Procedures for Oversight of the Horseracing Integrity and Safety Authority's Annual Budget, 8530-8533 [2024-02290]
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(b) If not previously provided to the
requestor for inclusion with the
requestor’s submission of the request to
the Executive Secretary, any CBP
comments on the request shall be
provided to the Executive Secretary
within 20 days of the requestor’s
submission of the request to the
Executive Secretary.
§ 400.42
[Amended]
21. In § 400.42, remove and reserve
paragraph (b).
■
§ 400.43
[Amended]
22. In § 400.43, remove paragraph (i).
■ 23. In § 400.44:
■ a. Revise paragraphs (a), (b)(5), and
(e); and
■ b. Remove paragraph (f).
The revisions read as follows:
■
§ 400.44
§ 400.52
Zone schedule.
(a) The zone grantee shall submit to
the Executive Secretary (electronic copy
or as specified by the Executive
Secretary) a zone schedule which sets
forth the elements required in this
section. No element of a zone schedule
(including any amendment to the zone
schedule) may be considered to be in
effect until such submission has
occurred. If warranted, the Board may
subsequently amend the requirements of
this section by Board Order.
(b) * * *
(5) Information identifying any
operator which offers services to the
public and which has requested that its
information be included in the zone
schedule; and
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(e) A complete copy of the zone
schedule shall be freely available for
public inspection at the offices of the
zone grantee. The Board shall make
copies of zone schedules available on its
website.
■ 24. In § 400.45, revise paragraph (b) to
read as follows:
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(b) Objections to rates and charges. A
zone participant showing good cause
may object to any rate or charge related
to the zone on the basis that it is not fair
and reasonable by submitting to the
Executive Secretary a complaint in
writing with supporting information. If
necessary, such a complaint may be
made on a confidential basis pursuant to
paragraph (a) of this section. The
Executive Secretary shall review the
complaint and issue a report and
decision, which shall be final unless
appealed to the Board within 30 days.
The Board or the Executive Secretary
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Notices and hearings.
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(b) * * *
(2) The request must be made within
30 days of the beginning of the initial
period for public comment (see
§ 400.32) and must be accompanied by
information establishing the need for
the hearing and the basis for the
requesting party’s interest in the matter.
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■ 26. In § 400.61, revise paragraphs (a)
and (c) to read as follows:
§ 400.61
Revocation of authority.
(a) In general. As provided in this
section, the Board can revoke in whole
or in part authority for a zone (see
§ 400.2(h)) whenever it determines that
the zone grantee has violated,
repeatedly and willfully, the provisions
of the Act.
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(c) Appeals. As provided in section 18
of the Act (19 U.S.C. 81r(c)), the grantee
of the zone in question may appeal an
order of the Board revoking authority.
[FR Doc. 2024–01953 Filed 2–7–24; 8:45 am]
BILLING CODE 3510–DS–P
§ 400.45 Complaints related to public
utility and uniform treatment.
VerDate Sep<11>2014
may otherwise initiate a review for
cause. The primary factor considered in
reviewing fairness and reasonableness is
the cost of the specific services
rendered. Where those costs incorporate
charges to the grantee by one or more
parties undertaking functions on behalf
of the grantee, the Board may consider
the costs incurred by those parties or
evidence regarding market rates for the
undertaking of those functions. The
Board may rely on best estimates, as
necessary. The Board will also give
consideration to any extra costs
incurred relative to non-zone
operations, including return on
investment and reasonable out-of-pocket
expenses.
■ 25. In § 400.52, revise paragraph (b)(2)
to read as follows:
FEDERAL TRADE COMMISSION
16 CFR Part 1
RIN 3084–AB79
Procedures for Oversight of the
Horseracing Integrity and Safety
Authority’s Annual Budget
Federal Trade Commission.
Final rule.
AGENCY:
ACTION:
The Federal Trade
Commission (‘‘FTC’’ or ‘‘Commission’’)
is amending its rules pursuant to the
Horseracing Integrity and Safety Act
SUMMARY:
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(‘‘Act’’) regarding the Commission’s
procedures for its oversight of the
annual budget of the Horseracing
Integrity and Safety Authority
(‘‘Authority’’). The amendments to the
Authority’s budget oversight rules will
streamline and improve the process for
approving or disapproving the
Authority’s annual budget.
DATES: This rule is effective on February
8, 2024.
FOR FURTHER INFORMATION CONTACT:
Sarah Botha, Attorney ((202–326–2036),
sbotha@ftc.gov), Office of the Executive
Director, Federal Trade Commission.
