Article I — General Provisions

For the purpose of this chapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning.

“Chief Law Enforcement Officer of the City” means the City Manager.

“Commence” means and includes begin, initiate, start and open.

“Conduct” means and includes transact, maintain, prosecute, practice, manage, operate and carry on.

“Employee” means every person who is an agent of a legal gaming club or who acts under the direction of an owner or other employee of a legal gaming club or of a business conducted within the game room.

“Game room” means and includes that area or areas within the legal gaming club in which legal games are conducted. Any license issued hereunder shall designate such game room areas.

“Gross revenue of the legal game business” means and includes seat rental fees, and any and all other table revenues, but shall not include fees charged to players that are returned to the players as tournament prizes or jackpot bonuses.

“Legal gaming club” means a business or enterprise licensed under the provisions of this chapter for the playing of legal games.

“License” means a license for operating a legal gaming club.

“Owner” means every person, firm, association, partnership, corporation, or other entity having any interest, legal or equitable, in any legal gaming club or legal gaming club license.

“Person” means a natural person, or any other legal entity.

“Pointholder” means any person, having any interest whatsoever, or at all, in the ownership in a legal gaming club, whether legal, equitable, or of whatsoever kind of character.

“Purport to commence” and “purport to conduct” means and includes any showing, representation, indication or actions which:

1. By means of sign, advertisement or advertising matter, whether in, upon or about any premises or otherwise;

2. By the appearance or arrangement of any premises; or

3. By acts or statements of any person, or by the agents, servants, or employees of any person, indicates, suggests, holds out, or represents that any person is, would be, or appears to be conducting or in a position to conduct any business referred to in this chapter within the City.

(Prior code § 111.01)

The following rules and regulations are established and promulgated with reference to games for which licenses are issued under the provisions of this chapter. Licensees holding or obtaining licenses under the provisions of this chapter shall, in writing, agree to be bound by and observe each and all of the provisions of this chapter relating to such licenses.

• A. Rule No. 1. No licensee shall use, operate or permit the use or operation of more tables or units than those for which such licensee holds then current and valid licenses to operate or use in the City.

• B. Rule No. 2.

  1. No licensee shall permit any person to play in any game licensed by the provisions of this chapter while such person appears to be, or, in the opinion of the licensee or its duly authorized agents or employees, is under the influence of intoxicating liquor or drugs and no person under, or who appears to be under, the influence of intoxicating liquor or drugs shall play in any such game.

  2. No licensee shall permit any person to enter the premises while such person appears to be, or, in the opinion of the licensee or its duly authorized agents or employees, is under the influence of intoxicating liquor or drugs.

• C. Rule No. 3. Each licensee shall make available to any patron or potential patron of the gaming club written players’ house rules in booklet form that have been filed with and approved by the City Manager.

• D. Rule No. 4. No licensee shall operate or use any table or unit or manage, conduct or carry on any business or activity licensed by this chapter after the time that such license issued by the City has been or is expired, suspended or revoked pursuant to this chapter.

• E. Rule No. 5. Each and all of the games conducted or operated in the City pursuant to the provisions of this chapter shall be conducted and operated in full conformity with, and subject to, all the provisions of the applicable laws.

• F. Rule No. 6. No person under the age of 21 years shall be permitted by the licensee or by the licensee’s agents and employees in a gaming area, room, or casino at any time. This prohibition extends to employees and other personnel servicing the casino or gaming area. The licensee shall post “Persons Under 21 Prohibited in Casino” signs at all entrances to the gaming establishment. Lettering on signs shall not be smaller than 30 point. All persons under 21 years of age entering the prohibited area by intent or otherwise shall be immediately escorted from the prohibited area by the licensee’s security representatives. Any person under 21 years of age caught violating this prohibition on more than 1 occasion shall be immediately escorted by the licensee’s security personnel from the prohibited area and detained for a reasonable period of time, not to exceed half an hour, until City police representatives arrive. Police representatives shall have the discretion of escorting the violator from the premises, citing the violator, and, in the case of minors (persons under 18 years of age), advising the minor’s parents or guardians of the minor’s activities.

rity personnel from the prohibited area and detained for a reasonable period of time, not to exceed half an hour, until City police representatives arrive. Police representatives shall have the discretion of escorting the violator from the premises, citing the violator, and, in the case of minors (persons under 18 years of age), advising the minor’s parents or guardians of the minor’s activities.

