California regulators have finalized rules that will prohibit cardrooms from offering blackjack-style games beginning April 1, setting off alarms in Los Angeles County communities that depend heavily on gambling revenue. While state officials describe the move as enforcement of long-standing constitutional limits, city leaders and industry representatives warn of sweeping financial consequences.

The California Department of Justice (DOJ) issued its Final Statement of Reasons earlier this month, confirming that the regulations implement Penal Code §330, which bars “any game of twenty-one.” Officials rejected claims that cardroom variations differ in substance from traditional blackjack. Cardrooms must submit compliance plans by May 31.

The change follows approval by California’s Office of Administrative Law and comes after the DOJ introduced the proposal in spring 2025, held two public hearings in May, and reviewed more than 1,700 public comments. “After careful review and consideration of the comments, DOJ did not make any substantive changes to the proposed regulations,” the department said in a statement cited by Gambling Insider.

Cities Dependent on Casino Revenue Brace for Losses

Across California, more than 70 cardrooms employ about 20,000 workers. Industry estimates cited in public filings suggest the state could lose upwards of $500 million in annual tax revenue if the ban sharply reduces operations. A 2019 analysis commissioned by the California Gaming Association placed total annual tax contributions from cardrooms at roughly $500 million, including $398.8 million in state taxes and $100.9 million in local gaming taxes.

In Los Angeles County, concerns are particularly acute. Supervisor Hilda Solis said cardrooms generate over $2 billion in economic activity locally and support more than 9,000 jobs.

The small city of Hawaiian Gardens illustrates the scale of potential disruption. With about 14,000 residents and less than one square mile of land, the municipality relies on The Gardens Casino for a significant share of its budget. The casino employs approximately 1,300 people and contributes about $13 million annually in tax revenue.

Councilmember Victor Farfan said nearly two-thirds of the city’s $20 million general fund comes from the cardroom. He warned that a “sudden and significant reduction” in casino activity would threaten essential services, including policing and public safety. Farfan described the issue as “not an abstract policy debate; it’s a matter of economic survival” for the city.

Farfan also said efforts to engage state officials fell short. The city submitted objections and sought meetings with regulators, but those attempts “were met with silence,” leaving Hawaiian Gardens “without meaningful dialogue, transparency, or collaboration.”

Officials have discussed contingency measures, including the possibility of Chapter 9 municipal bankruptcy if revenues decline sharply. Only a few California cities have taken that step in recent decades, often facing extended restructuring and service reductions.

Other municipalities face similar exposure. Cardroom taxes account for about half of Bell Gardens’ general fund and roughly 40% of Commerce’s. Commenters in the rulemaking record cautioned that steep revenue losses could lead to closures, bankruptcy, or even disincorporation in some cities. The DOJ acknowledged these warnings but concluded they did not justify altering the regulations.

Industry and Tribal Groups Clash Over Enforcement

Cardroom operators argue the rules threaten their viability. California Gaming Association President Kyle Kirkland wrote to Attorney General Rob Bonta that “The proposed regulations destroy the financial viability of the California cardroom industry, jeopardize thousands of working families and harm dozens of California communities.”

At Gardens Casino, attorney Keith Sharp said eliminating blackjack would remove a “double-digit portion” of the business. He estimated the venue might have to lay off as many as 300 workers out of its 1,300 employees if customers shift elsewhere. Of the casino’s roughly 60 tables, about a dozen host blackjack games.

Labor unions have also voiced opposition, warning that closures could ripple outward into municipal finances. Nonprofits that receive casino-linked funding predict reductions in scholarships, youth programs, and social services. One association noted that Seven Mile Casino contributes more than $35,000 annually in law student scholarships.

Supporters of the rules frame the action as overdue enforcement. Gaming law lecturer Rick Trachok of UC Berkeley described cardrooms’ use of rotating “player-dealers” and third-party bankers as a “transparent attempt to get around the Constitution.”

In 2000, voters approved Proposition 1A, granting tribes exclusive rights to operate Nevada-style, banked casino games on tribal land. More than 60 tribal casinos continue to offer blackjack. The DOJ has cited case law, including Oliver v. County of Los Angeles, in support of tightening the rules around player-dealer rotations.

Tribal leaders welcomed the move. James Siva, chair of the California Nations Indian Gaming Association, called the regulations an “important step in combating unscrupulous and illegal gaming in California.” Victor Rocha added, “Justice delayed can sometimes still be justice too.”

The DOJ acknowledged that cardrooms “pay fair wages … and contribute to the local tax base like other businesses in their community,” but maintained that economic contributions do not supersede statutory prohibitions. Regulators determined no reasonable alternative would achieve the same enforcement goals while respecting constitutional limits.

As the April deadline approaches, municipalities and businesses face mounting uncertainty. Some analysts predict that tribal casinos could gain an estimated $232 million annually as players migrate, while others may travel to Nevada or Arizona to continue playing blackjack. For cities that depend on cardroom taxes, the coming months will test their fiscal resilience as the state reshapes its gaming landscape.