Chapter 128 of the General Laws is hereby amended by striking out section 2(g) and inserting in place thereof the following:-

(g)Promote, develop and encourage, through the Massachusetts Thoroughbred Breeding Program, the breeding of Thoroughbred horses in the Commonwealth through the Massachusetts Thoroughbred Breeders Association.  The MTBA shall set: (1) the percentages for cash prizes to be awarded to the breeder for a MA-bred Thoroughbred horse, of the purse monies won by said horse in any pari-mutual running horse race in North America, if said horse finishes first, second, or third; (2) the percentage for a cash prize to the owner of the stallion, at the time of service to the dam of such purse winner, provided that said stallion was properly registered with the MTBA at the time of service; (3) the percentage for a cash prize to the owner of said MA-bred Thoroughbred horse if the horse finishes first, second or third in an unrestricted pari-mutual running horse race.

The MTBA is further authorized to pay cash prizes for races to be limited to Massachusetts Bred Thoroughbred race horses, registered with the Jockey Club and the MTBA at licensed pari-mutual race meetings.  Such races may be betting or non-betting races and may or may not be scheduled races by the licensee conducting the race meeting.  Purse monies paid by the MTBA under this section may be in such amounts as the association shall determine and may be the sole cash purse for such races or may be supplemental to the cash purses established by the licensee.  The MTBA shall establish a limit to the amount that any person, partnership, corporation, or group of persons may receive from the association for an individual Thoroughbred horse race within the Commonwealth.

To be eligible for the prizes provided, a person must be a paid-up member of the MTBA or must agree to a one-time annual processing fee.

No person, partnership, corporation, or group of persons shall be eligible for the prizes provided herein unless the following standards are met:

   (1) The thoroughbred foal, properly registered with the Jockey Club and the MTBA shall be the foal of a Thoroughbred mare that dropped said foal in the Commonwealth and was bred back to a Massachusetts stallion registered with the MTBA. Or:

   (2) The Thoroughbred foal, properly registered with the Jockey Club, and the MTBA shall be the foal of a resident Thoroughbred mare that resided continuously in the Commonwealth from the fifteenth day of October of the year of conception.  If an in-foal mare is purchased at public auction prior to December 15 (must be a completed public sale, not an RNA or a private transaction after the public sale), she must be domiciled in the Commonwealth within 14 days of the date of purchase and continue such residence through foaling.

   (3) In either case the mare is required to stay in the Commonwealth for a continuous stay of not less than 60 days before or after foaling.

   (4) Resident in-foal mares require that domicile reports be filed with the MTBA by certified mail by October 15 (or 14 days after date of purchase for mares purchased at public auction prior to December 15).  All changes in domicile and/or ownership must be reported to the MTBA by certified mail within 14 days of the event.

Prior to the first day of August of each year, each person standing a Thoroughbred stallion in the Commonwealth at either public or private service shall file with the MTBA (a) a list of all Thoroughbred mares bred to such stallion in that year; and (b) a verified statement representing that said stallion stood the entire breeding season in the Commonwealth.

All stallions and in-foal mares registered with the MTBA are subject to on-site inspection at any time to ensure domicile status.

The MTBA is authorized to expend up to 12 percent funds for said program for advertising, marketing, promotion, and administration of the Thoroughbred breeding program in the Commonwealth, which may include incentive payments to owners of qualified broodmares and stallions residing in the state of Massachusetts.

The state auditor shall annually audit the books of the MTBA to insure compliance with this section.