BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
1125 (Florez)
Hearing Date: 05/03/2010 Amended: 04/20/2010
Consultant: Maureen Ortiz Policy Vote: GO 8-0
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BILL SUMMARY: SB 1125 requires the Department of Justice and
the California Gambling Control Commission to establish an
enhanced fee schedule for applicants who wish to have their
applications processed and background investigations conducted
in an expedited manner. The bill also provides that jackpot
funds are considered trust funds, and permits a person between
18 and 21 years of age to work in a gambling establishment under
specified circumstances.
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Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12 2012-13 Fund
Jackpot funds -----------minor,
absorbable-------------- Special*
Enhanced fee/processing $132 $263
$263 Special*
potentially offset by fee revenue
Under age 21 permits ----------minor,
absorbable-------------- Special*
*Gambling Control Fund
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STAFF COMMENTS:
The California Gambling Control Commission (CGCC) indicates
minor, absorbable costs to promulgate regulations relating to
the interpretation of jackpot funds. These regulations would be
developed over the FY 2010-11 and FY 2011-12. The CGCC
anticipates the need for .4PY for Staff Counsel ($51,808) and 2
PYs for Associate Governmental Program Analysts ($211,419) to
develop regulations relating to the expedited application
processing. These costs would likely be offset by increased fee
revenue, however the extent of the offset will be dependent on
the number of applicants who opt to pay the additional fee in
order to obtain a shorter processing timeframe. The CGCC also
indicates minor, absorbable costs for promulgating regulations
related to the provision that authorizes persons aged 18-21 to
be employed on the gambling floor. The Department of Justice
(DOJ) will incur some expenses for processing the expedited
background checks, although increased fee revenue should offset
those costs. DOJ does point out that an enhanced fee alone does
not expedite the process without the authorization to hire
additional staff.
Specifically, SB 1125 provides that jackpot funds held by a
gambling establishment, to which players have made
contributions, following the deduction of any administrative
fee, are to be considered trust funds that are held for the
benefit of the players. The jackpot funds are declared not to
be the property of the gambling establishment. There
SB 1125 (Florez)
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are currently no regulations promulgated by either the Gambling
Control Commission or the Bureau of Gambling Control within the
Department of Justice that specify how any
jackpot funds are to be disbursed if a gambling enterprise such
as a card club goes bankrupt.
Existing law prohibits any person under the age of 21 from
entering the premises of a licensed gambling establishment with
the following exceptions:
1) A dining area that is physically separated from any gambling
area;
2) Restrooms;
3) A supervised room that is physically separated from any
gambling area and that is used for the purpose of entertainment
or recreation;
4) A designated pathway through the gambling area which
requires any person under the age of 21 to be accompanied by a
person over the age of 21
SB 1125 will authorize a person between the ages of 18 and 21 to
obtain a work permit to work at a gambling establishment
provided the person does not work as dealer, floor men, or any
other employment classification that exclusively involves
working on the floor of the gambling establishment. The intent
of this provision is to allow persons under the age of 21 to be
employed in jobs such as food service or maintenance that
requires the person to occasionally be on the gaming floor. The
bill specifically prohibits such a person from providing
services that are involved in the play of any controlled game.
This bill also replaces the word "house" with "gambling
enterprise" in the definition of a "banking game" or "banked
game". Existing law defines "house" to mean the gambling
enterprise, and any owner, shareholder, partner, key employee,
or landlord. Existing law defines "gambling enterprise" to mean
a natural person or an entity, whether individual, corporate, or
otherwise, that conducts a gambling operation and therefore
holds a state gambling license.