Atty. Gen. Dan Lungren’s office has urged Gov. Pete Wilson to veto legislation that would allow the owners of Hollywood Park to expand their wagering operation into the card room business--and has engaged the bill’s author in a bitter exchange over how to control California’s growing gambling habit.
In a letter, Lungren’s chief deputy told Assemblyman Curtis Tucker Jr. (D-Inglewood) that his bill would open the door to out-of-state interests to establish a foothold in California’s lucrative card room industry.
Chief Deputy Atty. Gen. W. David Stirling contended that the clubs are already so loosely regulated that they are “vulnerable to charges of organized crime influence, racketeering, skimming, money laundering and other corrupt practices.”
In the toughly worded letter, Stirling accused Tucker and the card clubs of sabotaging Lungren’s bid for a tough Nevada-style gaming commission to oversee card rooms.
He maintained that the Assembly Governmental Organization Committee that Tucker has chaired for the past year is controlled by the card clubs, which dictate legislation “line by line and page by page” intended solely for the clubs’ economic benefit.
Tucker shot back by accusing the attorney general’s office of pursuing a costly and unworkable scheme with its gaming commission proposal. He said the attorney general’s intent was to pressure him into supporting creation of the commission in return for Lungren’s neutrality on Tucker’s Hollywood Park bill.
“You don’t hold a gun to my head and say we want everything. . . . That’s not negotiation. That’s blackmail,” Tucker said in an interview.
The exchange underscores the increasingly contentious fight in the Capitol as a variety of interests, from race tracks to Indian gaming, attempt to cash in on California’s expanding appetite for gambling.
In recent years, the number of California card rooms, chiefly regulated by a hodgepodge of local ordinances, has grown to more than 300. Lungren has estimated that between $7 billion and $8 billion is wagered annually at California’s card clubs.
Seeing that potential, Inglewood voters last year approved a ballot measure to permit a card club on the grounds of Hollywood Park, which is being turned into a multifaceted entertainment complex expected to bring several thousand jobs to the economically depressed city. Up to 200 card tables are to be located in the track’s Cary Grant Pavilion, scheduled to open next year.
But there is a hitch.
California has never allowed a publicly traded company such as the race track to own and operate a card room. Under state law, anyone with a financial stake in a club must register with the attorney general’s office. The law has restricted registrants to individuals on the grounds that requiring thousands of shareholders to register would swamp state resources.
Tucker’s bill would create an exemption for Hollywood Park.
It also would allow the track’s principal shareholder, R. D. Hubbard, to conduct gaming in California even though he is engaged in gambling in other states that is illegal in California, Stirling said.
Hollywood Park officials could not be reached for comment Wednesday. In the past, the track has contended that it has been in the gaming business for years with parimutuel betting on horses and has always passed muster with the state.
At least some card room operators are urging Wilson to reject Tucker’s bill, saying it would give the track an unconstitutional advantage over other card rooms.
Paralleling his push for the race track, Tucker sought a compromise with Lungren to establish state regulation of card clubs. Tucker said the proposal would have allowed other public corporations to own card clubs.
Stirling said that in early September, negotiators reached an agreement. But at the last minute, he contended, changes were made to weaken the proposal and Lungren withdrew his support.
Lungren’s office also is asking Wilson to veto a companion measure by Assemblyman Bill Hoge (R-Pasadena) because of a provision requiring Hollywood Park to pay the state $100,000 to administer registration of card club operators. Stirling told Tucker the special fee is designed to benefit only one applicant and “suggests an inappropriate quid pro quo to obtain the approval of the governor.”
Even though Lungren has lobbied Wilson directly to veto the Tucker bill, Tucker is optimistic that the governor will sign it.
A spokesman said Wilson, who has until midnight Oct. 11 to act, is reviewing the proposal and has not taken a position.