STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DIVISION OF PARI-MUTUEL WAGERING, )

)

Petitioner, )

)

vs. ) CASE NO. 76-1455

) GULFSTREAM PARK RACING ASSOC., ) INC., )

)

Respondent. )

)

RECOMMENDED ORDER

This proceeding came up for final hearing before the undersigned Hearing Officer on December 2, 1976 in Coral Gables, Florida.

APPEARANCES

For Petitioner: Charles F. Tunnicliff, Esquire For Respondent: Leonard Romanik, Esquire

ISSUE

The Petitioner, Division of Pari-Mutuel Wagering, issued charges against the Respondent, Gulfstream Park Racing Association, Inc., alleging that Gulfstream violated Section 550.487, F.S., in its computation of purses awarded during its 1976 racing season. Respondent, Gulfstream Park Racing Association, Inc., is a corporation that operates Gulfstream Park Race Track, a thoroughbred horse racing establishment. The issues concerned in this proceeding were whether Gulfstream in fact incorrectly computed the amount of money it should have awarded in purses and if so whether it should suffer any penalty.

Section 550.487, F.S., states:

"Four-seventeenths of the commission authorized by s. 550.16 to be withheld by each of the winter thoroughbred licensees from its pari-mutuel pool, the same being equivalent to 4 percent of the pari-mutuel handle, shall be paid by each track for purses during its respective racing period. Computation of such 4 percent shall be based upon the previous year's average daily handle times the number of days authorized for the period operated by each respective permittee during its current racing year."

According to the Petitioner, this statute requires each race track to compute its average daily handle for the previous year and multiply 4 percent of that

figure by the number of racing days granted in a current season. The resultant figure would give the purse requirement. This system however was not used by the Respondent. Instead various estimates were used in an attempt to compute what was projected to be the average daily handle of Gulfstream for 1976. Since the race track had been granted different racing days, Gulfstream felt it would be unfair to use the 1975 average daily handle in computing the purse requirements for 1976. Using its own system, Gulfstream arrived at a figures of

$2,536,000 to be awarded as purses in the 1976 season. The Petitioner, Division of Pari-Mutuel Wagering, on the other hand, calculated that $2,701,562.88 should have been awarded as purses during that 1976 season. That figure was arrived at by multiplying $1,184,896 (Gulfstream's 1975 average daily handle) by 57 days (Gulfstream's racing season for 1976). The resulting figure is then multiplied by 4 percent as required in Section 550.487, F.S.

Gulfstream arrived at its lower figure by coming to the conclusion that the statutory requirement was unfair. After examining what the statute required and what the projected impact upon Gulfstream was, the management of Gulfstream decided they would recompute their purses based on their interpretation of what was fair under the circumstances.

The difference between the amount computed by the Division of Pari-Mutuel Wagering and Gulfstream amounts to $165,562.88.

After reviewing the statutory requirements it is clear that Gulfstream's computation of purses is in violation of the above quoted Florida Statute. That statute clearly and unequivocally computes purses for the current racing season by taking a percentage of the average daily handle of the previous year.

Gulfstream thought this was unfair and purposefully devised its own computation which it believed to be more equitable. Whether or not it was more equitable depends on one's point of view. It is without a doubt, however, that Gulfstream's method did not follow the statutory requirements. It is equally clear that Gulfstream thereby avoided paying over $165,000 in purses to the thoroughbred owners. Since it is determined that Gulfstream did violate the above statutes, the question then becomes the imposition of the appropriate penalty. Section 550.07, F.S., states in part:

". . . the division after notice and hearing may impose a civil penalty against any licensee for violations of this chapter or chapter 551, or any rule or regulation promulgated by the division. No penalty so imposed shall exceed $1,000 for each count or separate offense "

Gulfstream argues that the charges issued by the division contain only one count and therefore they are liable for a $1,000 civil penalty. On the other hand the division maintains that the act was violated each time a race was run by Gulfstream. After reviewing the charges filed it is clear that sufficient notice was given to Gulfstream that the Division of Pari-Mutuel Wagering contended that each purse awarded by it was in violation of the statute. The total amount actually awarded as racing purses by Gulfstream is the sum of every purse of every race for the year in question. The total is the sum of the parts. Where the entire amount is deficient by incremental steps each must be considered a separate cause of the violation. From the proof offered at the hearing of this proceeding it can be concluded that each time a purse was awarded by Gulfstream constituted a separate offense under the statute.

Therefore, after reviewing all the evidence in the case and considering the

amount by which Gulfstream has profited from its unilateral interpretation of the statute, it is recommended that a civil penalty be assessed against Gulfstream in the amount of $250,000.00.

DONE and ENTERED this 25th day of February, 1977, in Tallahassee, Florida.

KENNETH G. OERTEL, Director

Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304

(904) 488-9675

COPIES FURNISHED:

Charles F. Tunnicliff, Esquire Staff Attorney

Department of Business Regulation Division of Pari-Mutuel Wagering 725 South Bronough

Tallahassee, Florida 32304

Leonard Romanik, Esquire P. 0. Box 1040

Hollywood, Florida 33022

Docket for Case No: 76-001455

Orders for Case No: 76-001455