• G. Rule No. 7. The playing of all games provided for in this chapter shall be confined to the areas designated as the “game room(s)” and no playing of any game provided for or permitted by this chapter shall be permitted at any other location on such premises.

• H. Rule No. 8. No licensee, operator, agent, and/or employee of any duly licensed gaming club shall assign, arrange for, or in any other manner sublet the conducting of games, directly or indirectly, with or without consideration, to any person not having a valid license to conduct such game. Nor shall any person conduct games as provided pursuant to the provisions of this chapter in a duly licensed gaming club not having a valid unrevoked license to conduct such game or games.

• I. Rule No. 9. A gaming club shall be open for inspection during all hours to the City Manager, or his/her duly authorized representative, without a search warrant.

• J. Rule No. 10. Gaming tournaments shall be prohibited unless the licensee files with the City Manager, at least 5 days prior to the commencement of the tournament, a full set of rules, regulations, terms and conditions to be used in regulating or otherwise governing the operation and activities of any such tournament, including minimum and maximum bets for such tournament play, and identifying the time and place of such tournament.

• K. Rule No. 11. If a licensee employs convenience dealers for the convenience of the players so that no player deals, while so dealing the convenience dealer:

  1. Other than dealing the cards and making collections as set forth in this section, shall not participate in any way in the game and shall not bet;

  2. Shall collect the posted seat rental fees and segregate and secure such amounts for collection purposes;

  3. Shall collect jackpot drops as posted; and

  4. Shall comply with regulations promulgated by the City Manager concerning identification standards.

• L. Rule No. 12. The only games permitted to be played in a licensed gaming club shall be those games that are legal in the State of California.

• M. Rule No. 13. The playing of all games provided for in this chapter shall be conducted in an area open to the public at all times and the games shall be played at tables in full view, and no doors, screens or other obstructions shall be installed or maintained so as to conceal the players at any table.

• N. Rule No. 14. The City Manager shall receive a copy of the seat rental rates charged by the licensee, and shall be apprised at least 10 days in advance of any proposed changes.

• O. Rule No. 15. The licensee:

  1. Shall collect the established seat rental fee and segregate and secure such amounts for collection purposes; and

2. Shall comply with regulations promulgated by the City Manager concerning the tabulation of gross revenue fees and such reasonable auditing procedures as deemed appropriate.

• P. Rule No. 16. The giving of credit or lending of anything of value to a patron and the cashing of checks of patrons shall be permitted only if the licensee’s written check cashing and credit policies are submitted and approved by the City Manager. No credit will be extended to City employees or officers.

• Q. Rule No. 17. Licensees holding valuables for safekeeping may do so only under the following conditions:

  1. Only cash may be held; no other valuable, including coins or paper money worth more than face value, may be held.

  2. Money deposited shall be secured by cash or other liquid assets or a security bond. Such security shall be sufficient to cover all money deposited.

  3. The actual deposits held and the records of all transactions shall be available for inspection by the City Manager or law enforcement officials upon demand.

  4. Licensee may operate a coatroom for the temporary storage of coats, umbrellas, and the like.

R. Rule No. 18. Pointholders, managers and employees may play in games. (Prior code § 111.02)

• A.

  1. It is unlawful for any licensed card club in the City to employ any person who does not have a valid, unsuspended and unrevoked employment identification card, bearing the employee’s photograph and all identification information on the badge issued by the card club.

