Section 1612. Disposition of revenues

* a. The division shall pay into an
  account, to be known as the  lottery  prize  account,  under  the  joint
  custody  of  the comptroller and the commissioner, within one week after
  collection of sales receipts from a lottery game, such moneys  necessary
  for  the  payment  of  lottery  prizes  but  not to exceed the following
  percentages, plus interest earned thereon:
    (1) sixty percent of the total amount for which tickets have been sold
  for a lawful lottery game introduced on or after the effective  date  of
  this paragraph, subject to the following provisions:
    (A)  drawings  in such game shall be held during no more than thirteen
  hours each day, no more than eight hours of which shall be consecutive;
    (B) such game shall be available only on premises occupied by licensed
  lottery sales agents, subject to the following provisions:
    (i) if the licensee holds a license issued pursuant to  the  alcoholic
  beverage  control law to sell alcoholic beverages for consumption on the
  premises, then not less than twenty-five percent of the gross sales must
  result from sales of food;
    (ii) if the licensee does not hold a license issued  pursuant  to  the
  alcoholic   beverage   control  law  to  sell  alcoholic  beverages  for
  consumption on the premises, then  the  premises  must  have  a  minimum
  square footage greater than two thousand five hundred square feet;
    (iii)  notwithstanding  the foregoing provisions, television equipment
  that  automatically  displays  the  results  of  such  drawings  may  be
  installed and used without regard to the percentage of food sales or the
  square footage if such premises are used as:
    (I) a commercial bowling establishment, or
    (II)  a facility authorized under the racing, pari-mutuel wagering and
  breeding law to accept pari-mutuel wagers;
    (C) the rules for the operation of such game shall be as prescribed by
  regulations promulgated and adopted by the division,  provided  however,
  that such rules shall provide that no person under the age of twenty-one
  may  participate in such games on the premises of a licensee who holds a
  license issued pursuant to the alcoholic beverage control  law  to  sell
  alcoholic  beverages  for  consumption  on  the premises; and, provided,
  further, that such regulations may be revised on an emergency basis  not
  later than ninety days after the enactment of this paragraph in order to
  conform such regulations to the requirements of this paragraph; or
    (2) sixty-five percent of the total amount for which tickets have been
  sold  for  the  "Instant Cash" game in which the participant purchases a
  preprinted ticket on which dollar amounts or symbols  are  concealed  on
  the  face  or the back of such ticket, provided however up to three such
  games may be offered during the fiscal year, seventy-five percent of the
  total amount for which tickets have been sold for such  three  games  in
  which  the  participant  purchases  a  preprinted ticket on which dollar
  amounts or symbols are concealed on the face or the back of such ticket;
  or
    (3) fifty percent of the total amount for which tickets have been sold
  for games known as: (A) the "Daily Numbers Game" or  "Win  4",  discrete
  games  in  which  the  participants select no more than three or four of
  their own numbers to match with three  or  four  numbers  drawn  by  the
  division  for  purposes  of determining winners of such games, (B) "Pick
  10", offered no more than once daily, in which participants select  from
  a  specified field of numbers a subset of ten numbers to match against a
  subset of numbers to be drawn by the division from such field of numbers
  for the purpose of determining winners  of  such  game,  (C)  "Take  5",
  offered  no  more  than  once daily, in which participants select from a
  specified field of numbers a subset of five numbers to match  against  a
  subset  of  five  numbers to be drawn by the division from such field of

  numbers for purposes of determining winners of such game,  and  (D)  any
  joint, multi-jurisdiction, and out-of-state lottery; or
    (4) forty percent of the total amount for which tickets have been sold
  for:  (A)  "Lotto",  offered no more than once daily, a discrete game in
  which all participants select a specific subset of numbers  to  match  a
  specific  subset  of  numbers,  as  prescribed  by rules and regulations
  promulgated and adopted by the division, from a larger specific field of
  numbers, as also prescribed by such rules and regulations and  (B)  with
  the   exception   of  the  game  described  in  paragraph  one  of  this
  subdivision, such other state-operated lottery games which the  division
  may  introduce,  offered no more than once daily, commencing on or after
  forty-five days following the official  publication  of  the  rules  and
  regulations for such game.
