The California Legislature Will Be a Focal Point for Conflict Between Native American Tribes and Cardrooms.
California's state legislature is set to kick off again this Monday, and lawmakers are confronted with a long-standing disagreement.
The dispute between Native American casinos and California cardrooms is back before the state, with both sides boasting deep pockets and even deeper enmities.
A bill that would enable tribes to initiate civil actions against cardrooms is expected to surface, and if you think you've heard this story before, you're right.
Senate Bill 549 would grant tribes a three-month window in 2024 to initiate legal action against their adversaries. This potential action had previously been rejected by the public when it was proposed as Prop. 26 last year.
When SB 549 passed the Senate earlier this year as an educational initiative, the bill's architect, Senator Josh Newman (D-Fullerton), swapped language from Prop. 26, bringing the battle between tribes and poker parlors back to the forefront.
Casino-owning tribes allege that cardrooms, also known as poker parlors, have encroached on tribal territories with games like blackjack.
Prop. 26, had it not been rejected, would have given the state attorney general the power to take action against gambling law infractions. However, if the AG failed to act, tribal casinos could file a civil action as a private party. Cardroom operators claim this would have forced them out of business.
The economic influence of California's cardroom sector is estimated at over $6 billion and supports countless jobs, per the California Gaming Association trade association.
Huge sums of money are being poured into the battle, as tribes are a powerful lobby group with extensive political funds. They face off against what appears to be a smaller cardroom in a town called Hawaiian Gardens in Los Angeles County. That establishment has already invested more than $5 million to quash SB 549.
San Jose's Stance
Meanwhile, San Jose officials declare they will not give in and will fiercely resist Senate Bill 549. As per city officials, allowing tribes to sue cardrooms over games offered would snuff out cities' revenue from taxes and effectively outlaw the function of poker parlors.
It could "eliminate thousands of cardroom jobs and millions of dollars in municipal revenue in numerous California cities," wrote Sarah Zarate, the city's policy and government relations director, in a June letter.
The California Gaming Association affirms that San Jose's two cardrooms employ over 2,000 people.
Cardrooms cannot offer slot machines, while tribal casinos can. Cardrooms abide by gambling regulations by allowing players to bet against one another or a third party with no "house" money involved.
Tribes argue that enabling wagers on player-dealer card games helps cardrooms circumvent California's constitutionally protected monopoly on legal gambling. Tribes currently lack the standing to challenge the legality of cardrooms in court under existing law.
Sen. Newman insists his bill wouldn't prejudge the outcome of lawsuits, should they be permitted. It would merely prompt the courts "to resolve the longstanding dispute over whether certain controlled games operated by California card clubs are illegal banking card games and whether they infringe upon tribal gaming rights."
California's Governor Under Scrutiny
In May, California Governor Gavin Newsom (D) sanctioned legislation that enforced a 20-year moratorium on the state granting new cardroom licenses. The bill essentially revitalized a moratorium that was initially enforced by the Gambling Control Act of 1997.
The GCA forbade the founding of new cardrooms and the expansion of existing ones, and had expired on January 1 of this year.
Gov. Newsom is also under the spotlight and at the center of a debate over whether he is seeking a presidential bid. He has yet to announce a presidential campaign.
Furthermore, Newsom's acrimonious rivalry with Florida Governor Ron DeSantis (R) is likely to be highlighted during a potential debate between the two governors. DeSantis is on the Republican ticket for president.
The Newsom vs. DeSantis debate is tentatively scheduled for November, hosted by Fox News' Sean Hannity. The two sides are at odds over the inclusion of a studio audience and are currently locked in a standoff over the specifics of the event.
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Source: www.casino.org