SUPPLEMENTARY INFORMATION:
Background
The Horseracing Integrity and Safety
Act of 2020, Public Law 116–260, Title
XII, 134 Stat 1182, 3252 (2020) (codified
as amended at 15 U.S.C. 3051–3060),
recognizes the Authority as a selfregulatory nonprofit organization
charged with developing and enforcing
rules relating to racetrack safety, antidoping, and medication control. See 15
U.S.C. 3052. The Act expressly provides
for Commission oversight of several
aspects of the Authority’s operations.
For example, the Commission must
approve any proposed rule or rule
modification by the Authority relating
to the Authority’s bylaws, racetrack
safety standards, anti-doping and
medication control, and the formula or
methodology for determining
assessments. See id. In December 2022,
Congress amended HISA to expand the
Commission’s oversight role over the
Authority. See Consolidated
Appropriations Act, 2023, Public Law
117–328, Sec. 701, 136 Stat. 4459, 5231
(2022). As amended, the Act gives the
Commission the power to issue rules
under the procedures set forth in the
Administrative Procedure Act, 5 U.S.C.
553, ‘‘as the Commission finds
necessary or appropriate to ensure the
fair administration of the Authority . . .
or otherwise in furtherance of the
purposes of this Act.’’ 15 U.S.C. 3053(e).
In March 2023, relying in part on the
new amendment, the Commission
promulgated rules relating to the
Authority’s budget (‘‘Budget Rule’’). See
88 FR 18034 (Mar. 27, 2023). The
Budget Rule, codified at 16 CFR 1.150
through 1.152, sets forth the process
whereby the Authority submits each
year’s proposed budget to the
Commission for approval. Under the
Budget Rule, after the Authority submits
its proposed annual budget to the
Commission, the Commission publishes
the proposed budget in the Federal
Register and the public is given an
opportunity to comment. See 16 CFR
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1.150(d). After the close of the comment
period, and after consideration of any
comments received, the Commission
either approves or disapproves the
proposed budget, using the criteria set
forth in 16 CFR 1.151(c).
In June 2023, after the Commission
promulgated the Budget Rule, the
Authority submitted its proposed 2023
budget to the Commission, and the
Commission published the proposed
budget in the Federal Register. See 88
FR 68610 (Oct. 4, 2023). After
considering the Authority’s budget
submission and the public comments
received, the Commission approved the
Authority’s 2023 budget on December 5,
2023.1 In September 2023, the Authority
submitted its proposed 2024 budget to
the Commission, and the Commission
published the proposed budget in the
Federal Register. See 88 FR 77582 (Nov.
13, 2023). The Commission reviewed
the Authority’s budget submission and
the public comments and approved the
Authority’s 2024 budget on January 5,
2024.2
Based on comments received in
response to the publication of the 2023
and 2024 budgets, and in light of
Commission experience in reviewing
the two budgets, the Commission is
revising the Budget Rule, 16 CFR 1.150
through 1.152. The revisions to the Rule
streamline the budget approval process
by, among other things, providing for
the immediate publication of the
Authority’s proposed budget in the
Federal Register so long as certain
procedural requirements are met. The
amendments to the budget approval
process still allow for meaningful public
comment, and the Commission will still
need to closely review the Authority’s
finances. Commission approval of the
budget will happen only after the
Commission is satisfied that the budget
is consistent with and serves the goals
of the Act in a prudent and costeffective manner.
Finally, the Commission is modifying
§ 1.143, the section setting forth the
formatting requirements for the
Authority’s submissions to the
Commission, to account for the
submissions mandated by §§ 1.150
through 1.152.
1 FTC, Order Approving the Budget for 2023
Proposed by the Horseracing Integrity and Safety
Authority (Dec. 5, 2023), available at https://
www.ftc.gov/system/files/ftc_gov/pdf/
P222100CommissionOrderApprovingHISA2023
Budget.pdf.
2 FTC, Order Approving the Budget for 2024
Proposed by the Horseracing Integrity and Safety
Authority (Jan. 5, 2024), available at https://
www.ftc.gov/system/files/ftc_gov/pdf/P222100
CommissionOrder2024HISABudget.pdf.
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Section by Section Analysis
§ 1.143 Submissions to the
Secretary. Section 1.143 currently sets
forth the procedures whereby the
Authority submits guidance, proposed
rate increases, and proposed rules or
rule modifications to the Commission.
The Commission is modifying this
section to account for the Authority’s
submissions required by the Budget
Rule.
