TEXAS RACING COMMISSION PO. BOX 12080 AUSTIN TEXAS 78711-2080 (G12) 833.6599 FAK (12) 839-0007 August 7, 2015 Phillip Oldham ‘Thompson and Knight 98 San Jacinto Blvd Suite 1900 ‘Austin, TX 78701 Re: Simulcasting Signals Dear Mr. Oldham: You asked for an explanation of my decision to approve current simuleasting requests only through ‘August 31, 2015. hope you find ths information responsive. Rider 7 to the Texas Racing Commission's (TRC’s) appropriations under HB 1, the General “Appropriations Act, provides: Approval of Central Administration & Other Support Services. None of the appropriations above in Strategy D.1.1, Central Admin & Other Support Services ‘may be expended until the Texas Racing Commission receives written approval from the Legislative Budget Board. {ave writen tothe Legislative Budget Board (LBB) to ask for clarification ofthe erteria it wl ase in determining whether to approve the Strategy D.ll appropriations, but [ have not yet feceived an answer, nor have Ireceived any isirastions a othe forma the Commission shold 1s in equesing approval Strategy D.1.1 appropriations are essential to the continued operations of the Commission. They {include authorization to expend funds for executive management and administrative support services, Central administrative staff handle budget and finance (including payroll and accounting), purchasing, human resources, public information requests and fulfillment of state reporting requirements. ‘Stategy D.1.1 also includes authorization to pay the rent and electricity ‘for the state headquarters.Phillip Olchara ‘August 7, 2015 Page? Without approval of these appropriations, staff cannot expend any funds for these purposes, even if sufficient funds are available in other strategies. Directing such a payment will be rejected by the Compiroller’s Office, and attempting to circumvent the restriction by falsely stating the purpose of the payment would 2 a criminal violation under Government Code § 403.071. Therefore, absent the necessary approvals from the LBB, the agency will no longer be able to pay ‘employees or its rent and will close at the end of the day on August 31, 2015. Ifthe agency closes, all racing will also stop, including both live and simulcast acing. Live racing ‘must stop since the Act requires that thre stewards or judges, as well as atleast one veterinarian, _must be present to supervise each meeting, and the Commission will no longer be able to pay the ‘wages of those employees. Regarding simuleasting, itis notin the public interest for me to approve simulcasting beyond August 31, 2015, while knowing that such simuleasting might not be regulated and overseen by Commission staff. Further, if the Commission has not received approval ofthe Strategy D.1.1 appropriations by August 31, 2015, will rescind any simuleasting approvals already given for September I and beyond. On the other hand, ifthe LBB gives the necessary approval on ot before August 31, 2015, Twill promptly approve future simuleastng as appropriate. hope this information enswers your questions. If you have any other questions, please let me or General Counsel Mark Fenner know.