    The  moneys  in  the  lottery  prize account shall be paid out of such
  account on  the  audit  and  warrant  of  the  comptroller  on  vouchers
  certified  or  approved  by  the  director or his or her duly designated
  official.
    Prize money derived from ticket sales receipts of  a  particular  game
  and  deposited  in  the  lottery  prize  account  in accordance with the
  percentages set forth above may be used to  pay  prizes  in  such  game.
  Balances in the lottery prize account identified by individual games may
  be carried over from one fiscal year to the next to ensure proper payout
  of games.
    * NB Effective until May 31, 2010
    * a.  The  division  shall  pay  into  an  account, to be known as the
  lottery prize account, under the joint custody of  the  comptroller  and
  the commissioner, within one week after a lottery prize drawing has been
  held, such moneys necessary for the payment of lottery prizes but not to
  exceed the following percentages, plus interest earned thereon:
    (1) sixty-five percent of the total amount for which tickets have been
  sold  for  the  "Instant Cash" game in which the participant purchases a
  preprinted ticket on which dollar amounts or symbols  are  concealed  on
  the  face  or the back of such ticket, provided however up to three such
  games may be offered during the fiscal year, seventy-five percent of the
  total amount for which tickets have been sold for such  three  games  in
  which  the  participant  purchases  a  preprinted ticket on which dollar
  amounts or symbols are concealed on the face or the back of such ticket;
  or
    (2) fifty percent of the total amount for which tickets have been sold
  for games known as: (A) the "Daily Numbers Game" or  "Win  4",  discrete
  games  in  which  the  participants select no more than three or four of
  their own numbers to match with three  or  four  numbers  drawn  by  the
  division for purposes of determining winners of such games and (B) "Pick
  10",  offered no more than once daily, in which participants select from
  a specified field of numbers a subset of ten numbers to match against  a
  subset of numbers to be drawn by the division from such field of numbers
  for  the  purpose  of  determining  winners  of such game, (C) "Take 5",
  offered no more than once daily, in which  participants  select  from  a
  specified  field  of numbers a subset of five numbers to match against a
  subset of five numbers to be drawn by the division from  such  field  of
  numbers  for  purposes  of determining winners of such game, and (D) any
  joint, multi-jurisdiction, and out-of-state lottery; or
    (3) forty percent of the total amount for which tickets have been sold
  for: (A) "Lotto", offered no more than once daily, a  discrete  game  in
  which  all  participants  select a specific subset of numbers to match a
  specific subset of numbers,  as  prescribed  by  rules  and  regulations
  promulgated and adopted by the division, from a larger specific field of
  numbers,  as  also prescribed by such rules and regulations and (B) such

  other state-operated lottery games which  the  division  may  introduce,
  offered  no more than once daily, commencing on or after forty-five days
  following the official publication of the rules and regulations for such
  game.
    The  moneys  in  the  lottery  prize account shall be paid out of such
  account on  the  audit  and  warrant  of  the  comptroller  on  vouchers
  certified  or  approved  by  the  director or his or her duly designated
  official.
    Prize money derived from ticket sales receipts of  a  particular  game
  and  deposited  in  the  lottery  prize  account  in accordance with the
  percentages set forth above may be used to  pay  prizes  in  such  game.
  Balances in the lottery prize account identified by individual games may
  be carried over from one fiscal year to the next to ensure proper payout
  of games.
