The battle between California’s tribal casinos and cardrooms continues to rage. Proposition 26, backed by Native American tribes, failed at the ballot box last year. This proposition sought to give tribes control over sports betting and expand gambling at tribal casinos, including roulette and dice games. Another key provision in Proposition 26 aimed to resolve a long-running legal dispute with cardrooms over the types of games they can offer. Tribal casino owners contend that their rivals, with games like blackjack, have encroached on their territory under the state’s complex definition of legal and illegal gambling.
Proposition 26 proposed giving the attorney general new powers to address gambling law violations, including the ability to shut down establishments deemed to be in violation. If the attorney general declined to act, a private party – such as a tribal casino – could file a civil lawsuit on their own. Cardroom operators saw passage of the proposition as a death sentence and were relieved when it failed.
However, the war over gambling turf isn’t over. State Sen. Josh Newman has proposed Senate Bill 549, allowing tribes to do what voters didn’t approve last year: sue rival cardrooms. The bill copies language almost verbatim from Proposition 26, giving tribes a three-month window next year to take legal action.
Both sides are gearing up for a fight as the Legislature reconvenes. Tribes have deep political and financial resources and have long been a major interest group in the Capitol. However, the family that owns a major cardroom in Hawaiian Gardens, a small city in Los Angeles County, has pledged more than $5 million this year to lobby against SB 549.
Hawaiian Gardens sits near the edge of Sen. Newman’s district, and taxes from the Gardens Casino, one of the state’s largest cardrooms, provide more than two-thirds of the revenue for the impoverished city. This isn’t the first time this casino has been embroiled in a political fight.
The casino’s late founder, Dr. Irving Moskowitz, was a major financial backer of settlements in territory claimed by both Israelis and Palestinians. Moskowitz’s actions in Israel were cheered by the nation’s hard-liners but decried by moderates. That conflict spilled over into the Legislature with accusations that the city of Hawaiian Gardens misused redevelopment funds to underwrite construction of the casino. Moskowitz died in 2016, but three years later, the casino run by his son paid $3.15 million to settle allegations from the California attorney general’s office that it concealed a $2.8 million federal fine for violating anti-money laundering laws when applying for a new state license.
The casino was allowed to continue operating, but its owners now see SB 549 as a threat to their existence and that of other cardroom owners. The battle between tribal casinos and cardrooms promises to continue to be a contentious one.