§ 1.150 Submission of the
Authority’s proposed budget.
Modifications to paragraph (a) change
the budget submission date from
September 1 to August 1 to give the FTC
additional time to review the
Authority’s proposed budget. Changes
to paragraph (b) clarify that the
Authority does not have to post public
comments to its website upon their
arrival, but must still post comments on
its website. Also, the Commission is
moving from paragraph (b) to paragraph
(c) the requirement that the Authority
forward to the FTC any public
comments received by the Authority
and the Authority’s response to them.
The changes to paragraph (d) delegate to
the Secretary the authority to publish
the proposed budget in the Federal
Register without a Commission vote.
The Commission will still vote to
approve or disapprove the budget after
the public comment period has ended
and the Commission has reviewed the
comments submitted. The Commission
also clarifies that while the proposed
budget will still be published in the
Federal Register, supporting materials
will be made available to the public on
regulations.gov.
§ 1.151 Commission’s decision on
the Authority’s proposed budget.
Modifications to this section clarify that
the Commission may require the
Authority to submit additional
information before the Commission
approves or disapproves the proposed
budget, and that the Commission will
vote on the Authority’s proposed budget
no later than November 1, or as soon as
practicable thereafter. Changes also
remove the ‘‘commercially reasonable
terms’’ element from the Commission’s
decision criteria. In lieu of this criterion,
the FTC today proposes new provisions
addressing oversight of the Authority’s
operations, which would include more
specific vendor selection and
competition requirements.3
§ 1.152 Deviation from approved
budget. An edit in paragraph (a) clarifies
that the Authority may deviate from the
3 Horseracing Integrity and Safety Authority
Oversight, Notice of Proposed Rulemaking,
published elsewhere in this issue of the Federal
Register.
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approved budget’s expenditure
information in a year as to any line item
by up to 10 percent in a year without
notifying the Commission. Edits in
paragraphs (b) and (c) change the
deadlines from 7 business days to 14
business days for the Commission to
issue any decision to disapprove a
proposed repurposing of funds to cover
a line-item deviation of more than 10
percent and for the Commission to issue
any decision to disapprove a proposed
means of covering a difference in the
total approved expenditure.
Because these rules relate solely to
agency procedure and practice,
publication for notice and comment is
not required under the Administrative
Procedure Act. 5 U.S.C. 553(b).4
List of Subjects in 16 CFR Part 1
Administrative practice and
procedure; Animal drugs; Animal
welfare.
For the reasons set forth in the
preamble, the Federal Trade
Commission amends part 1, title 16,
chapter I, subchapter A of the Code of
Federal Regulations as follows:
PART 1—GENERAL PROCEDURES
1. The authority citation for part 1
continues to read as follows:
■
Authority: 15 U.S.C. 46; 15 U.S.C. 57a; 5
U.S.C. 552; 5 U.S.C. 601 note.
2. Amend § 1.143 by revising
paragraph (a), paragraph (b) paragraph
heading, (b)(1), (e), and (f) of to read as
follows:
■
§ 1.143
Submissions to the Secretary.
(a) Electronic submission. All
submissions from the Authority to the
Commission pursuant to the provisions
of subpart S or U of this part, and all
submissions to the Commission
pursuant to 15 U.S.C. 3053(a) (proposed
rules or rule modifications), 15 U.S.C.
3052(f)(1)(C)(iv) (proposed rate
increases), or 15 U.S.C. 3054(g)(2)
(guidance) must be emailed to the
Secretary of the Commission at
electronicfilings@ftc.gov. The subject
line of the email must begin with ‘‘HISA
Submission:’’ followed by a brief
description of the submission.
(b) Format for submissions—(1)
Electronic format. All documents
submitted to the Secretary under this
section must be submitted in .pdf format
or in some other electronic format
specified by the Office of the Secretary.
4 For this reason, the requirements of the
Regulatory Flexibility Act, 5 U.S.C. 601(2), 604(a),
are also inapplicable. Likewise, the amendments do
not modify any FTC collections of information
within the meaning of the Paperwork Reduction
Act, 44 U.S.C. 3501 through 3521.
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The proposed text of Federal Register
publications must also be submitted in
a Microsoft Word or .rtf format.
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(e) Authority to reject documents for
filing. The Secretary of the Commission
may reject a document for filing that
fails to comply with the Commission’s
rules.
(f) Federal Register publication. For
submissions required to be published in
the Federal Register, if the conditions
set forth in this section and § 1.142 have
been satisfied, the Commission will
publish the Authority’s submission in
the Federal Register.