    * NB Effective May 31, 2010
    b.  1.  Notwithstanding  section  one  hundred twenty-one of the state
  finance law, on or before the twentieth day of each month, the  division
  shall  pay  into  the state treasury, to the credit of the state lottery
  fund created by section ninety-two-c of the state finance law, not  less
  than  forty-five percent of the total amount for which tickets have been
  sold for games defined in  paragraph  four  of  subdivision  a  of  this
  section during the preceding month, not less than thirty-five percent of
  the  total  amount for which tickets have been sold for games defined in
  paragraph three of subdivision a of this section  during  the  preceding
  month,  not  less  than  twenty  percent  of  the total amount for which
  tickets have been sold for games defined in paragraph two of subdivision
  a of this section during the preceding month, provided however that  for
  games  with  a  prize payout of seventy-five percent of the total amount
  for which tickets have been sold, the division shall pay not  less  than
  ten  percent  of  sales  into  the  state  treasury  and  not  less than
  twenty-five percent of the total amount for which tickets have been sold
  for games defined in paragraph one of  subdivision  a  of  this  section
  during  the  preceding month; and the balance of the total revenue after
  payout for prizes for games known as "video lottery  gaming,"  (i)  less
  ten  percent  of the total revenue wagered after payout for prizes to be
  retained by the division for operation, administration, and  procurement
  purposes; (ii) less a vendor's fee the amount of which is to be paid for
  serving as a lottery agent to the track operator of a vendor track:
    (A)  having fewer than one thousand one hundred video gaming machines,
  at a rate of thirty-six percent for  the  first  fifty  million  dollars
  annually,  twenty-nine  percent  for  the  next  hundred million dollars
  annually, and twenty-six percent thereafter of the total revenue wagered
  at the vendor track after payout for prizes pursuant to this chapter;
    (B) having one thousand one hundred or more video gaming machines,  at
  a  rate of thirty-two percent of the total revenue wagered at the vendor
  track after payout for prizes pursuant to this chapter, except for  such
  facility  located  in  the county of Westchester, in which case the rate
  shall be thirty-four percent of the total revenue wagered at the  vendor
  track  after payout for prizes pursuant to this chapter, for a period of
  twenty-four months effective beginning April first, two thousand  eight;
  provided,  however,  that  in the event that the vendor track located in
  Westchester county completes a successful restructuring prior  to  March
  thirty-first,  two  thousand  ten,  the  vendor  fee  will be reduced to
  thirty-two  percent  ninety  days  following  the  completion   of   the
  successful  restructuring.  A  successful  restructuring is defined as a
  restructuring of the existing debt  obligations  of  such  vendor  track
  located in Westchester county that meets the following two conditions:

    (i)  it  requires  no  more  than twenty million dollars of additional
  equity invested in such track; and
    (ii) results in average net interest costs of less than nine percent.
    Notwithstanding  the  foregoing,  the  vendor  fee  at such track will
  become thirty-one percent effective April first, two  thousand  ten  and
  remain  at that level for a period equal to two times the period of time
  (measured in days) that the vendor fee was thirty-four percent or  until
  March   thirty-first,   two   thousand   twelve,   whichever  is  later.
  Notwithstanding the foregoing, not later than April first, two  thousand
  twelve,  the  vendor  fee  shall become thirty-two percent and remain at
  that level thereafter; and except for Aqueduct racetrack, in which  case
  the  vendor  fee  shall  be  thirty-eight  percent  of the total revenue
  wagered at the vendor track after payout for  prizes  pursuant  to  this
  chapter;
    (C) notwithstanding clauses (A) and (B) of this subparagraph, when the
  vendor  track  is  located in an area with a population of less than one
  million within the forty mile radius around such track,  at  a  rate  of
  forty  percent for the first fifty million dollars annually, twenty-nine
  percent for the next hundred million dollars  annually,  and  twenty-six
  percent  thereafter  of  the  total  revenue wagered at the vendor track
  after payout for prizes pursuant to this chapter;
    (D) notwithstanding clauses (A), (B) and  (C)  of  this  subparagraph,
  when  the  vendor  track  is  located  within  fifteen miles of a Native
  American class III gaming facility at a rate of forty-two percent of the
  total revenue wagered at  the  vendor  track  after  payout  for  prizes
  pursuant to this chapter;
    (E)   notwithstanding   clauses   (A),   (B),  (C)  and  (D)  of  this
  subparagraph, when a  Native  American  class  III  gaming  facility  is
  established,  after  the  effective  date  of  this subparagraph, within
  fifteen miles of the vendor track, at a rate of forty-two percent of the
  total revenue wagered after payout for prizes pursuant to this chapter;
    (E-1) for purposes of this subdivision, the term  "class  III  gaming"
  shall have the meaning defined in 25 U.S.C. § 2703(8).
    (F)  notwithstanding  clauses  (A),  (B),  (C),  (D)  and  (E) of this
  subparagraph, when a vendor track, is located  in  Sullivan  county  and
  within  sixty  miles from any gaming facility in a contiguous state such
  vendor fee shall, for a period of five years commencing April first, two
  thousand eight, be at a rate of forty-two percent of the  total  revenue
  wagered  at  the  vendor  track after payout for prizes pursuant to this
  chapter, after which time such rate shall be as for all tracks in clause
  (C) of this subparagraph.
