California cardrooms anticipate thousands of layoffs as gambling rules change

California’s $5.6 billion cardroom industry may be holding a losing hand.

A few days before Christmas, California Attorney General Rob Bonta 
proposed new rules that would drastically alter how casinos run 
blackjack, baccarat, pai gow and other card games.

The changes are so disruptive that the cardroom industry says it will be 
forced to close down all blackjack-style games in California, pull back 
on card game tables generally, and target layoffs of nearly 13,000 to 
its statewide workforce.

Poker is the only card game immune to Bonta’s rule changes — leading 
some cardroom operators to rethink their business models going forward.

Local governments where the cardrooms operate are so rattled by possible 
losses of tax revenue generated by the casinos in their communities that 
they met for an emergency video conference call Wednesday, Feb. 11, to 
discuss the economic impacts. Elected officials, administrators and 
finance staff from Hawaiian Gardens, Bell Gardens, Commerce, Compton, 
Gardena and elsewhere were listening in.

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 — 
which together make up a bulk of the multi-billion-dollar industry in 
California.

“I’m at a loss for words,” said Victor Farfan, councilmember with 
Hawaiian Gardens. “This 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.”

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.

Less than a block from the casino along Pioneer Boulevard, city staff in 
Hawaiian Gardens have held ongoing discussions about cuts in services — 
including fire and police — if the final year of its two-year budget 
cycle starting July 1 doesn’t realize the revenue stream it once 
anticipated.

If more than half of the city’s budget is wiped out — which is likely if 
Bonta’s regulation goes into effect  — 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.

“This is the harsh reality,” Farfan said.

City budget shortfalls
The scramble to plug possible budget holes in local governments is 
coming nearly a week after Bonta finalized a complex set of gambling 
rules that he says are needed to force cardroom casinos into compliance 
with California laws.

At the moment, California has two different kinds of gaming systems that 
operate side-by-side — one for tribal casinos and the other for cardrooms.

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.

A banked card game 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.

Cardrooms — like the Gardens Casino — are state-licensed venues that, 
under state law, may only offer player-banked or peer-to-peer games — or 
tables where players play against each other, not the house.

Bonta is now saying California laws on banked games must adhere to the 
federal Indian Gaming Regulatory Act of 1988 and California Proposition 
1A passed in 2000, according to the California National Indian Gaming 
Association. However, the cardroom industry disputes the tribal gaming 
industry’s legal interpretation of these laws, saying that Bonta’s rules 
could disrupt its business model.

Pai gow was the first card game using a player-dealer position in the 
cardroom industry in 1983.

Outsourced player-dealer services— or third party proposition players as 
they are known in casino parlance — 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.

Bonta’s new rules would upend the card games.

The cardroom rules, which were submitted by Bonta and the Bureau of 
Gambling Control and approved by the state’s Administrative Law Office 
in early February, go into effect April 1. The rules give cardrooms 
until May 31 to report how they’ll modify their card games — but the 
industry says it can’t comply with the rule because of their “vagueness” 
and belief that they don’t line up with their interpretation of what are 
permissible card games.

The rules also end their ability to have blackjack-style tables —  a big 
money draw for cardrooms.

So, is the sky falling?

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.

Layoffs coming?
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.

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  Wednesday.

“We’ve been playing blackjack forever, and now he’s (Bonta) decided we 
can’t,” said Sharp, who alleges Bonta is influenced by lobbyists from 
the tribal casinos in California. “A 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.”

For decades, California tribes have spent hundreds of millions of dollar 
in a long string of casino-related ballot initiatives over the years, 
including:

Prop 5. 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, “jeopardizing Indian gaming tribal 
self-sufficiency.”
Prop 1A.  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.
Prop 26. In 2022, the tribes pushed this measure — which failed — that 
would have legalized in-person sports betting on tribal lands and 
permitted craps and roulette.
Prop 27. Also in 2022, concurrent with the tribal-backed Prop. 26, 
California’s tribes lobbied heavily against an initaitive from 
DraftKings and FanDuel that would have legalized online sports bettting. 
This measure also failed.
Prop 68. In November 2004, Californians rejected a ballot measure that 
would have authorized slot machines in 16 California cardrooms and 
racetracks.
Prop 70. In November 2004, voters rejected a measure that would have 
allowed tribes unlimited expansion of casinos on their reservations.
Props 94, 95, 96, and 97.  In February 2008, all four propositions were 
approved, expanding the scope of tribal gambling enterprises in California.
Change rattles dealers
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.

“This will affect my life a great deal [if layoffs happen] because I’m a 
single mom,” said Chin, who earns a six-figure salary with tips. “This 
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?”

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. “I came from a very poor family, where we barely had food 
on the table. I don’t want to go back to that,” said Chin, who says 
she’s been getting panic attacks worrying about the layoffs.

Diane Nguyen, a 49-year-old customer service representative at Hawaiian 
Gardens, joined the cardroom in 2001.

“I heard they want to take away our blackjack tables. That’s going to 
hurt a lot of us,” Nguyen said. “Hopefully, this doesn’t happen.”

She financially supports her mom, father and child, the latter of whom 
attends online classes at Mt. San Antonio College in Walnut. “If I lose 
this job, I don’t know what I’d do,” said Nguyen who has a mortgage to 
pay in La Puente. “I’m always stressed.”

The layoffs may still come despite best efforts by the cardroom industry 
to save them.

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.

“If 60% of my business goes away, or is disrupted, we seriously have to 
think about what the reboot is for our business,” said Kirkland, whose 
group represents 72 cardrooms. “What Bonta is doing is pandering to the 
tribes.”

Illegal gaming?
James Siva, chairman of the California Nations Indian Gaming 
Association, has a different take.

He said that Bonta’s regulations are an important step in combating 
“unscrupulous and illegal gaming in California.”

“The 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,” 
said Siva in a statement. “We 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.”

In a statement issued Feb. 9, Bonta said that he followed all the proper 
requirements to submit the regulations for public comment and gather 
input. His office refused to answer additional questions submitted by 
the Southern California News Group.

The proposed regulations were first introduced in the spring of 2025.

“Prior to their introduction, DOJ held numerous meetings with 
stakeholders to discuss potential regulation of games,” said Bonta, 
pointing out that the regulations were ultimately sent to the Office of 
Administrative Law for review on Dec. 23, 2025, with their approval 
coming Feb. 6.

Players at cardrooms are surprised by the changes.

“It’s absolutely ludicrous,” said Jack Gardner, a Norco plumber who lost 
$130 playing in a poker tournament on Wednesday at the Gardens Casino. 
“The poker side could be impacted as well if they make cuts on blackjack 
and other card games. This is the closest one to my house. There’s a lot 
of people who work in these casinos, and now they could be without jobs. 
That’s terrible. It’s another sign of why business is leaving California.”

John Doan, an entertainment consultant from Garden Grove, drives to the 
Gardens Casino twice a week to play blackjack. “If they change the 
fundamentals, the game disappears,” said Doan, who won $340 on 
Wednesday. “I’m a blackjack player. Once you change the fundamentals of 
the game, it’s not football any more, it’s soccer.”

https://www.ocregister.com/2026/02/15/california-cardrooms-anticipate-thousands-of-layoffs-as-gambling-rules-change/