■ 3. Revise subpart U to read as follows:
Subpart U—Procedures for Oversight
of the Horseracing Integrity and Safety
Authority’s Annual Budget
Sec.
1.150 Submission of the Authority’s
proposed budget
1.151 Commission decision on the
Authority’s proposed budget
1.152 Deviation from approved budget
Authority: 15 U.S.C. 3053(e).
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§ 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 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) Consideration of public comments.
Before submitting its proposed budget to
the Commission in August, the
Authority must post the proposed
budget on its website as early as
practicable, with an invitation to the
public to submit comments to the
Authority on any aspect of the proposed
budget. The Authority must post any
pertinent comments it receives on its
website, and it must review them to
ascertain whether to revise the proposed
budget in 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 a budget that
exceeds the preceding year’s budget by
5 percent or more, a two-thirds
supermajority. The Authority’s
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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. For
each approved line item, the proposed
budget must provide a comparison
showing 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.
(6) 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
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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 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.
§ 1.151 Commission decision on the
Authority’s proposed budget.
(a) Commission approval required.
The Authority’s proposed budget takes
effect only if approved by the
Commission. The Commission will
approve or disapprove the proposed
budget after considering the public
comments filed and the Commission’s
internal review of the Authority’s
submissions pursuant to § 1.150. The
Commission may, in its discretion,
require the Authority to submit
additional information to the
Commission before the Commission
approves or disapproves the proposed
budget. The Commission will vote on
the Authority’s proposed budget no later
than November 1, or as soon thereafter
as practicable.
(b) Conditional collection of fees
allowed. The notice required to be sent
to State racing commissions estimating
the amount required from each State for
the subsequent year must state that the
amount required is based on the
proposed annual budget, as approved by
the Board of Directors, which takes
effect only if approved by the
Commission. State racing commissions
(or covered persons in States that do not
elect to remit fees) may nevertheless
elect to remit fees, and the Authority
may conditionally collect them, even
before the Commission approves the
proposed budget. If the Commission
makes any modifications to line items
under paragraph (d) of this section that
have the net effect of reducing the
budget, the Authority must, within 30
days, refund the proportionate amount
owed to any State racing commission or
covered person that has conditionally
paid. If the Commission makes any
modifications to line items under
paragraph (d) of this section that have
the net effect of increasing the budget,
the Authority may obtain loans to make
up the difference or may account for the
difference as a funding shortfall
incurred in the subsequent year’s
proposed budget.
(c) Decisional criteria. The
Commission will approve the proposed
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budget if the Commission determines
that, on balance, the proposed budget is
consistent with and serves the goals of
the Horseracing Integrity and Safety Act
in a prudent and cost-effective manner
and that its anticipated revenues are
sufficient to meet its anticipated
expenditures.
(d) Modification of line items. In its
decision on the proposed budget, the
Commission may modify the amount of
any line item.
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§ 1.152
Deviation from approved budget.
(a) When notice to the Commission is
required. As to any line item, the
Authority may deviate from the
approved budget’s expenditure
information in a year by up to 10
percent in a year without providing
prior notification to the Commission. If
the Authority determines that it is likely
to expend more than the approved
expenditure for any line item by 10
percent or more, or if it will exceed its
approved total expenditure by any
amount, it must notify the Commission
immediately upon such a
determination.
(b) Line-item deviations of more than
10 percent. If the Authority determines
that it is likely to expend more than the
approved expenditure for any line item
by 10 percent or more, its notice to the
Commission must indicate whether it
intends to repurpose funds from one or
more different line items to cover the
increased expenditure. The Commission
retains the discretion to disapprove
such a proposed repurposing. The
Commission must issue any decision to
disapprove a proposed repurposing
within 14 business days of receiving
notice of the Authority’s proposal to
repurpose funds from another line item.
If the Commission takes no action, the
Authority’s proposal takes effect as an
amendment to its approved budget.
(c) Total expenditure deviation. If the
Authority determines that it is likely to
expend more than the total approved
expenditure, its notice to the
Commission must indicate by what
means it proposes to cover the
difference. The Commission retains the
discretion to disapprove the proposed
means of covering the difference. The
Commission must issue any decision to
disapprove a proposed means of
covering the difference within 14
business days of receiving notice of the
Authority’s proposal to cover the
difference. If the Commission takes no
action, the Authority’s proposal takes
effect as an amendment to its approved
budget.
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By direction of the Commission,
Joel Christie,
Acting Secretary.
