California cities brace for massive budget shortfalls due to new cardroom regulations

Elected leaders from Bell Gardens, Compton, Commerce, and Hawaiian Gardens, along with union leaders from AFSCME District Council 36 and AFSCME Local 773, held a press conference in Commerce, Calif. on Tuesday to speak out against two cardroom regulations passed by the California Department of Justice in February. 

These cities, and many more across California, are bracing for a massive blow to their budgets, as the revenue they receive from cardrooms within their cities will diminish. The state of California projects that cities will lose hundreds of millions of dollars in revenue. 

Revenue from cardrooms is largely used to fund essential public services such as infrastructure maintenance and upgrades, youth and senior programs, public safety, and much more. Additionally, the state projects that thousands of cardroom and city employees will be laid off.

The executive director of AFSCME District Council 36, which represents 28,000 city and county employees across southern California, has been sounding the alarm on how devastating these regulations will be for working families. 

“These regulations will devastate cities like Commerce, Bell Gardens, and Hawaiian Gardens and residents are rightfully concerned about the future of the communities they love,” said Matthew Maldonado. “City workers may lose their jobs, which means, in an already difficult economy where families cannot afford to pay rent, buy groceries, put gas in their car, and pay for childcare, they will struggle even more. And now the burden of reducing cities’ budget deficits caused by these regulations will be placed on the backs of working people. It’s not right!”

The president of AFSCME Local 773, which represents City of Commerce employees, sent a clear message to the state legislature during Tuesday’s press conference, “fund the cities, protect the workers, do not leave us to absorb a crisis the state created,” said Kevin Larsen. “The math is brutally simple. If Commerce loses up to $18 million and Bell Gardens loses up to $7 million, those losses do not stay on a spreadsheet. They show up as layoffs.”

In an attempt to prevent the consequences of the cardroom regulations, the California Gaming Association has filed lawsuits to block the regulations from being implemented. Regulations went into effect on April 1; however, cardrooms have until at least the fall to implement changes. Hopefully, a ruling on the lawsuits will happen before May 31, when cardrooms must submit compliance plans.

AFSCME District Council 36 members affected by these regulations are continuing to get organized, fight back, and use their union power to ensure that their families, friends, and neighbors continue to have access to resources and city services.