    (G) notwithstanding any other provisions of this section, when no more
  than one vendor track located in the town of Thompson in Sullivan county
  at the site of the former Concord Resort at which  a  qualified  capital
  investment  has  been  made  and  no  fewer than one thousand full-time,
  permanent employees have been newly hired, is located in Sullivan county
  and is within sixty miles from  any  gaming  facility  in  a  contiguous
  state,  then for a period of forty years the division shall pay into the
  state treasury, to the credit of  the  state  lottery  fund  created  by
  section  ninety-two-c  of  the  state  finance  law  the  greater of (i)
  twenty-five percent of total revenue after payout for prizes for  "video
  lottery   games"  or  (ii)  for  the  first  eight  years  of  operation
  thirty-eight million  dollars,  and  beginning  in  the  ninth  year  of
  operation  such  amount  shall  increase  annually  by the lesser of the
  increase in the consumer price index or two percent  plus  the  division
  shall  retain  an  amount  equal  to  all  actual  expenses  related  to
  operations, administration and procurement of the video lottery terminal
  operation at no more than one  vendor  track  located  in  the  town  of

  Thompson  in  Sullivan  county at the site of the former Concord Resort,
  provided, however, such amount retained by the division shall not exceed
  seven percent of total revenue after payout of prizes. In  addition,  in
  the event the division makes a payment pursuant to subclause (i) of this
  clause,  the  division shall pay to the credit of the state lottery fund
  created by section ninety-two-c of the state finance law  11.11  percent
  of the amount by which total revenue after payout for prizes exceeds two
  hundred  fifteen  million  dollars,  but  in no event shall such payment
  exceed five million dollars.
    The balance shall be paid as a vendor's fee to the track  operator  of
  no  more  than  one  vendor  track  located  in  the town of Thompson in
  Sullivan county at the site of the former Concord Resort for serving  as
  a lottery agent under this chapter.
    Provided,  however,  that in the case of no more than one vendor track
  located in the town of Thompson in Sullivan county at the  site  of  the
  former  Concord  Resort  with  a  qualified  capital investment, and one
  thousand full-time, permanent employees as of July first,  two  thousand
  eleven  if  at  any  time after three years of opening operations of the
  licensed video gaming facility or  licensed  vendor  track,  the  vendor
  track  experiences  an  employment  shortfall, then the recapture amount
  shall apply, for only such period as the shortfall exists.
    For the purposes of this section "qualified capital investment"  shall
  mean  an  investment  of  a  minimum  of  six hundred million dollars as
  reflected by audited financial statements of which not less  than  three
  hundred  million  dollars  shall be comprised of equity and/or mezzanine
  financing as an initial investment in a county where twelve  percent  of
  the  population  is  below  the federal poverty level as measured by the
  most recent Bureau of Census Statistics prior to the  qualified  capital
  investment  commencing  that results in the construction, development or
  improvement  of  at  least  one  eighteen  hole  golf  course,  and  the
  construction  and  issuance  of  certificates  of  occupancy for hotels,
  lodging, spas, dining, retail and entertainment venues, parking  garages
  and  other  capital  improvements  at  or adjacent to the licensed video
  gaming facility or licensed vendor  track  which  promote  or  encourage
  increased attendance at such facilities.
    For  the  purposes  of  this  section, "full-time, permanent employee"
  shall mean an employee who has worked  at  the  video  gaming  facility,
  vendor  track  or  related  and  adjacent  facilities  for  a minimum of
  thirty-five hours per week for not less than four consecutive weeks  and
  who  is  entitled  to  receive  the  usual and customary fringe benefits
  extended to other employees with comparable  rank  and  duties;  or  two
  part-time employees who have worked at the video gaming facility, vendor
  track  or  related  and  adjacent  facilities  for a combined minimum of
  thirty-five hours per week for not less than four consecutive weeks  and
  who  are  entitled  to  receive  the usual and customary fringe benefits
  extended to other employees with comparable rank and duties.
    For the purpose of this  section  "employment  goal"  shall  mean  one
  thousand five hundred full-time permanent employees after three years of
  opening  operations  of  the  licensed video gaming facility or licensed
  vendor track.
