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The Pari-mutuel Law in New York

In 1940, the legislature enacted the Pari-mutuel Revenue Law, which continued to state racing commission.

The commission was empowered to license pari-mutuel betting on horse races and steeplechases conducted by incorporated racing associations, to set the rules governing such betting, and to investigate all cases related to race betting by subpoenaing books and records.

To ensure the honesty of the betting system, the associations were required to be bonded, and precise standards for bookkeeping, bet paying, and information posting were imposed.

Betting was limited to on-track transactions, which proved to be financial boon to track owners.

During the Wagner administration in New York City, a series of fiscal crises inspired the city to lobby for legalized off-track betting (OTB) as a means of solving its financial problems.

Advocates claimed that it would raise at least $2 billion annually. While the city pushed for OTB, the state legislature, reflecting race track interests, opposed it.

Public opinion in New York City ran three to one in favor of OTB, and one 1963 public opinion poll revealed that few New Yorkers worried about the morality of race betting.

The city quickly exercised the local option provided in the law and established the New York City Off-Track Betting Corporation, a public benefit corporation 'operated along the lines of a private enterprise business whose profits accrue to the taxpayers in the form of public revenue'.

The extent to which OTB has accomplished its dual goals of raising revenue and combating organized crime cannot yet be fully evaluated, but a preliminary verdict is that OTB has succeeded in increasing government revenues as well as redistributing them.

The irony of the OTB phenomenon is that many horsemen and track owners say that is slowly destroying racing. They claim that it has caused on-track attendance to sag and that it is responsible for the growing number of racing injuries.

Trying to keep up with the minimum figure of $5,600 for the yearly upkeep of each of their horses, owners no longer give their good stock a rest. Tired horses and tired jockeys make mistakes.

One conclusion about New York gambling would be that despite ventures into legalization and state control. Unfortunately, New York has not succeeded in putting organized crime or illegal gambling out of business.

One study recommended that New York also legalize casino gambling, slot machines, and pari-mutuel betting on jai-alai, claiming $1.15 billion per year could be raised as a result of legalization.

Also, a study conducted by the Find for the City of New York, however, found that the goals of trying to raise substantial revenue and compete with organized crime were contradictory.