  2. Any person wishing to obtain an employment identification card shall obtain one from the card room bearing the employee’s photograph and all identification information on the badge. This badge is presented to the City’s Chief Law Enforcement Officer with the completed City application. The applicant will be fingerprinted at that time and the identification badge will be stamped with a City seal and laminated. Should the Department of Justice report unfavorably, the card shall be revoked immediately and the licensee shall terminate the employee upon notification of such findings. The licensee shall immediately notify the City in writing of the date and time employment was terminated.

• B. Any person wishing to obtain an employment identification card shall file an application with the Chief Law Enforcement Officer of the City. The application shall be complete in all respects and shall include photographing and fingerprinting. A processing fee in an amount set by resolution of the City Council shall be paid to the City for such fingerprinting, issuance of the identification card and for a background investigation to be conducted by the Chief Law Enforcement Officer of the City. The fee shall not exceed the City’s reasonable cost of performing such processing.

• C. Each application shall contain, in addition to such other information as the Chief Law Enforcement Officer of the City shall require, the following current information:

  1. Residence address during the past 5 years;

  2. Current occupation or employment;

  3. Employment during the past 5 years;

  4. Physical characteristics, height, weight, and color of hair and eyes;

  5. A history of all convictions for any felony or misdemeanor offense, other than traffic violations, and of violations of any municipal codes or ordinances within the past 10 years;

  6. Driver’s license and Social Security numbers;

  7. A current full face photo.

• D.

1. The Chief Law Enforcement Officer of the City shall process the application and may approve, conditionally approve, or deny such application. He or she may deny an application for an identification card in the following cases:

   • a. If the applicant has been convicted of any crime punishable as a felony;

   • b. If the applicant has been convicted of an offense involving dishonesty;

   • c. If the applicant has engaged in bookmaking, loansharking, or other illegal gambling activities or has been convicted of an offense involving such activities;

   • d. If the applicant has made any false statement in the application or as to other information presented as part of the application process; or

   • e. If the approval of the applicant would be inimical to the interests of legitimate gaming.

2. If an application is denied, the applicant may appeal such denial by written notice to the City Manager who shall cause a hearing to be held within 30 days after such notice. The Hearing Officer, appointed by the City Manager, may approve, conditionally approve, or

deny such appeal. The Hearing Officer’s decision shall be final and conclusive. The cost of such hearing shall be borne by the applicant.

• E.

  1. An employment identification card may be suspended or revoked under the following circumstances:

     • a. The commission of an act which would have been grounds for the denial of an identification card pursuant to subsection D of this section; or

     • b. The violation of any condition imposed in issuing such identification card.

  2. The identification card may be suspended or revoked pursuant to applicable sections of Chapter 4.36 of the Desert Hot Springs Municipal Code, as may be amended.

  3. Refund. In the event of surrender, suspension, revocation, or expiration, no license deposit or fee, or any portion thereof, shall be refunded.

• F. Unless specifically excepted by the Chief Law Enforcement Officer of the City in writing, each employee, at all times while acting within the scope of their employment in the gaming room area, other than an employee participating in a game in accordance with subsection R of Section 17.152.020 , shall wear in a prominently visible place upon their person the identification card issued by the City.

• G. The licensee shall notify the City upon termination of any employee.

• H. The information received by the City pursuant to the provisions of this section shall be treated as confidential and shall be accessible only to those City officials having jurisdiction over the provisions of this chapter, and to management personnel of the licensee.

• (Prior code § 111.03; Ord. 695 10-15-19)

• A. Generally. It is unlawful for any licensee or any person having any interest whatsoever or at all in the ownership of a gaming club, whether legal or equitable, as trustor or trustee, or of whatsoever kind or character, to sell or transfer such points and/or interest without the consent and permission of the City Council first had and obtained.