[FR Doc. 2024–02290 Filed 2–7–24; 8:45 am]
BILLING CODE 6750–01–P
DEPARTMENT OF LABOR
Office of the Secretary
20 CFR Part 802
RIN 1290–AA35
Rules of Practice and Procedure
Before the Benefits Review Board
Office of the Secretary,
Department of Labor.
ACTION: Final rule.
AGENCY:
This action finalizes the
Department of Labor’s (DOL or
Department) proposal, published on
January 11, 2021, to require electronic
filing (e-filing) in proceedings before the
Benefits Review Board (BRB). On
January 11, 2021, the Department
published a direct final rule (DFR) and
companion proposed rule to require efiling and make acceptance of electronic
service (e-service) automatic by
attorneys and lay representatives
representing parties in proceedings
before the BRB, and to provide an
option for self-represented parties to
utilize these electronic capabilities. The
rule provided an exception to the
requirements for good cause shown. The
Department invited written comments
from the public for 30 days on the
proposed rule. The Department received
significant adverse public comments
from stakeholders on the similar direct
final rule for the Office of
Administrative Law Judges (OALJ). As
many of these stakeholders also practice
before the BRB, the BRB withdrew the
direct final rule on February 25, 2021.
The Department has reviewed the
comments received in response to the
proposal and is now implementing the
rule as described in the proposed rule
of January 11, 2021, with appropriate
exceptions for good cause shown and
self-represented parties.
DATES: This final rule is effective on
March 11, 2024.
FOR FURTHER INFORMATION CONTACT: Mr.
Thomas Shepherd, Clerk of the
Appellate Boards, at 202–693–6319.
SUPPLEMENTARY INFORMATION: This
preamble is divided into three sections:
Section I provides an overview of this
rulemaking and describes its procedural
background; Section II provides a
summary of the public comments
received; and Section III covers the
SUMMARY:
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administrative requirements for this
rulemaking.
I. Background
A. Overview
This action is a final rule to finalize
the corresponding notice of proposed
rulemaking (NPRM) published in the
January 11, 2021, issue of the Federal
Register. The e-filing amendments are
revising Part 802 in order to require efiling and allow for automatic e-service.
A general overview of the legal
framework, statements explaining the
necessity of this e-filing and e-service
rule, and further background on the
rulemaking is available in the
Department’s NPRM, as published in
the Federal Register on January 11,
2021, and will not be restated in full
herein.
In brief, this final rule requires
persons represented by attorney and
non-attorney representatives to use the
Department’s system to file all papers
electronically and to receive electronic
service of documents unless another
form of filing or service is allowed by
the BRB for good cause; gives selfrepresented persons the option to use
conventional means of filing, or to use
the Department’s system to file all
papers electronically and to receive
electronic service of documents; and
provides that a filing made through a
person’s eFile/eServe system account
and authorized by that person, together
with that person’s name on a signature
block, constitutes that person’s
signature.
B. Procedural History
On January 11, 2021, the Department
initially published the e-filing
amendments as a DFR without a prior
proposal because the Department
viewed such amendments as
noncontroversial at that time and
anticipated no adverse comment. The
Department also published a companion
NPRM in the ‘‘Proposed Rules’’ section
of the January 11, 2021, issue to
expedite notice-and-comment
rulemaking in case significant adverse
comments were received from
stakeholders. A significant adverse
comment for the purposes of these
notices is one that explains (1) why the
rule is inappropriate, including
challenges to the rule’s underlying
premise or approach; or (2) why the
direct final rule will be ineffective or
unacceptable without a change. The
proposed and direct final rules were
substantively identical, and their
respective comment periods ran
concurrently. The Department is
treating comments received on the
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]]>Agencies
[Federal Register Volume 89, Number 27 (Thursday, February 8, 2024)]
[Rules and Regulations]
[Pages 8530-8533]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-02290]
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FEDERAL TRADE COMMISSION
16 CFR Part 1
RIN 3084-AB79
Procedures for Oversight of the Horseracing Integrity and Safety
Authority's Annual Budget
AGENCY: Federal Trade Commission.
ACTION: Final rule.
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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') is
amending its rules pursuant to the Horseracing Integrity and Safety Act
(``Act'') regarding the Commission's procedures for its oversight of
the annual budget of the Horseracing Integrity and Safety Authority
(``Authority''). The amendments to the Authority's budget oversight
rules will streamline and improve the process for approving or
disapproving the Authority's annual budget.
DATES: This rule is effective on February 8, 2024.
