(1) To encourage the breeding of horses in the state of Washington, at least one race per race day at Class A, B, and C race meets, whether advertised or not, shall consist exclusively of Washington-bred horses. (RCW 67.16.070)

(2) Only horses certified as Washington-bred, are eligible to run in a Washington-bred only race.

(1) For purposes of the distribution of the owner's bonus and breeder's awards, a Washington-bred horse is one that meets the following requirements:

(a) The horse was foaled within the boundaries of the state of Washington; and

(b) The horse is certified as Washington-bred for its breed or issued a certificate of foal registration by the respective organization listed in subsection (2) of this section.

(2) The following associations are recognized by the commission for the purpose of certification of their respective breed as Washington-bred horses:

(a) The Jockey Club for thoroughbreds;

(b) The American Quarter Horse Association, for quarter horses;

(c) The Appaloosa Horse Club, for appaloosas;

(d) The Arabian Horse Association, for Arabian horses; and

(e) The American Paint Horse Association, for paint horses.

Consistent with the applicable laws in chapter 67.16 RCW and the applicable rules in Title 260 WAC, the Washington-bred owners' bonus and breeder awards will be retained, collected, and distributed as follows:

(1) Washington-bred owner's bonus. A Class 1 racing association will withhold and pay daily to the commission one percent of the gross receipts of all in-state parimutuel machines, including approved satellite locations during the period of its authorized live race meet.

(2) Washington-bred breeder's award. A Class 1 racing association may withhold, in addition to the amounts authorized to be retained in RCW 67.16.170, for each authorized day of racing an additional six percent of the daily gross receipts of all in-state parimutuel machines from exotic wagers at its race meet and approved satellite locations. If a Class 1 racing association does retain an additional six percent of the daily gross receipts of all in-state parimutuel machines from exotic wagers at its race meet, the Class 1 racing association must provide one-sixth of the additional six percent for Washington-bred breeder awards. At the end of its authorized live race meet, a Class 1 racing association must pay to the commission the one-sixth of the additional six percent retained from exotic wagers for Washington-bred breeder's awards.

(3) The race meet will mean the period beginning the first day of live racing and concluding on the last day of live racing, and will include wagering on live races conducted on the grounds of the Class 1 racing association and simulcast wagering conducted during the period of the race meet. It will include wagering on simulcast races conducted during the live race meet, whether or not live racing is being conducted.

(4) The race meet will not include any wagering conducted at a Class 1 racing association or its approved satellite locations beginning the day after the last day of live racing and continuing until the day before the first day of live racing the following race season.

(5) Moneys received by the commission for Washington-bred owner's bonus and breeder's awards shall be deposited in the Washington-bred owner's bonus fund and breeder's award fund account in the custody of the state treasurer. The commission shall distribute the Washington-bred owner's bonus and breeder's awards as provided in WAC 260-16-065.

(1) The one percent Washington-bred owner's bonus funds collected from each racing association must be paid in accordance with RCW 67.16.102 by the commission at the end of the race meet to the licensed owners of Washington-bred horses finishing first, second, third and fourth in the racing association's race meet. The formula for the equitable distribution of the one percent Washington-bred owner's bonus funds will be as follows:

(a) Calculate the payment factor by dividing the total Washington-bred owner's bonus funds collected at the race meet by the total amount of winnings (earnings) of the Washington-bred horses finishing first, second, third, and fourth in the race meet.

(b) Multiply the winnings (earnings) of each Washington-bred owner by the payment factor to determine the amount of the Washington-bred owner's bonus to be paid to the owner.

(2) The Washington-bred breeder's award funds must be collected by the Class A or B racing association as required in RCW 67.16.175, and will be distributed by the commission. The award funds must be paid to the breeder of record of Washington-bred horses finishing first, second, and third in the racing association's race meet. The formula for the distribution of the breeder's awards at each Class A or B racing association will be as follows:

(a) Seventy-five percent of the breeder's award funds will be allocated to those Washington-bred horses finishing first. To calculate the payment factor for first place Washington-bred horses, divide the total Washington-bred breeder award fund allocated to first place finishers at the race meet by the total amount of winnings (earnings) of the Washington-bred horses finishing first at the race meet. Multiply the winnings (earnings) of each Washington-bred breeder by the payment factor to determine the amount of the Washington-bred breeder's award to be paid to the breeder of record.

(b) Fifteen percent of the breeder's award funds will be allocated to those Washington-bred horses finishing second. To calculate the payment factor for second place Washington-bred horses, divide the total Washington-bred breeder award fund allocated to second place finishers at the race meet by the total amount of winnings (earnings) of the Washington-bred horses finishing second at the race meet. Multiply the winnings (earnings) of each Washington-bred breeder by the payment factor to determine the amount of the Washington-bred breeder's award to be paid to the breeder of record.

(c) Ten percent of the breeder's award funds will be allocated to those Washington-bred horses finishing third. To calculate the payment factor for third place Washington-bred horses, divide the total Washington-bred breeder award fund allocated to third place finishers at the race meet by the total amount of winnings (earnings) of the Washington-bred horses finishing third at the race meet. Multiply the winnings (earnings) of each Washington-bred breeder by the payment factor to determine the amount of the Washington-bred breeder's award to be paid to the breeder of record.

(d) The racing association is not required to include any interest or other financial benefit earned during the collection of the breeder's award.

(3) Owner's bonus and breeder's awards must be distributed within ninety days after the end of the race meet at which they were generated. Any owner's bonus or breeder's award that cannot be delivered to the rightful recipient within the time frames in chapter 63.29 RCW will be forwarded to the department of revenue as unclaimed property as required in chapter 63.29 RCW.

Nonprofit race meets, as defined in RCW 67.16.105(1) and 67.16.130(1) are exempt from the requirements to collect and distribute owner's bonus and breeder's awards as outlined in this chapter.