California is one of the states that has had cardrooms for most of its history. Since 1854, when the California Grand Casino opened in Pacheco, poker has been established in the state. It took off in 1984, when the General Assembly ordered the Attorney General to regulate the state’s cardrooms, and was further regulated in 1997 with the Gambling Control Act. In April, more regulations will be introduced for California cardrooms, which may result in reduced employment and fewer game options for players.
Small Changes Makes Big Difference
The California Office of Administrative Law put through two new regulations that will take effect on April 1. One of those new regulations specifically outlaws blackjack in almost any form. Cardrooms would no longer offer the traditional dealer/player setup, and it would eliminate standardizing deck values and blackjack play (hitting/standing/busting and a targeted number).
By eliminating this gaming variant, it is estimated that both revenues and employment opportunities would suffer in the cardrooms. Those businesses would lose up to $464 million in annual revenues. Job losses for the cardrooms would be in the neighborhood of 3,750 for the next ten years, a yearly drop of 375 cardroom jobs.
There is also another regulation that would affect the play of these table games. There would not be a single distinct “bank” in the game; the traditional “dealer” role would move around the table, much as it does in a poker game. It also would not allow for more than one “third-party proposition player” at the tables, meaning that only one cardroom provided player (a “prop player,” a tradition in California cardrooms) can be in action on the table at any given time.
Who Benefits?
These new regulations completely go against the cardroom industry in California, an industry that provides millions of dollars to local and state coffers. It comes as the state’s courts determined that the cardrooms were not infringing on the rights or games offered by the tribal casino system, which filed several lawsuits that were dismissed, alleging the cardrooms were cutting into their profits. The new regulations proposed by Attorney General Rob Bonta are an attempt by the state of California to set firmer guidelines for cardrooms, but not for tribal casinos.
Bonta has demonstrated he is not a friend to the California cardroom gaming system. He has issued rulings against daily fantasy sports, stating that it is illegal in the Golden State. Bonta has also shut down “sweepstakes” gaming operations because of their proximity to casino and slot activities.
Who has benefited from these actions? The tribal casino system in California, which is constitutionally protected in the state. The tribes are vehemently fighting against the ability of California’s cardrooms, horse tracks, and other live and online gaming venues to be easily accessible in other areas of the States of America. In fact, the two new regulations mentioned above are expected to increase tribal revenues by almost $250 million annually.
Bottom line, the tribal gaming association in California, the California Nations Indian Gaming Authority, has been supportive of Bonta’s actions. This is despite statements from local municipalities in areas such as Bell Gardens (home of The Bicycle Casino) and Commerce (home of The Commerce Casino) about the loss of tax revenue; these areas would see decreases of 40% to 70%. It is also estimated that half the jobs in the cardrooms would be eliminated, another loss of revenue for local businesses, governments, and the state.
These new rules are set to go into effect on April 1, but they will not take full effect until later in the year. There is also the potential that state courts will step in and place a legal hold onto the process. Gaming continues to be a convoluted mess in California, one in which combatants on all sides are looking for their piece of the pie.
