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Issue: Card Clubs

June 03, 1993|Kirsten Lee Swartz, Times community correspondent

As cities grapple with budget problems, some are considering legalizing card casinos to help pay for services. Compton officials approved a license for a card club in December. Pico Rivera

voters will decide the issue in Tuesday. Card clubs rent seats to customers and give 8% to 13% of the fee to the city. Is gaming an effective way for a city to fill its coffers?

Peter L. Wallin

Pico Rivera developer

From 1976 through last year, I was the city attorney for Bell Gardens. The Bicycle Club did a tremendous job making Bell Gardens a fiscally stable

city. Today while other cities are having trouble balancing their budgets, Bell Gardens has none of those problems because the card club does such a good job. While I haven't been associated with the budget planning for this year, I think the Bicycle Club revenues generally make up as much as 60% of the city's budget. It is so lucrative for cities. Even if two businesses do the same amount of volume per dollar, a card club still brings in about 10 times the revenue. If a car dealership does $30 million in sales, a city would get approximately 1% of the sales tax. A tax on the Bicycle Club is about 10%. They provide a maximum of income for a city at a minimum of cost because card clubs tend to regulate themselves. They're self-policed.

George G. Hardie

The Bicycle Club General Manager

Bell Gardens took a chance on the club, and we've been good partners in providing not only revenue for the city but we have 2,000 employees here, quite a number of whom live in Bell Gardens. But now everyone wants to jump in. And the bottom line is there just aren't enough players available. That is why they restrict the number of sports teams. You know there are only so many fans. If it gets too crowded, nobody will make money. Our customers don't come just from Bell Gardens. They come from everywhere within an hour and a half's drive. I do take an active stance opposing competition because it is doubtful whether they will be successful. It is difficult for a city to rely on that revenue year in and year out. The industry has great volatility to it, and a city can be left holding the bag.

Omar Bradley

Compton city councilman As you know, there isn't a government agency right now that's not strapped for cash. Our staff reports that the card club will bring in $2 million in the first year and $4 million in the second year. It will certainly help us stay on board. If we can make money without spending money, that is the kind of business we want to bring to the city of Compton. We have to find businesses that can come here with their own dollars and who are willing to invest. If the card club fails, the city has not lost a dime, whereas we have $26 million tied up in the city's hotel because we floated bonds to build it. If the card club doesn't work, I don't have to go to the taxpayers and raise their taxes because it failed. Our card club will be located five minutes from four freeways. General locale is often very important. I also hope it works because of the 1,200 jobs it will bring.

Rev. High Vines Jr.

President Compton Inter-Denominational Ministers Assn.

I don't see the viability of it economically. There is an over-proliferation of them, and I don't think adding more would be profitable. Also, card clubs do not make a return on the money invested by the spender. For instance, if I lose $100 in a card club, I get nothing in return for my investment. If I spend $100 in a grocery store or $100 in a gas station, I get goods and services in return for my money. It may be profitable for the casino, but for the community it's a loss. We will have to police problems that develop from the card club. That is a very important thing to look at. Our Police Department will be spread a little thinner. It would be better to have businesses and industries that give a fair return for one's labor and one's investment. Retail. Manufacturing. Auto-making. Not gambling.

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