Those Los Angeles-area communities all have major cardroom casinos, including the Commerce Casino & Hotel, Crystal Casino, the Gardens Casino, Hustler Casino, Lucky Lady Casino and Parkwest Bicycle Casino \u2014 which together make up a bulk of the multi-billion-dollar industry in California.<\/p>\n
\u201cI\u2019m at a loss for words,\u201d said Victor Farfan, councilmember with Hawaiian Gardens<\/a>. \u201cThis decision will be devastating. It shakes at the very foundation of our city. We will not be able to provide essential services for our community.\u201d<\/p>\n Hawaiian Gardens, a tiny, 612-acre city of 14,150 people and the smallest in Los Angeles County, collects about 60% of its general fund revenue of $20 million on taxes paid by the Gardens Casino cardroom along East Carson Street, according to Farfan.<\/p>\n Less than a block from the casino along Pioneer Boulevard, city staff in Hawaiian Gardens have held ongoing discussions about cuts in services \u2014 including fire and police \u2014 if the final year of its two-year budget cycle starting July 1 doesn\u2019t realize the revenue stream it once anticipated.<\/p>\n If more than half of the city\u2019s budget is wiped out \u2014 which is likely if Bonta\u2019s regulation goes into effect\u00a0 \u2014 Hawaiian Gardens may be forced to restructure its debt under a Chapter 9 bankruptcy protection filing, according to Farfan. Unlike other bankruptcies, Chapter 9 protects taxing entities from creditor lawsuits while it develops a plan to adjust debt obligations. During such a process, Farfan worries the city of Hawaiian Gardens could lose its independence and be absorbed by Los Angeles County or taken over by the state.<\/p>\n \u201cThis is the harsh reality,\u201d Farfan said.<\/p>\n City budget shortfalls<\/p>\n The scramble to plug possible budget holes in local governments is coming nearly a week<\/a> after Bonta finalized a complex set of gambling rules<\/a> that he says are needed to force cardroom casinos into compliance with California laws.<\/p>\n At the moment, California has two different kinds of gaming systems that operate side-by-side \u2014 one for tribal casinos and the other for cardrooms.<\/p>\n Tribal casinos operate under federal law and offer casino-style gaming on tribal land, granted by Proposition 1A. That proposition amended the state constitution to allow federally recognized Indian tribes to operate slot machines, lottery games, and banked card games.<\/p>\n A banked card game<\/a> is a type of gambling game in which players place bets against a central dealer, known as the banker or house, rather than directly against each other.<\/p>\n Cardrooms \u2014 like the Gardens Casino \u2014 are state-licensed venues that, under state law, may only offer player-banked or peer-to-peer games \u2014 or tables where players play against each other, not the house.<\/p>\n Bonta is now saying California laws on banked games must adhere to the federal Indian Gaming Regulatory Act of 1988 and California Proposition 1A<\/a>\u00a0passed in 2000, according to the California National Indian Gaming Association. However, the cardroom industry disputes the tribal gaming industry\u2019s legal interpretation of these laws, saying that Bonta\u2019s rules could disrupt its business model.<\/p>\n Pai gow was the first card game using a player-dealer position in the cardroom industry in 1983.<\/p>\n Outsourced player-dealer services\u2014 or third party proposition players as they are known in casino parlance \u2014 came in 1990. An outsourced player-dealer service is a licensed independent company, not the casino itself, whose employees play in cardroom table games to ensure they remain active and filled, acting as a neutral party like any other player in the game.<\/p>\n Bonta\u2019s new rules would upend the card games.<\/p>\n The cardroom rules, which were submitted by Bonta and the Bureau of Gambling Control and approved by the state\u2019s Administrative Law Office in early February,\u00a0go into effect April 1. The rules give cardrooms until May 31 to report how they\u2019ll modify their card games \u2014 but the industry says it can\u2019t comply with the rule because of their\u00a0\u201cvagueness\u201d<\/a>\u00a0and belief that they don\u2019t line up with their interpretation of what are permissible card games.<\/p>\n The rules also\u00a0end their ability to have blackjack-style tables<\/a>\u00a0\u2014\u00a0 a big money draw for cardrooms.<\/p>\n So, is the sky falling?<\/p>\n The California Gaming Association, which represents the interests of cardrooms, is preparing to file a lawsuit against the state in the coming weeks, citing the new rules as a break from longstanding precedent that allowed such table games at cardrooms since before passage of Prop. 1A, according to cardroom advocates interviewed.<\/p>\n Layoffs coming?<\/p>\n Keith Sharp, general counsel at The Gardens Casino, said he is bracing for layoffs approaching nearly half of his workforce of 1,300 people who work as dealers, customer service representatives, food workers, and others.