in another state, as well as any irrevocable letters of credit, or other forms of financial guarantees posted in other jurisdictions. The board is cognizant of the possibility that a hub operator may not want to negotiate a bond in this state, and might even decline to do business in this jurisdiction if unduly onerous bond requirement were imposed. The current rule language requirement is adequate and will accomplish the board's goal of ensuring financial responsibility for payments due to the board.
BOARD OF HORSE RACING
DEPARTMENT OF LIVESTOCK
/s/ Christian Mackay /s/ Carol Grell Morris
Christian Mackay Carol Grell Morris
Executive Officer Rule Reviewer
Department of Livestock
Certified to the Secretary of State March 3, 2008.