FOR FURTHER INFORMATION CONTACT: Sarah Botha, Attorney ((202-326-2036),
[email protected]), Office of the Executive Director, Federal Trade
Commission.
SUPPLEMENTARY INFORMATION:
Background
The Horseracing Integrity and Safety Act of 2020, Public Law 116-
260, Title XII, 134 Stat 1182, 3252 (2020) (codified as amended at 15
U.S.C. 3051-3060), recognizes the Authority as a self-regulatory
nonprofit organization charged with developing and enforcing rules
relating to racetrack safety, anti-doping, and medication control. See
15 U.S.C. 3052. The Act expressly provides for Commission oversight of
several aspects of the Authority's operations. For example, the
Commission must approve any proposed rule or rule modification by the
Authority relating to the Authority's bylaws, racetrack safety
standards, anti-doping and medication control, and the formula or
methodology for determining assessments. See id. In December 2022,
Congress amended HISA to expand the Commission's oversight role over
the Authority. See Consolidated Appropriations Act, 2023, Public Law
117-328, Sec. 701, 136 Stat. 4459, 5231 (2022). As amended, the Act
gives the Commission the power to issue rules under the procedures set
forth in the Administrative Procedure Act, 5 U.S.C. 553, ``as the
Commission finds necessary or appropriate to ensure the fair
administration of the Authority . . . or otherwise in furtherance of
the purposes of this Act.'' 15 U.S.C. 3053(e).
In March 2023, relying in part on the new amendment, the Commission
promulgated rules relating to the Authority's budget (``Budget Rule'').
See 88 FR 18034 (Mar. 27, 2023). The Budget Rule, codified at 16 CFR
1.150 through 1.152, sets forth the process whereby the Authority
submits each year's proposed budget to the Commission for approval.
Under the Budget Rule, after the Authority submits its proposed annual
budget to the Commission, the Commission publishes the proposed budget
in the Federal Register and the public is given an opportunity to
comment. See 16 CFR
[[Page 8531]]
1.150(d). After the close of the comment period, and after
consideration of any comments received, the Commission either approves
or disapproves the proposed budget, using the criteria set forth in 16
CFR 1.151(c).
In June 2023, after the Commission promulgated the Budget Rule, the
Authority submitted its proposed 2023 budget to the Commission, and the
Commission published the proposed budget in the Federal Register. See
88 FR 68610 (Oct. 4, 2023). After considering the Authority's budget
submission and the public comments received, the Commission approved
the Authority's 2023 budget on December 5, 2023.\1\ In September 2023,
the Authority submitted its proposed 2024 budget to the Commission, and
the Commission published the proposed budget in the Federal Register.
See 88 FR 77582 (Nov. 13, 2023). The Commission reviewed the
Authority's budget submission and the public comments and approved the
Authority's 2024 budget on January 5, 2024.\2\
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\1\ FTC, Order Approving the Budget for 2023 Proposed by the
Horseracing Integrity and Safety Authority (Dec. 5, 2023), available
at https://www.ftc.gov/system/files/ftc_gov/pdf/P222100CommissionOrderApprovingHISA2023Budget.pdf.
\2\ FTC, Order Approving the Budget for 2024 Proposed by the
Horseracing Integrity and Safety Authority (Jan. 5, 2024), available
at https://www.ftc.gov/system/files/ftc_gov/pdf/P222100CommissionOrder2024HISABudget.pdf.
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Based on comments received in response to the publication of the
2023 and 2024 budgets, and in light of Commission experience in
reviewing the two budgets, the Commission is revising the Budget Rule,
16 CFR 1.150 through 1.152. The revisions to the Rule streamline the
budget approval process by, among other things, providing for the
immediate publication of the Authority's proposed budget in the Federal
Register so long as certain procedural requirements are met. The
amendments to the budget approval process still allow for meaningful
public comment, and the Commission will still need to closely review
the Authority's finances. Commission approval of the budget will happen
only after the Commission is satisfied that the budget is consistent
with and serves the goals of the Act in a prudent and cost-effective
manner.
Finally, the Commission is modifying Sec. 1.143, the section
setting forth the formatting requirements for the Authority's
submissions to the Commission, to account for the submissions mandated
by Sec. Sec. 1.150 through 1.152.
Section by Section Analysis
Sec. 1.143 Submissions to the Secretary. Section 1.143 currently
sets forth the procedures whereby the Authority submits guidance,
proposed rate increases, and proposed rules or rule modifications to
the Commission. The Commission is modifying this section to account for
the Authority's submissions required by the Budget Rule.
