City leaders propose sales tax hike after new state regulation against card room games
The rule targets blackjack-style and player-dealer games, possibly eliminating some of the most popular games inside card rooms.
CITY OF COMMERCE, Calif. (KABC) -- The cities of Commerce and Bell Gardens are declaring a fiscal emergency and want voters to approve a sales tax hike, and it's all because of new rules governing card rooms.
Thursday's emergency meeting comes as new state regulations approved last month by California's Department of Justice under Attorney General Rob Bonta could dramatically change how card rooms operate across the state.
The rule, set to take effect April 1, targets blackjack-style and player-dealer games, possibly eliminating some of the most popular games inside card rooms.
"The attorney general's own fiscal analysis says it projects up to 50% loss of jobs and revenue for the card room industry. That's millions of dollars and thousands of jobs for the state of California," Commerce City Manager Ernie Hernandez said.
The regulations were first proposed last year. Supporters, including the California Nations Indian Gaming Association, call the changes a necessary step to crack down on what they consider illegal gaming, but city leaders say the impact will hit far beyond casinos.
"Our state's attorney general, Rob Bonta, has unilaterally made a decision to implement regulations on our card rooms that will really negate a lof of the revenue that we have coming in that funds our infrastructure projects, our fire, our law enforcement, our public safety services and our youth and our senior programs," Mayor of Commerce, Kevin Lainez, said.
For cities like Commerce and Bell Gardens, card rooms are a major revenue boost, funding essential public services. Losing that revenue could mean cuts to everything from police services to community programs.
"They generate over $17 million in card room taxes annually for our city, which is more than 40% of our entire general fund. That revenue supports the services that our residents depend on every single day. This is police, parks and recreation, senior and youth programs, crossing guards and our community family services," Bell Gardens City Manager, Michael O'Kelly, said.
In response, both Commerce and Bell Gardens are placing a measure on the June ballot that would raise sales taxes to increase revenue for the cities.