    For the purpose of this section "employment shortfall"  shall  mean  a
  level  of  employment that falls below the employment goal, as certified
  annually by vendor's certified  accountants  and  the  chairman  of  the
  empire state development corporation.
    For  the  purposes  of  this section "recapture amount" shall mean the
  difference between the amount of the vendor's fee paid to a vendor track
  with a qualified  capital  investment,  and  the  vendor  fee  otherwise
  payable  to  a vendor track pursuant to clause (F) of this subparagraph,

  that is reimbursable by the vendor track to  the  division  for  payment
  into the state treasury, to the credit of the state lottery fund created
  by  section  ninety-two-c of the state finance law, due to an employment
  shortfall  pursuant to the following schedule only for the period of the
  employment shortfall:
    (i) one hundred percent of the  recapture  amount  if  the  employment
  shortfall  is  greater  than  sixty-six  and  two-thirds  percent of the
  employment goal;
    (ii) seventy-five percent of the recapture amount  if  the  employment
  shortfall  is  greater  than  thirty-three  and one-third percent of the
  employment goal;
    (iii) forty-nine and one-half percent of the recapture amount  if  the
  employment  shortfall  is  greater than thirty percent of the employment
  goal;
    (iv) twenty-two percent of the  recapture  amount  if  the  employment
  shortfall is greater than twenty percent of the employment goal;
    (v) eleven percent of the recapture amount if the employment shortfall
  is greater than ten percent of the employment goal.
    (H)  notwithstanding  clauses  (A), (B), (C), (D), (E), (F) and (G) of
  this subparagraph, the  track  operator  of  a  vendor  track  shall  be
  eligible for a vendor's capital award of up to four percent of the total
  revenue  wagered at the vendor track after payout for prizes pursuant to
  this chapter, which  shall  be  used  exclusively  for  capital  project
  investments  to improve the facilities of the vendor track which promote
  or encourage increased attendance at the video lottery  gaming  facility
  including,   but  not  limited  to  hotels,  other  lodging  facilities,
  entertainment facilities, retail facilities, dining  facilities,  events
  arenas,  parking  garages  and  other improvements that enhance facility
  amenities; provided that such capital investments shall be  approved  by
  the  division, in consultation with the state racing and wagering board,
  and that such vendor track demonstrates that such  capital  expenditures
  will  increase  patronage at such vendor track's facilities and increase
  the amount of revenue generated to support state education programs. The
  annual amount of such vendor's capital awards that a vendor track  shall
  be  eligible  to  receive  shall  be limited to two million five hundred
  thousand dollars, except for Aqueduct racetrack, for which  there  shall
  be  no  vendor's  capital awards. Except for tracks having less than one
  thousand one hundred video gaming machines, each track operator shall be
  required to co-invest an amount of  capital  expenditure  equal  to  its
  cumulative  vendor's  capital award. For all tracks, except for Aqueduct
  racetrack, the amount of any vendor's capital award  that  is  not  used
  during  any  one  year  period may be carried over into subsequent years
  ending  before  April  first,  two   thousand   thirteen.   Any   amount
  attributable to a capital expenditure approved prior to April first, two
  thousand thirteen and completed before April first, two thousand fifteen
  shall  be  eligible  to receive the vendor's capital award. In the event
  that a vendor track's capital expenditures,  approved  by  the  division
  prior to April first, two thousand thirteen and completed prior to April
  first,  two  thousand  fifteen,  exceed  the  vendor  track's cumulative
  capital award during the  five  year  period  ending  April  first,  two
  thousand  thirteen,  the  vendor  shall  continue to receive the capital
  award after April first,  two  thousand  thirteen  until  such  approved
  capital  expenditures  are  paid  to  the  vendor  track  subject to any
  required co-investment. In no event shall any vendor track that receives
  a vendor fee pursuant to clause (F)  or  (G)  of  this  subparagraph  be
  eligible  for  a vendor's capital award under this section. Any operator
  of a vendor track which has received a vendor's capital award,  choosing
  to  divest  the  capital improvement toward which the award was applied,

  prior to the full depreciation of the capital improvement in  accordance
  with generally accepted accounting principles, shall reimburse the state
  in  amounts equal to the total of any such awards. Any capital award not
