Club Supporters Vow to Pursue Vote on Gambling : West Hollywood: Group considers petition drive after council rejects referendum on legalized card games.

Supporters of a referendum for a legalized gambling club in West Hollywood insist the proposal is “absolutely not dead,” despite the City Council’s refusal to approve a request for the ballot measure.

The council, caught in the cross fire of opposition from residents and a well-organized campaign by proponents, voted unanimously Monday night to reject a request for a referendum that would have allowed gambling on all legal card games at Cavendish West Hollywood, a private bridge and rummy club at 9255 W. Sunset Blvd.

But Cavendish general partner Philip Marks said Tuesday that the proposal is “absolutely not dead.” He said Cavendish proponents may seek to have the issue placed on the 1990 ballot by petition or may submit a new plan to build the club on the city’s shabby east end.

Cavendish officials say the city would have received more than $6 million a year in fees from the business. They spent months lobbying the City Council and local AIDS and seniors groups, which could have received some of that money.

Council members appeared unprepared for the vociferous opposition and pleas for support of the plan.

“There are certain issues in politics that are moral issues, and it is difficult to have a rational debate,” Councilman Steve Schulte said after the hearing.

“What politician wants to get in front of all that?” Schulte said, referring to the several hours of heated testimony.

Cavendish officials seemed surprised at the council’s unanimous rejection of the referendum in the wake of the months-long lobbying effort. Lobbyist Bruce Decker said the group had been up front with council members during individual meetings, and that they were cautiously optimistic before the hearing.

“We think it was unnecessarily hasty. We have demonstrated a willingness to work with residents and with the city in revising the proposal so that it would be more acceptable,” Decker said.

Plans presented to the council focused on converting the dowdy bridge and rummy club into an upscale Las Vegas-style casino. But Cavendish officials Monday night took a different approach, suggesting that all aspects of the plan would be flexible, including location and hours of operation, provided voters approved an ordinance to allow gambling in the club.

Virtually all of the opposition to the Sunset Strip club came from residents of the nearby Sierra Towers apartment complex in West Hollywood, who had been bused in on what some were calling an “anti-gambler’s special.” There were also impassioned pleas from residents of nearby Beverly Hills.

Though much of the testimony targeted the more mundane issues of parking and traffic problems that could result from a nightly influx of a possible 500 out-of-town gamblers that the club could accommodate, many questioned the “moral turpitude” that gambling would bring to West Hollywood.

“In their proposal, they quote a psychiatrist who says gambling is a part of every known society. Well, so is prostitution and so is murder,” said Barbara Lazaroff, part owner of Spago, an upscale restaurant in West Hollywood, who spoke at the hearing.

Card clubs in several Los Angeles-area cities, including Bell and Commerce, have been beset with crime and corruption problems since opening in the early 1980s. Such cities turned to legalized gambling to shore up treasuries depleted by tax-cutting Proposition 13 in 1978.

As more clubs were approved, however, increased competition led to decreased profits, leaving some card-club cities with losing hands. In addition, the large amounts of money involved led to corruption among some city officials. In the early and mid-1980s, 14 people in Bell and Commerce, including three city councilmen and a former mayor, were convicted of or pleaded guilty to charges of bribery and racketeering involving card clubs.

Located in the heart of the upscale Westside, West Hollywood has long attracted the interest of card club operators seeking to cash in on affluent patrons from Beverly Hills and the San Fernando Valley. Operators of card clubs in Southeast cities, such as Commerce, estimate that up to 30% of their customers come from the Westside.

Since incorporation in 1984, gambling proponents have periodically dealt out card club proposals to West Hollywood officials and to City Council candidates, hoping to find a way into the lucrative Westside market.

Most of those deals have folded quickly. During the 1986 elections, two current council members, John Heilman and Helen Albert, openly scoffed at the idea of allowing gambling in the city. But Cavendish lobbyist Decker said recent discussions with council members indicated that at least three of them, including Heilman, might be willing to put the issue to a vote. In addition to the continuing contact with elected officials, Cavendish lobbyists also conducted a precise campaign directed at more than 85 local service groups hoping to sell the idea, holding meetings with more than 20 of them.

Some of those efforts appeared to have paid off Monday night. The proposal received the endorsement of the Los Angeles Shanti Foundation AIDS support group, an influential voice in a city with a population that is more than 35% gay.

“Can any of us look into our consciences and reject this kind of proposal?” said Mallory Freeman, past director of Shanti Foundation. “It is going to be harder and harder to raise money for AIDS.” In addition, the proposal appeared to have the support of many residents of the city’s poorer east side, some of whom said they would welcome the club on their side of town. East-side residents played a pivotal role in the recent defeat of a proposal to build a civic center in West Hollywood Park, arguing that the city needs to pay more attention to its poorer half.

Investor Marks, a New York resident who also operates legalized gambling aboard two cruise ships, said Monday’s testimony indicated that much of West Hollywood would support the gambling club.

“A small, vocal minority really got up and controlled that meeting. I don’t think they expressed the thoughts of the people of West Hollywood,” Marks said. “We have an education job to do in this community. We are not ogres. We are business people.”