Assembly OKs Bill to Create Gaming Commission : Legislature: Backers want to weed out any criminal element involved in card rooms. Senate fate is uncertain.

SACRAMENTO — Legislation to create a state commission to regulate California’s rapidly growing gambling industry was overwhelmingly approved Thursday by the Assembly.

A 62-4 vote sent the bill, backed by Republican Atty. Gen. Dan Lungren and authored by Assemblyman Phillip Isenberg (D-Sacramento), to an uncertain Senate fate.

Senate President Pro Tem Bill Lockyer (D-Hayward) wants a statewide gambling economic impact study to be conducted, which could slow the bill’s progress.

State officials estimate that $12.7 billion was legally wagered in California in 1993, putting the state third behind Nevada and New Jersey, both of which have casino gambling.

As much as $8 billion of that amount was generated by locally licensed card rooms, where Lungren and Isenberg fear that organized crime may be obtaining a foothold.

The $8-billion figure means that card rooms generated twice as much money as the state lottery, horse racing and charitable bingo games, Isenberg said.

“The evidence is growing that criminal abuse of card rooms is a substantial problem” he said, “and that includes loan-sharking and money laundering.”

Assemblywoman Barbara Friedman (D-North Hollywood), who urged a yes vote, said: “This bill gives law enforcement the tools they need to weed out the criminal element involved in gambling.”

The legislation calls for the formation of a five-member, appointed state gambling commission to license card rooms and conduct background checks on everyone connected with card room business operations.

The bill does not say who would appoint the commissioners. Isenberg said this would be worked out before final passage.

A gambling control division would be set up within Lungren’s office to enforce state gaming laws and strict record-keeping requirements.

The measure also requires a two-thirds local vote to approve new card rooms or to expand existing ones, and includes substantial safeguards against conflicts of interest by commission members and key staff.

The program would be paid for by fees and investigation assessments levied on the card room industry.