  approved for a capital expenditure at a video lottery gaming facility by
  April  first,  two  thousand  thirteen shall be deposited into the state
  lottery fund for education aid; and
    (iii) less an additional vendor's marketing allowance at a rate of ten
  percent for the first one hundred million  dollars  annually  and  eight
  percent  thereafter  of  the  total  revenue wagered at the vendor track
  after payout for prizes to be used by the vendor track for the marketing
  and  promotion  and  associated  costs  of  its  video  lottery   gaming
  operations  and pari-mutuel horse racing operations, as long as any such
  costs associated with pari-mutuel horse racing operations simultaneously
  encourage increased attendance at such  vendor's  video  lottery  gaming
  facilities, consistent with the customary manner of marketing comparable
  operations in the industry and subject to the overall supervision of the
  division;  provided,  however,  that  the  additional vendor's marketing
  allowance shall not exceed eight percent in any year for any operator of
  a racetrack located in the county of Westchester  or  Queens;  provided,
  however,  a  vendor  track that receives a vendor fee pursuant to clause
  (G) of subparagraph  (ii)  of  this  paragraph  shall  not  receive  the
  additional vendor's marketing allowance. In establishing the vendor fee,
  the  division  shall  ensure  the  maximum lottery support for education
  while also ensuring the  effective  implementation  of  section  sixteen
  hundred  seventeen-a of this article through the provision of reasonable
  reimbursements and compensation to vendor tracks  for  participation  in
  such  program. Within twenty days after any award of lottery prizes, the
  division shall pay into the state treasury, to the credit of  the  state
  lottery  fund,  the  balance of all moneys received from the sale of all
  tickets for the lottery in which  such  prizes  were  awarded  remaining
  after  provision  for  the  payment  of  prizes  as herein provided. Any
  revenues derived from the sale of advertising on lottery  tickets  shall
  be deposited in the state lottery fund.
    2.  As  consideration  for  the  operation  of  a video lottery gaming
  facility, the  division,  shall  cause  the  investment  in  the  racing
  industry  of  a portion of the vendor fee received pursuant to paragraph
  one of this subdivision in the manner set  forth  in  this  subdivision.
  With the exception of Aqueduct racetrack, each such track shall dedicate
  a portion of its vendor fees, received pursuant to clause (A), (B), (C),
  (D),  (E),  (F),  or  (G)  of subparagraph (ii) of paragraph one of this
  subdivision, solely for the purpose of enhancing purses at  such  track,
  in  an  amount  equal  to  eight and three-quarters percent of the total
  revenue wagered at the  vendor  track  after  pay  out  for  prizes.  In
  addition,  with the exception of Aqueduct racetrack, one and one-quarter
  percent of total revenue wagered at the vendor track after pay  out  for
  prizes, received pursuant to clause (A), (B), (C), (D), (E), (F), or (G)
  of  subparagraph  (ii)  of  paragraph  one of this subdivision, shall be
  distributed to the appropriate breeding fund for the  manner  of  racing
  conducted by such track.
    Provided,  further,  that nothing in this paragraph shall prevent each
  track from entering into an agreement, not to exceed  five  years,  with
  the  organization  authorized  to  represent its horsemen to increase or
  decrease the portion of its vendor fee dedicated to enhancing purses  at
  such  track  during the years of participation by such track, or to race
  fewer dates than required herein.
    3. Nothing in paragraph two  of  this  subdivision  shall  affect  any
  agreement in effect on or before the effective date of this paragraph.

    c. 1. The specifications for video lottery gaming shall be designed in
  such  a manner as to pay prizes that average no less than ninety percent
  of sales.
    2.  Of  the  ten  percent  retained by the division for administrative
  purposes, any amounts beyond that which are necessary for the  operation
  and  administration  of  this  pilot  program  shall be deposited in the
  lottery education account.
    d. Notwithstanding any law, rule or regulation to  the  contrary,  any
  successor  to  the New York Racing Association, Inc. with respect to the
  operation and maintenance of video lottery gaming at Aqueduct  racetrack
  shall  be  deemed the successor to the New York Racing Association, Inc.
  for purposes of being subject to existing contracts and loan agreements,
  if any, entered into by the New York Racing Association,  Inc.  directly
  related  to  the construction, operation, management and distribution of
  revenues of the video lottery gaming facility at Aqueduct racetrack.
