California labor unions warn of economic fallout from bill allowing tribes to sue cardrooms

Multiple labor unions in California are opposing Senate Bill 549, a proposed law that would grant gaming tribes the authority to sue California cardrooms, citing concerns about the potential impact on tax revenue and public sector jobs across the state.

Introduced by Senator Josh Newman in February 2023, SB 549, also known as the Tribal Nations Access to Justice Act, would allow gaming tribes to take legal action against licensed cardrooms, seeking court rulings on whether card games violate state law and tribal gaming rights. However, unions and several cities argue that the legislation could have severe financial consequences for local governments that rely on cardroom tax revenue.

The California Gaming Association, Communities for California Cardrooms, and California Cardroom Alliance have requested the state legislators to oppose the bill. The American Federation of State, County, and Municipal Employees (AFSCME), SEIU California, Teamsters Local 630, and California Professional Firefighters are opposing the bill. 

“SB 549 could have a devastating impact on public sector jobs,” the labor unions wrote in a joint letter. The unions described the bill as "an attack on local cardrooms" that serve as crucial sources of revenue for many cities.

Cities across California, including San Jose, Chula Vista, Oceanside, Commerce, and Hawaiian Gardens, have also expressed opposition. Hawaiian Gardens derives 78% of its general fund from cardroom revenue, while Commerce relies on cardrooms for 50% of its budget. The potential loss of these funds could disrupt essential services like police and fire departments, according to the unions.

"The measure could easily force cardrooms out of business and result in a loss of $500 million in tax revenue statewide," the unions warned. The unions also highlighted the possible effects on cardroom employees. "The mere cost of litigation alone could lead to lower wages, loss of jobs, or cardroom closures," the letter stated.

Supporters of SB 549, including the California Nations Gaming Association, argue that the bill is essential for upholding tribal gaming rights. James Siva, Chair of the association, emphasized that tribal governments should oversee the future of gaming in the state. “The future of gaming in California will be overseen by the state’s tribal governments, not outsiders who think they know what is best for tribes,” Siva said.

If passed, the bill would permit a one-sided legal avenue, allowing tribes to sue cardrooms but not the other way around.