- California cardrooms are fighting back in court after new rules moved to shut down their most popular blackjack games.
- If the regulations stick, thousands of workers and several city budgets could take a serious financial hit.
- A judge will now weigh in on whether the regulations get put on hold during the legal fight.
SACRAMENTO, Calif. – California cardrooms are heading to court after a wave of new state regulations put some of their biggest money-making table games on the chopping block.
On Monday, the California Gaming Association filed two cases in San Francisco Superior Court contesting Attorney General Rob Bonta's regulations that would essentially put an end to blackjack-style games at cardrooms throughout the state as of April 1.
Through a system involving licensed third-party companies known as proposition players, or TPPPs, the restrictions target the legal blackjack games that cardrooms have provided for decades. Since these companies serve as the banker during hands, cardrooms are able to provide a variation of blackjack without necessarily breaking California law.
Traditional banked games, in which players wager against the house, are only permitted in tribal casinos under state law. With permission from several attorneys general dating back to the early 2000s, TPPPs were the workaround that kept cardroom blackjack alive and legal for years.
What's Actually Changing
The new regulations would forbid cardrooms from using the terms "blackjack" or "21" in any game name and outlaw any blackjack-style game in which a player can score more than 21 points. Additionally, the dealer position would have to switch places with TPPP staff every 40 minutes, a change that industry officials claim renders the games practically unplayable for gamers.
If the regulations go into force, California blackjack sites and operators anticipate revenue losses of around $464 million per year, while state documents recognize that tribal casinos stand to gain about $232 million if players move elsewhere.
Beyond the cardrooms themselves, there are financial repercussions. Cardroom taxes are a major source of funding for police, fire departments, and other essential local services in cities like Commerce, Bell Gardens, and Gardena. According to Commerce, its cardroom revenue, which presently makes up more than 40% of the city's general fund, might be lost by more than 60%.
To make up for the anticipated shortfall, a new sales tax plan has already been put on the June ballot in Commerce, and other impacted cities are considering similar actions to get ready for the possible loss of revenue.
The California Gaming Association projects that over 10,000 jobs statewide could be eliminated, representing roughly half of all cardroom employment in California. Now, a court will decide if the measures should be blocked while the lawsuits are pending.