Sec. 1.150 Submission of the Authority's proposed budget.
Modifications to paragraph (a) change the budget submission date from
September 1 to August 1 to give the FTC additional time to review the
Authority's proposed budget. Changes to paragraph (b) clarify that the
Authority does not have to post public comments to its website upon
their arrival, but must still post comments on its website. Also, the
Commission is moving from paragraph (b) to paragraph (c) the
requirement that the Authority forward to the FTC any public comments
received by the Authority and the Authority's response to them. The
changes to paragraph (d) delegate to the Secretary the authority to
publish the proposed budget in the Federal Register without a
Commission vote. The Commission will still vote to approve or
disapprove the budget after the public comment period has ended and the
Commission has reviewed the comments submitted. The Commission also
clarifies that while the proposed budget will still be published in the
Federal Register, supporting materials will be made available to the
public on regulations.gov.
Sec. 1.151 Commission's decision on the Authority's proposed
budget. Modifications to this section clarify that the Commission may
require the Authority to submit additional information before the
Commission approves or disapproves the proposed budget, and that the
Commission will vote on the Authority's proposed budget no later than
November 1, or as soon as practicable thereafter. Changes also remove
the ``commercially reasonable terms'' element from the Commission's
decision criteria. In lieu of this criterion, the FTC today proposes
new provisions addressing oversight of the Authority's operations,
which would include more specific vendor selection and competition
requirements.\3\
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\3\ Horseracing Integrity and Safety Authority Oversight, Notice
of Proposed Rulemaking, published elsewhere in this issue of the
Federal Register.
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Sec. 1.152 Deviation from approved budget. An edit in paragraph
(a) clarifies that the Authority may deviate from the approved budget's
expenditure information in a year as to any line item by up to 10
percent in a year without notifying the Commission. Edits in paragraphs
(b) and (c) change the deadlines from 7 business days to 14 business
days for the Commission to issue any decision to disapprove a proposed
repurposing of funds to cover a line-item deviation of more than 10
percent and for the Commission to issue any decision to disapprove a
proposed means of covering a difference in the total approved
expenditure.
Because these rules relate solely to agency procedure and practice,
publication for notice and comment is not required under the
Administrative Procedure Act. 5 U.S.C. 553(b).\4\
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\4\ For this reason, the requirements of the Regulatory
Flexibility Act, 5 U.S.C. 601(2), 604(a), are also inapplicable.
Likewise, the amendments do not modify any FTC collections of
information within the meaning of the Paperwork Reduction Act, 44
U.S.C. 3501 through 3521.
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List of Subjects in 16 CFR Part 1
Administrative practice and procedure; Animal drugs; Animal
welfare.
For the reasons set forth in the preamble, the Federal Trade
Commission amends part 1, title 16, chapter I, subchapter A of the Code
of Federal Regulations as follows:
PART 1--GENERAL PROCEDURES
0
1. The authority citation for part 1 continues to read as follows:
Authority: 15 U.S.C. 46; 15 U.S.C. 57a; 5 U.S.C. 552; 5 U.S.C.
601 note.
0
2. Amend Sec. 1.143 by revising paragraph (a), paragraph (b) paragraph
heading, (b)(1), (e), and (f) of to read as follows:
Sec. 1.143 Submissions to the Secretary.
(a) Electronic submission. All submissions from the Authority to
the Commission pursuant to the provisions of subpart S or U of this
part, and all submissions to the Commission pursuant to 15 U.S.C.
3053(a) (proposed rules or rule modifications), 15 U.S.C.
3052(f)(1)(C)(iv) (proposed rate increases), or 15 U.S.C. 3054(g)(2)
(guidance) must be emailed to the Secretary of the Commission at
[email protected]. The subject line of the email must begin
with ``HISA Submission:'' followed by a brief description of the
submission.
(b) Format for submissions--(1) Electronic format. All documents
submitted to the Secretary under this section must be submitted in .pdf
format or in some other electronic format specified by the Office of
the Secretary.
[[Page 8532]]
The proposed text of Federal Register publications must also be
submitted in a Microsoft Word or .rtf format.
* * * * *
(e) Authority to reject documents for filing. The Secretary of the
Commission may reject a document for filing that fails to comply with
the Commission's rules.
(f) Federal Register publication. For submissions required to be
published in the Federal Register, if the conditions set forth in this
section and Sec. 1.142 have been satisfied, the Commission will
publish the Authority's submission in the Federal Register.
0
3. Revise subpart U to read as follows:
Subpart U--Procedures for Oversight of the Horseracing Integrity
and Safety Authority's Annual Budget
Sec.