<\/p>\n The new rules would effectively end at least 11 of the blackjack-styled tables and threaten the remaining 70 or so tables of baccarat, pai gow and other card games, said Sharp on\u00a0 Wednesday.<\/p>\n \u201cWe\u2019ve been playing blackjack forever, and now he\u2019s (Bonta) decided we can\u2019t,\u201d said Sharp, who alleges Bonta is influenced by lobbyists from the tribal casinos in California. \u201cA handful of people, wealthy tribes, want to control all gambling in California. They want to monopolize the industry. As a result, we will lay off hundreds of people here.\u201d<\/p>\n For decades, California tribes have spent hundreds of millions of dollar in a long string of casino-related ballot initiatives over the years, including:<\/p>\n Prop 5.<\/a> In 1998, Californians passed a measure that would have enacted tribal-state compacts to set up gambling on tribal lands. A union, the Hotel Employees and Restaurant Employees, brought a suit against the validity of Prop 5. Most of the measure was struck down by the California Supreme Court, \u201cjeopardizing Indian gaming tribal self-sufficiency<\/a>.\u201d Change rattles dealers<\/p>\n Nary Chin, a 55-year-old cardroom dealer at Hawaiian Gardens, put her four children through local universities and colleges since joining the casino in 1999.<\/p>\n \u201cThis will affect my life a great deal [if layoffs happen] because I\u2019m a single mom,\u201d said Chin, who earns a six-figure salary with tips. \u201cThis is like family here. I learned how to speak English at the tables. Why do we need to change when everything is going so well already?\u201d<\/p>\n Chin has memories of growing up poor with her family in San Bernardino when they first immigrated to the U.S. from Cambodia, and later moving to Long Beach. \u201cI came from a very poor family, where we barely had food on the table. I don\u2019t want to go back to that,\u201d said Chin, who says she\u2019s been getting panic attacks worrying about the layoffs.<\/p>\n Diane Nguyen, a 49-year-old customer service representative at Hawaiian Gardens, joined the cardroom in 2001.<\/p>\n \u201cI heard they want to take away our blackjack tables. That\u2019s going to hurt a lot of us,\u201d Nguyen said. \u201cHopefully, this doesn\u2019t happen.\u201d<\/p>\n She financially supports her mom, father and child, the latter of whom attends online classes at Mt. San Antonio College in Walnut. \u201cIf I lose this job, I don\u2019t know what I\u2019d do,\u201d said Nguyen who has a mortgage to pay in La Puente. \u201cI\u2019m always stressed.\u201d<\/p>\n The layoffs may still come despite best efforts by the cardroom industry to save them.<\/p>\n Kyle Kirkland, president and general manager of Club One Casino in Fresno, and president of the California Gaming Association, forecasts layoffs statewide approaching 13,000 in an industry with 20,000 directly employed by cardroom casinos and another 10,000 who are vendors.<\/p>\n \u201cIf 60% of my business goes away, or is disrupted, we seriously have to think about what the reboot is for our business,\u201d said Kirkland, whose group represents 72 cardrooms. \u201cWhat Bonta is doing is pandering to the tribes.\u201d<\/p>\n Illegal gaming?<\/p>\n James Siva, chairman of the California Nations Indian Gaming Association<\/a>, has a different take.<\/p>\n He said that Bonta\u2019s regulations are an important step in combating \u201cunscrupulous and illegal gaming in California.\u201d<\/p>\n \u201cThe regulations further clarify that games and practices employed by commercial card rooms are indeed prohibited under California law. Running a business contrary to that law is an illicit business, period,\u201d said Siva in a statement. \u201cWe hope that the [state] Department of Justice will now enforce these regulations so California can ensure a well-regulated gaming industry that is safe for consumers.\u201d<\/p>\n
\nProp 1A<\/a>.\u00a0 A constitutional amendment that fundamentally shifted the landscape of gaming in California, allowing tribal governments to operate gambling in California on reservation lands, passed in 2000.
\nProp 26<\/a>. In 2022, the tribes pushed this measure \u2014 which failed \u2014 that would have legalized in-person sports betting on tribal lands and permitted craps and roulette.
\nProp 27<\/a>. Also in 2022, concurrent with the tribal-backed Prop. 26, California\u2019s tribes lobbied heavily against an initaitive from DraftKings and FanDuel that would have legalized online sports bettting. This measure also failed.
\nProp 68<\/a>. In November 2004, Californians rejected a ballot measure that would have authorized slot machines in 16 California cardrooms and racetracks.
\nProp 70<\/a>. In November 2004, voters rejected a measure that would have allowed tribes unlimited expansion of casinos on their reservations.
\nProps 94<\/a>, 95<\/a>, 96<\/a>, and 97<\/a>.\u00a0 In February 2008, all four propositions were approved, expanding the scope of tribal gambling enterprises<\/a> in California.<\/p>\n
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