California card rooms entered a new era of uncertainty this Wednesday. Two new regulatory provisions involving blackjack-style games and player-dealers, after years of legal and regulatory tug-of-war, officially took effect. The card rooms claim these rule changes will destroy their business and community, while the state government's economic analysis also acknowledges the potential for significant impact. However, the California tribes, who obtained exclusive rights to casino games in 2000, argue that the new rules maintain their exclusive position by targeting illegal gambling. To be honest, this twenty-plus-year tug-of-war has finally reached a phase of resolution—but it could be a disaster for the cities where card rooms are located.
New Rule Core: Blackjack is no longer "21 points", player-dealer rules are fully tightened
The new rules make drastic changes to blackjack-style games, almost completely altering traditional gameplay. Major changes include: no more "busting" mechanism (players or dealers exceeding 21 points no longer automatically lose); wins and losses "only determined by whether the player's hand points are closer to the target points than the player-dealer's hand points"; the target points cannot be 21; without a 21-point target, players or dealers getting 21 points do not automatically win; in the event of a tie, the player wins, rather than the usual draw; the terms "21" or "blackjack" must not appear in future games.
In terms of player-dealer (TPPP), the new rules require: the player-dealer must always sit at the table, and must offer this position to all players before each hand; this offer must be "visible to surveillance cameras"; each table must post a notice stating "any player can serve as player-dealer, and the one serving cannot win or lose more than their bet amount"; the player-dealer role must rotate to at least two other players besides TPPP every 40 minutes, otherwise the game ends; if TPPP serves as player-dealer, the next round must rotate to other players; TPPP can only accept and settle bets while serving as player-dealer; only one TPPP is allowed per table.
Tribal Victory: Ten years of lobbying finally pays off
James Siva, chairman of the California Indian Gaming Association, stated at the annual Indian Gaming Tradeshow in San Diego that this is a victory for the tribes. "We are excited about this decision, which the tribes have been advocating for the past 10 years." He insists that the games offered by card rooms are illegal banked card games, violating the tribes' exclusive rights and sovereignty. Regarding the potential collateral impacts of the new rules, Siva said the "intent was never to bring any negative harm to the cities of card rooms," but rather to "uphold the law."
Card Room Counterattack: Lawsuits filed, preliminary injunction sought
On March 9, the California Gaming Association announced two lawsuits filed in the San Francisco Superior Court, attempting to block these two sets of regulations. CGA claims these changes represent an "unprecedented power grab" by Attorney General Rob Bonta. On Tuesday, CGA announced it had applied for a preliminary injunction, hoping to prevent the new rules from taking effect during the lawsuit. The 406-page civil lawsuit lists Bonta, the California Department of Justice, the Gambling Control Commission, and its director as defendants. The complaint states that the defendants lack the authority to enforce blackjack regulations and to revoke games, and that the regulations conflict with the law, violating state and federal due process protections.
City Financial Emergency: Card room taxes account for over 40% of the general fund, two cities have declared financial emergencies
For several cities in California, card room income is one of the most important sources of municipal service tax revenue. In the cities of Commerce and Bell Gardens, card room income accounts for more than 40% of their general funds. Both cities have declared financial emergencies and will propose a 0.25 cent sales tax measure in the June vote to compensate for the tax loss. Card rooms must submit a new compliance plan by June 1, with a hard deadline of July 1 if not submitted.
The Justice Department's analysis last year estimated that the new rules could halve blackjack revenue, "25% of customers might switch from card rooms to tribal casinos to play traditional blackjack." In 2023, existing blackjack games in California card rooms generated about $136 million in revenue. The Justice Department estimates card rooms will lose $68 million in revenue, while tribal casinos will gain $34 million. CGA President Kyle Kirkland stated that the Attorney General's office "casually assumes that a 50% revenue loss for card rooms is no big deal, but it's not a small matter for the card rooms, 20,000 employees, and the cities and communities that rely on us."
Bonta in Focus: Campaign donations spark controversy, accused of being influenced by tribal interests
Bonta is at the center of controversy. He will run for re-election in November this year, and his 2026 campaign has already raised $7.5 million in donations, higher than the $7.1 million in 2022. Kirkland points out that hundreds of thousands of dollars in Bonta's campaign donations come from tribes, "I think this is just to satisfy the political show of special interest groups." However, Bonta has also received thousands of dollars from card room donors over the years. In the 2021 cycle, he received at least $118,000 from card rooms, but this has dropped to less than $35,000 in the current cycle. The six most influential tribes' donations to Bonta dropped from over $70,000 in 2021 to about $45,000 this cycle.
In addition to the new card room regulations, Bonta also directed the seizure of 26 "on-demand horse racing" machines at Santa Anita Park in January, and issued a non-binding legal opinion in July last year, declaring nearly all forms of daily fantasy sports illegal in California. A comprehensive war over the gambling landscape is far from over. For more updates on U.S. gambling regulation, continue to follow PASA official website.
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