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Bell Gardens projects $2 million shortfall in card-room revenue; council weighs options
Summary
Finance director reported a projected FY25/26 year-end card-room revenue of about $17.013 million, roughly $2 million below the $19.02 million budget, citing litigation and proposed AG regulations as risks; staff outlined contingency options including a local sales-tax ballot measure and exploring cannabis and water-sale revenue.
City finance staff told the Bell Gardens City Council on Jan. 26 that card-room revenue—the largest single contributor to the general fund—was projecting a year-end shortfall of roughly $2 million.
Manuel Carrillo, director of administrative and financial services, said the city budgeted $19,020,000 in card-room revenue for fiscal year 2025–26. Using the first six months’ actuals and a daily-average projection, staff estimate year-end card-room receipts of about $17,013,000. Carrillo said the projection reflects current operating trends and market conditions.
Staff warned the council that recent state developments could affect long-term card-room revenue. Assembly Bill/SB 549 (signed into law Sept. 24), and related litigation, allowed tribes to sue private card rooms over specific table games; while a court dismissed such suits in October 2025 on federal preemption grounds, the tribes may appeal. In addition, proposed regulatory changes from the California attorney general’s office—such as rotation requirements for third-party proposition players or changes to blackjack-style games—could slow the pace of play and reduce revenue if enacted.
Carrillo and city manager Mike O’Kelly said staff and the card-room joint powers authority (JPA) continue contingency planning. Options under study include a local sales-tax ballot measure (estimated to raise about $1.3 million annually if adopted), pursuing retail cannabis revenues (six development agreements were mentioned as prospects), the potential sale of the water system (an RFP published in December), and a general fee study. The city will bring a midyear budget review to council on Feb. 23 to provide a comprehensive revenue and expenditure update.
Council members asked about timing of finalized card-room figures; Carrillo said confirmed monthly figures are received by the 15th of the following month (e.g., December figures were received Jan. 15). Police and the chief also updated the council on an ongoing investigation into two hoax-bombing incidents that included the city’s card room; the chief said leads exist and outside agencies are assisting.
Why it matters: Card-room receipts account for a substantial portion of the general fund; a sustained revenue decline would force the city to identify new revenue sources or reduce spending. Council direction on contingency options will shape midyear budget choices.
Next steps: Staff will present a midyear budget review on Feb. 23 and return with options and recommendations for revenue stabilization, including potential ballot measures and other revenue strategies.
