§ 1.150 - Submission of the Authority's proposed budget submissions.

§ 1.150 Submission of the Authority's proposed budget submissions.

(a) Mandatory annual submission. The Authority must submit a proposed annual budget to the Commission every year, irrespective of whether there is a “proposed increase in the amount required” under 15 U.S.C. 3052(f)(1)(C)(iv). The submission of the proposed budget for the following year must be made by September August 1 of the current year, following the procedures set forth in § 1.143. The Authority's annual budget will use the calendar year as its fiscal year.

(b) Public Consideration of public comments. In addition to Before submitting its planned proposed budget to the Commission by September 1 of the preceding yearin August, the Authority shall must post such planned the proposed budget on its own website as early as is practicable, with an invitation to the public to submit comments to the Authority on any aspect of the planned next year's proposed budget. The Authority shall must post such any pertinent comments it receives on its website upon their arrival and shall , and it must review them to ascertain whether to revise the proposed budget in any manner. In addition, the Authority shall promptly forward to the Commission:

(1) Any such public comments that it receives; and

(2) An assessment of such public comments that it believes would assist the Commission's evaluation of the Authority's planned budget.

(c) Contents of submission —

light of them.

(c) Contents of submission. The Authority's proposed budget submission to the Commission must include the following:

(1) Indication of Board vote. The Authority's proposed budget must be approved by a majority of its Board of Directors (, or, in the case of its initial budget or a budget that exceeds the preceding year's budget by 5 percent or more, a two-thirds supermajority) and . The Authority's submission to the Commission must state the Board vote on the motion to approve the budget.

(2) Revenue information. The proposed budget must identify both the estimated amount required from each State racing commission as calculated under 15 U.S.C. 3052(f) and all other sources of Authority revenue as well as any loans proposed to be obtained by the Authority.

(3) Expenditure information. The proposed budget must identify expenditures separately for:

(i) The racetrack safety program;

(ii) The anti-doping and medication control program;

(iii) All other programmatic expenditures other than for racetrack safety and anti-doping and medication control, such as the administration of the Authority or its technological needs;

(iv) Repayment of any loans; and

(v) Any funding shortfall incurred.

(4) Line items. For both revenue and expenditure information, the Authority's proposed budget must provide sufficient information, by line item, as would be required for members of the Authority's Board of Directors to exercise their fiduciary duty of care. For example, the proposed budget's expenditure information for anti-doping and medication control might include separate line items for in-house salaries, the costs of testing of laboratory samples, the costs of arbitrators, and all the costs associated with contracting with an anti-doping and medication control enforcement agency. The proposed budget must include a narrative component that provides a brief explanation of each line item's utility in carrying out the purposes of the Horseracing Integrity and Safety Act.

(5) Comparison of approved budget to actual revenues and expenditures. The For each approved line item, the proposed budget must provide a comparison showing , for each approved line item, the actual revenues and expenditures for the current year along with a narrative component explaining why any line item is anticipated to deviate by 10 percent or more during the current year.

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Approval and publication of submission. The Commission will publish the Authority's proposed budget in the Federal Register if the Commission determines that the proposed budget contains sufficient information for the members of the Board of Directors of the Authority to exercise their fiduciary duty of care and meets the requirements of this subpart.

Public comments received and the Authority's response. The Authority must include with its submission all of the public comments that it received after posting the proposed budget on its website. The Authority must also provide an assessment of public comments relevant to the Commission's evaluation of the proposed budget. The Authority must also identify any changes made to the proposed budget in response to the comments received.

(d) Publication of the proposed budget in the Federal Register. If the Secretary concludes that the Authority's submission complies with § 1.150(c), then the Secretary will publish the Authority's proposed budget in the Federal Register with supporting materials available on regulations.gov. Members of the public will then have 14 days after the date of publication in which to file comments on the proposed budget. Public comments should provide commenters' views as to the decisional criteria set forth in § 1.151(c) and whether any line items should be modified.