• B. Required Information. Any person desiring to sell, transfer, assign, or otherwise hypothecate any point or interest in a gaming club duly licensed pursuant to the provisions of this chapter shall file with the City Manager a written application for permission to transfer such interest, as is hereinafter described. Each such application shall contain and clearly and truthfully set forth, under oath and/or affirmation, and show, in addition to such other information as the City Manager and/or the City Council may require, the following information:

  1. The date of the application;

  2. The true name of the applicant and proposed purchaser or transferee, and any other name by which the proposed purchaser or transferee has been known;

  3. The status of the proposed purchaser or transferee as being an individual, corporation, association, partnership, joint venture, trustor or trustee;

  4. The residence and business address of the proposed purchaser or transferee, if an individual;

  5. If the transferee is other than an individual, the true name, residence, and business address of each of the proposed purchaser or transferee pointholders, partners and officers;

  6. A full and complete financial statement of the proposed purchaser or transferee, whether it is an individual, corporation, partnership, or other entity, and a full and complete financial statement of each proposed purchaser or transferee pointholder, partner or officer; provided, the financial statements required by this subsection shall be deemed confidential in character and shall not be open to public inspection, but shall be available to those City officials having jurisdiction over the provisions of this chapter and to any court of competent jurisdiction where any matter relating thereto may be actively pending;

  7. The name of the licensed legal gaming club for which a transfer of interest or point is sought;

  8. The number of points and/or the nature of interest sought to be sold, transferred, assigned or otherwise hypothecated; and

  9. A statement that the application will be considered by the City Council only after a full investigation and report has been made by the City Manager and the report of investigation forwarded to the City Council.

• C. Investigation Required. Whenever an application pursuant to the provisions of this section has been filed with the City for a sale or transfer pursuant to the provisions of this section, the City Manager shall promptly and diligently make an investigation and shall report to the City Council with reference thereto within 60 days from the filing of the application, as follows:

1. A full and complete investigation of the proposed purchaser or transferee (including the proposed pointholders, partners or officers), including a determination that the proposed purchaser has obtained, or will have obtained, from the California State Attorney General a valid registration pursuant to the Gaming Registration Act of the State.

   2. Concurrently with the filing of the application, each person named in the application as a proposed purchaser or transferee, or pointholder, partner or officer thereof, shall be fingerprinted by the City Manager or designee, and no application shall be deemed filed until the fingerprinting is completed.

• D. License Fees. Each such sale or transfer application shall be accompanied by a processing fee in the amount of $250 per person named in the application as a proposed purchaser or transferee, or pointholder, partner or officer thereof, to cover the cost of the investigation. The fee set forth in this subsection shall be the property of and be retained by the City, whether the application for sale or transfer is granted or denied.

• E. Granting or Denial of Application.

  1. Consideration by City Council. Whenever an application for such a sale or transfer is presented to the City Council, the City Council shall consider such application on the same basis as is applicable to the new license application.

  2. Decision of the City Council. The City Council shall not approve an application if the proposed purchaser has not first obtained a valid registration from the California State Attorney General pursuant to the State’s Gaming Registration Act. Otherwise, the City Council may in its sole discretion either approve, conditionally approve, or deny the application with specification of grounds.

• (Prior code § 111.04)

• A. All pointholders holding points in any legal gaming club, as well as the partners or officers of such legal gaming clubs, whether or not they hold any points in such clubs, shall have their

background investigations updated annually and regularly thereafter pursuant to a schedule established by the City Manager. Such updating shall consist of a check by teletype to criminal investigation and identification in Sacramento, California, and the filing by each licensee, pointholder, and partner or officer thereof, of updated financial statements. A fee in the amount of $10 for each pointholder so investigated shall be paid to the City by the respective legal gaming clubs or licensees on a semiannual basis to cover the costs of such investigations.

