California pushes new regulations on card rooms offering banked games

The California Department of Justice is advancing regulations that would prohibit card rooms from offering modified versions of blackjack and other banked card games, aiming to close a long-debated loophole that allows “player-banker” systems.

The proposed rules could end decades of friction between tribal casinos and card rooms over how state gaming laws are interpreted and enforced.

Under current practice, card rooms in California are barred from offering games in which players compete directly against the house. However, a system using “player-bankers” provided by Third-Party Providers of Proposition Player Services (TPPPPS) has allowed establishments to host modified versions of blackjack and baccarat.

The DOJ has stated that these modified versions differ from traditional house-banked games only in name, suggesting that the structure still functions as a direct competition between player and dealer.

An economic analysis commissioned by the state projects significant financial consequences if the regulations are enacted. The Standardized Regulatory Impact Assessment (SRIA) prepared by Berkeley Economic Advising and Research estimated potential losses of $464 million for card rooms statewide, while tribal casinos could see revenue gains of $232 million.

The SRIA also forecasted that card rooms would lose 364 full-time jobs annually over the next 10 years. These figures have raised concerns among local business leaders and municipal governments that depend on gaming-related tax revenue.

Club One Casino, which relocated to Granite Park in 2021 following the pandemic shutdown, employs 250 workers and contributes roughly $1 million annually to Fresno’s general fund. The casino offers poker and modified blackjack games such as Spanish 21.5 and Pure 21.5. A similar gaming setup operates at The 500 Club Casino, situated on the Clovis-Fresno border.

“It’s a competitive overreach by the tribal owners,” said Kyle Kirkland, president of the California Gaming Association and owner of Club One Casino in Fresno, in a Fresno Bee report. “They don’t like the fact that card rooms are competing with them. So they’re pressuring the attorney general.”

Kirkland said table games represent roughly 50% of Club One’s revenue. “If we can’t offer the table games, that’s 50% of our revenue. If you take 50% out of your home budget, you’re going to feel it and probably have to move,” he said. “So this proposal, it would be fatal for card rooms. That’s not good for our employees or people.”

Critics have also warned that the proposed rules would “significantly cripple municipalities that heavily rely on the tax revenue for community programs such as public safety projects and senior programs,” according to Casino Beats.

Card room employees and supporters held a protest outside Attorney General Rob Bonta’s Fresno office on Thursday, saying the regulations could result in hundreds of job losses.

Kirkland noted that card rooms contribute to city funds and support nonprofit organizations. “Eliminating these card games from card rooms would have a big impact on the people of Fresno and Clovis, and especially other communities that are highly dependent on card rooms,” he said. “There seems to be a concerted effort to eliminate tax-paying card rooms when most people might not realize how much we contribute to the community.”

The proposal follows a Sacramento Superior Court ruling that dismissed a lawsuit brought by several tribal casinos against card rooms. The tribes argued that the card rooms’ modified blackjack and baccarat games violated state gaming law.

The suit was filed under Senate Bill 549, a 2024 measure that authorized tribes to pursue legal action against card rooms over alleged violations. Tribal operators are expected to appeal the decision.

With the lawsuit dismissed, the DOJ now faces pressure to act through regulation. A state-commissioned impact report estimates that restricting card room operations could reduce patronage by about 50% and cause additional losses in municipal tax revenue.

“Right now we have a fair balance,” said Capitol Casino worker Chris Linger. “Tribal casinos have slot machines and full-scale gaming, while card rooms offer table games that help sustain local economies.”