1.150 Submission of the Authority's proposed budget
1.151 Commission decision on the Authority's proposed budget
1.152 Deviation from approved budget
Authority: 15 U.S.C. 3053(e).
Sec. 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 August 1 of the current year,
following the procedures set forth in Sec. 1.143. The Authority's
annual budget will use the calendar year as its fiscal year.
(b) Consideration of public comments. Before submitting its
proposed budget to the Commission in August, the Authority must post
the proposed budget on its website as early as practicable, with an
invitation to the public to submit comments to the Authority on any
aspect of the proposed budget. The Authority must post any pertinent
comments it receives on its website, and it must review them to
ascertain whether to revise the proposed budget in 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
a budget that exceeds the preceding year's budget by 5 percent or more,
a two-thirds supermajority. 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. For each approved line item, the proposed budget must
provide a comparison showing 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.
(6) 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
Sec. 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 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 Sec. 1.151(c) and whether any line
items should be modified.
Sec. 1.151 Commission decision on the Authority's proposed budget.
(a) Commission approval required. The Authority's proposed budget
takes effect only if approved by the Commission. The Commission will
approve or disapprove the proposed budget after considering the public
comments filed and the Commission's internal review of the Authority's
submissions pursuant to Sec. 1.150. The Commission may, in its
discretion, require the Authority to submit additional information to
the Commission before the Commission approves or disapproves the
proposed budget. The Commission will vote on the Authority's proposed
budget no later than November 1, or as soon thereafter as practicable.
(b) Conditional collection of fees allowed. The notice required to
be sent to State racing commissions estimating the amount required from
each State for the subsequent year must state that the amount required
is based on the proposed annual budget, as approved by the Board of
Directors, which takes effect only if approved by the Commission. State
racing commissions (or covered persons in States that do not elect to
remit fees) may nevertheless elect to remit fees, and the Authority may
conditionally collect them, even before the Commission approves the
proposed budget. If the Commission makes any modifications to line
items under paragraph (d) of this section that have the net effect of
reducing the budget, the Authority must, within 30 days, refund the
proportionate amount owed to any State racing commission or covered
person that has conditionally paid. If the Commission makes any
modifications to line items under paragraph (d) of this section that
have the net effect of increasing the budget, the Authority may obtain
loans to make up the difference or may account for the difference as a
funding shortfall incurred in the subsequent year's proposed budget.
(c) Decisional criteria. The Commission will approve the proposed
[[Page 8533]]
budget if the Commission determines that, on balance, the proposed
budget is consistent with and serves the goals of the Horseracing
Integrity and Safety Act in a prudent and cost-effective manner and
that its anticipated revenues are sufficient to meet its anticipated
expenditures.
(d) Modification of line items. In its decision on the proposed
budget, the Commission may modify the amount of any line item.
Sec. 1.152 Deviation from approved budget.
(a) When notice to the Commission is required. As to any line item,
the Authority may deviate from the approved budget's expenditure
information in a year by up to 10 percent in a year without providing
prior notification to the Commission. If the Authority determines that
it is likely to expend more than the approved expenditure for any line
item by 10 percent or more, or if it will exceed its approved total
expenditure by any amount, it must notify the Commission immediately
upon such a determination.
(b) Line-item deviations of more than 10 percent. If the Authority
determines that it is likely to expend more than the approved
expenditure for any line item by 10 percent or more, its notice to the
Commission must indicate whether it intends to repurpose funds from one
or more different line items to cover the increased expenditure. The
Commission retains the discretion to disapprove such a proposed
repurposing. The Commission must issue any decision to disapprove a
proposed repurposing within 14 business days of receiving notice of the
Authority's proposal to repurpose funds from another line item. If the
Commission takes no action, the Authority's proposal takes effect as an
amendment to its approved budget.
(c) Total expenditure deviation. If the Authority determines that
it is likely to expend more than the total approved expenditure, its
notice to the Commission must indicate by what means it proposes to
cover the difference. The Commission retains the discretion to
disapprove the proposed means of covering the difference. The
Commission must issue any decision to disapprove a proposed means of
covering the difference within 14 business days of receiving notice of
the Authority's proposal to cover the difference. If the Commission
takes no action, the Authority's proposal takes effect as an amendment
to its approved budget.
By direction of the Commission,
Joel Christie,
Acting Secretary.
[FR Doc. 2024-02290 Filed 2-7-24; 8:45 am]
BILLING CODE 6750-01-P
