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A Risky Area to Gamble With : State needs the power to monitor local gaming clubs

August 14, 1994

Legislation to bring needed oversight to California's booming card club and casino industry is being dealt a losing hand in Sacramento, where some legislators seem to see the political odds as favoring delay rather than action. That's shortsighted.

Government errs when it waits too long to regulate in an area where oversight clearly is needed. Legalized gambling is a classic case in point. In Nevada, which now boasts a thriving tourist industry aimed increasingly at the family business, it took law enforcement decades to clean up the corruption and crime that tainted the gaming industry. By failing to act now the California Legislature risks letting these problems become entrenched, as Nevada did.

In 1992, gamblers in the Golden State bet $12.5 billion. Over half was wagered at card clubs and casinos, the fastest-growing segment of legalized gambling in the state.

Unlike the state lottery or horse racing, there is no state regulatory agency to monitor the gaming industry. Local governments simply do not have the staffs and the expertise to block money laundering, tax evasion and extortion.

AB 2803 and AB 362 are two bills that would give the state oversight power and allow it to assemble the requisite expertise. They are sensible and bipartisan. They were written by Democrats and endorsed by state Atty. Gen. Dan Lungren, a Republican. They would create a state agency to license card clubs and casinos operating within the state. Modeled after Nevada's system, the California Gambling Control Commission would work in conjunction with a new Division of Gambling Control within the attorney general's office.

Much as the state Lottery Commission and the Horse Racing Board are financed from gambling revenues, the state gaming regulation agencies would be funded by gaming fees from the casinos.

The bills would preserve the local option to reject card clubs. They are reasonable measures to help avoid potential problems, and they deserve support from both friends and foes of legalized gambling, not to mention members of the Legislature.

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