    e. The video lottery gaming  operator  selected  to  operate  a  video
  lottery terminal facility at Aqueduct will be subject to a memorandum of
  understanding  between  the  governor, temporary president of the senate
  and the speaker of the assembly.  Notwithstanding  subparagraph  (i)  of
  paragraph  a  of  subdivision eight of section two hundred twelve of the
  racing, pari-mutuel wagering and breeding law, the state, pursuant to an
  agreement with the video lottery gaming  operator  to  operate  a  video
  lottery  terminal  facility  at Aqueduct, may authorize, as part of such
  agreement or in conjunction with  such  agreement  at  the  time  it  is
  executed,  additional  development  at the Aqueduct racing facility. The
  selection will be made in consultation with the franchised  corporation,
  but  is  not  subject  to  such  corporation's  approval. The franchised
  corporation shall not be eligible to compete to operate or to operate  a
  video lottery terminal facility at Aqueduct. The state will use its best
  efforts  to  ensure that the video lottery terminal facility at Aqueduct
  is opened as soon as is practicable and will, if practicable, pursue the
  construction of a temporary video lottery terminal facility at  Aqueduct
  subject  to  staying  within  an  agreed  budget  for such video lottery
  terminal facility and subject to such temporary facility not  having  an
  adverse  impact  on  opening  of  the permanent facility at Aqueduct. To
  facilitate the opening of the video lottery gaming facility at  Aqueduct
  as  soon  as  is practicable, the division of the lottery may extend the
  term of any existing contract related to the video lottery system.
    f. As consideration for the operation  of  the  video  lottery  gaming
  facility  at Aqueduct racetrack, the division shall cause the investment
  in the racing industry of the following percentages of the vendor fee to
  be deposited or paid, as follows:
    1. Six and one-half percent of  the  total  wagered  after  payout  of
  prizes  for  the  first  year  of  operation  of video lottery gaming at
  Aqueduct racetrack, seven percent of the total wagered after  payout  of
  prizes  for the second year of operation, and seven and one-half percent
  of the total wagered after payout  of  prizes  for  the  third  year  of
  operation  and  thereafter,  for  the  purpose  of  enhancing  purses at
  Aqueduct racetrack, Belmont Park racetrack and Saratoga race course.
    2. One percent of the total wagered after payout  of  prizes  for  the
  first  year  of operation of video lottery gaming at Aqueduct racetrack,
  one and one-quarter percent of the total wagered after payout of  prizes
  for  the  second  year of operation, and one and one-half percent of the
  total wagered after payout of prizes for the third year of operation and
  thereafter, for an appropriate breeding fund for the  manner  of  racing
  conducted  at  Aqueduct  racetrack,  Belmont Park racetrack and Saratoga
  race course.

    3. Four percent of the total revenue wagered after payout of prizes to
  be deposited into an account of the franchised  corporation  established
  pursuant  to section two hundred six of the racing, pari-mutuel wagering
  and breeding law to be used for capital expenditures in maintaining  and
  upgrading  Aqueduct  racetrack, Belmont Park racetrack and Saratoga race
  course.
    4. Three percent of the total revenue wagered after payout for  prizes
  to   be   deposited  into  an  account  of  the  franchised  corporation
  established  pursuant  to  section  two  hundred  six  of  the   racing,
  pari-mutuel   wagering   and   breeding  law  to  be  used  for  general
  thoroughbred racing  operations  at  Aqueduct  racetrack,  Belmont  Park
  racetrack and Saratoga race course.
    5.  Paragraphs  one,  two, three and four of this subdivision shall be
  known collectively as the "racing support payments".
    g. In the event the state elects to construct a video lottery terminal
  facility at the Aqueduct racetrack, all video lottery terminal  revenues
  payable  to  the video lottery gaming operator at the Aqueduct racetrack
  remaining after payment of the racing support payments  shall  first  be
  used  to  repay the state's advances for (i) confirmation of the chapter
  eleven plan of reorganization  and  cash  advances  for  the  franchised
  corporation's  operations  following  confirmation of the chapter eleven
  plan of reorganization and (ii) the amount  expended  by  the  state  to
  construct  such  video  lottery  terminal facility at Aqueduct racetrack
  pursuant to an agreement with the state. Subparagraphs (i) and  (ii)  of
  this  paragraph  shall  be  defined  as the state advance amount and the
  amounts payable to the division of the lottery.