TITLE 16. ECONOMIC REGULATION

DIVISION 3. DUTIES OF OTHER OFFICIALS

16 TAC §313.61

PREAMBLE:

The Texas Racing Commission (TXRC) adopts Texas Administrative Code, Title 16, Part 8, Chapter 313, §313.61, Horsemen's Bookkeeper. Amended Chapter 313, §313.61 is adopted with changes to the proposed text as published in the January 31, 2025, issue of the Texas Register (50 TexReg 614). The rule text will be republished.

EXPLANATION AND JUSTIFICATION FOR THE AMENDMENT

The purpose of this rule amendment is to strengthen the ability of the Commission to track and audit funds that are managed by the Horsemen's Bookkeeper.

PUBLIC COMMENTS

The 30-day comment period ended on March 2, 2025. TXRC drafted and distributed the proposed rule to persons both internal and external to the agency. The proposed rule was published in the January 31, 2025, issue of the Texas Register (50 TexReg 614). During this period, the Agency received no comments regarding this proposed rule change.

COMMISSION ACTION

At its meeting on June 11, 2025, the Commission adopted the proposed rule as recommended by the Commission at the December 11, 2024, meeting and the Rules Committee meeting, held on November 14, 2024.

ONE-FOR-ONE REQUIREMENT FOR RULES WITH A FISCAL IMPACT

The Commission is exempt and not required to take further action under Texas Government Code §2001.0045. The Commission is specifically exempt under Texas Government Code §2001.0045(c)(7).

STATUTORY AUTHORITY

The amendments are adopted under Texas Occupations Code §2021.

The statutory provisions affected by the adopted rule amendment are those set forth in Texas Occupations Code §2021.

§ 313.61. Horsemen's Bookkeeper.

(a) Designation of horsemen's bookkeeper.

(1) An association shall ensure a horsemen's bookkeeper is available to maintain the horsemen's account.

(2) The executive director may designate an entity unrelated to the association to serve as the horsemen's bookkeeper. To be designated as the horsemen's bookkeeper, an entity must annually submit a plan of operation acceptable to the executive director that demonstrates the entity's ability to perform the duties of the horsemen's bookkeeper.

(3) A designation as horsemen's bookkeeper does not constitute a license, but the executive director may require any individual involved with a designated entity to receive a license.

(4) If the executive director approves an association's request to designate an entity as horsemen's bookkeeper, the association is relieved of responsibility for providing a horsemen's bookkeeper and shall cooperate fully with the horsemen's bookkeeper designated by the executive director.

(b) Revocation of designation.

(1) A designation as the horsemen's bookkeeper continues in effect until revoked by the executive director.

(2) The executive director may revoke a designation as the horsemen's bookkeeper if the executive director determines the designated entity has:

(A) failed to comply with the Act, or the plan of operation, in a manner that indicates malfeasance as opposed to mere mistake;

(B) failed to maintain accurate and reliable records;

(C) misappropriated or mishandled funds in its possession or control;

(D) failed to correct within a reasonable time any deficiency in operations identified by the executive director in writing; or

(E) had its authority to act as a horsemen's bookkeeper revoked in another jurisdiction.

(3) Before revoking a designation as horsemen's bookkeeper, the executive director must issue a notice of proposed revocation which specifically describes the grounds for revocation. No later than 30 days after receiving a notice of proposed revocation, the entity may file a written response to the allegations with the executive director.

(4) The executive director may not revoke a designation without making adequate provision for a successor horsemen's bookkeeper.

(c) Operations of horsemen's bookkeeper.

(1) Each owner engaged in racing must open and maintain an account with the horsemen's bookkeeper. The horsemen's bookkeeper may permit other individuals to open and maintain an account with the horsemen's bookkeeper, subject to the approval of the executive director. The aggregate of all such accounts is the horsemen's account.

(2) The horsemen's bookkeeper shall keep accurate records of the horsemen's account and the constituent accounts. The horsemen's bookkeeper shall:

(A) promptly credit each account with all earnings, awards, and deposits;

(B) deduct or disburse all payments as directed by the owner or authorized agent;

(C) render periodic statements of each constituent account; and

(D) perform all other duties and functions as may be required by the Act or the Rules.

(d) Audit. The executive director may at any time inspect, review or audit the records and performance of the horsemen's bookkeeper. Not later than June 15 of each year beginning in 2026, the horsemen's bookkeeper shall submit to the Commission audited financial statements. The funds received and/or expended by the horsemen's bookkeeper from the horse industry escrow account must be included in the audit. An auditor's statement must be included as part of the annual audit attesting to the proper use of the funds received from the horse industry escrow account by the horsemen's bookkeeper.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on July 3, 2025.

TRD-202502240

Amy F. Cook

Executive Director

Texas Racing Commission

Effective date: July 23, 2025

Proposal publication date: January 31, 2025

For further information, please call: (512) 833-6699

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