• B. Any person having any interest whatsoever or at all in the ownership of a legal gaming club, whether legal or equitable, or a trustor or trustee, or of whatever kind or character, who has not previously submitted to the procedure required under Section 17.152.040(B) through (E) , shall file, as a prerequisite to the continued holding of an ownership interest, the application to be investigated, pay the fee, and be reviewed by the City Manager and City Council as provided in that section for persons applying for new ownership interest. If the City Council denies any application, within 120 days after the receipt of a notice of such denial, such person shall divest himself or herself of such ownership interest.

• C.

1. The approval of a pointholder may be revoked or suspended by the City Council after a hearing held not less than 30 days after notice has been given to the pointholder if the City Council finds that:

   • a. The Attorney General of the State has suspended or revoked the pointholder’s registration under the Gaming Registration Act of the State;

   • b. A pointholder has violated, or permitted, allowed, or caused the violation of any provision of this chapter, any regulation issued pursuant to this chapter, any condition of approval imposed upon the issuance of the card club license, or any State law or regulation relating to the operation of a card club; or

   • c. A pointholder has made any fraudulent statement as to a material fact on an application form or as to any other information presented as part of the application process. The City Council, in making its decision, shall consider any mitigating factor presented by the point-holder.

2. The ownership interest shall be divested within 120 days after the notice of revocation. Failure to do so shall constitute a misdemeanor, and each day of noncompliance shall constitute a separate and complete offense. In addition, the City Attorney may invoke appropriate civil remedies to enforce compliance.

3. No person required to divest an ownership interest in a legal gaming club following a revocation of approval shall transfer such ownership interest to his/her spouse, child, sibling, or parent or to his/her spouse’s child, sibling or parent without the approval of the City Council.

(Prior code § 111.05)

• A. Unlawful Locations. It is unlawful for any person to play, or permit the playing, of any game regulated or referred to by the provisions of this chapter at any place within the City, except a place operated under a permit and licensed under licenses held or issued pursuant to the provisions of this chapter.

• B. Unlawful Games. It is unlawful for any person to play in, or permit the playing of, any game at any place licensed pursuant to this chapter which game is not permitted by the provisions of this chapter, or any game played in violation of this chapter.

• C. Unlawful Attractions. A licensee shall have the right to advertise in the newspaper, over the radio and television, and in any other legal way the licensee sees fit. No licensee shall engage in false or misleading advertising in connection with gambling.

• D. Operation of Game Rooms. It is unlawful for any operator of a game room permitted under this chapter or for any owner, principal employee or agent of a game room permitted under this chapter:

  1. To allow to be wagered by any player any amount in excess of the posted wagering limit for the table at which the player is then playing, except as is specified in the players’ house rules.

  2. To knowingly permit any unlawful activity to take place upon the premises of the legal gaming club or to fail to exercise due diligence to prevent such activities from taking place, including but not limited to illegal gambling activities, prostitution, and cheating. The City Manager shall have the power to formulate reasonable policies and procedures to control such activities, and these policies and procedures may, in the City Manager’s discretion, be published in the players’ house rules.

• E. Cheating. It is unlawful for any person to attempt to gain any unfair advantage for any player in a licensed legal gaming club through a fraudulent technique or mechanical or electrical device. Prohibited cheating techniques include, but are not limited to, the following examples:

  1. It is unlawful for any person as a player or dealer to attempt to deal, draw, distribute or burn any playing cards other than the top card of a deck.

  2. It is unlawful for any person to attempt to prearrange or to shuffle any playing cards, other than in a random manner.

  3. It is unlawful for any person to attempt to alter in any way the shape, appearance, texture or number of cards in play, or to switch any card.

  4. It is unlawful for any person to attempt to use any apparatus to gain information not available to other players.

(Prior code § 111.06)

• A. A licensee may exclude or eject from the premises any person who has been engaged in or been convicted of bookmaking, loansharking, the sale of controlled substances, illegal gambling activities, cheating, prostitution or whose presence in or about such legal gaming club would be inimical to the interests of legitimate gaming. No person shall be excluded or ejected on the grounds of race, color, creed or gender.

• B. Any person excluded or ejected by a licensee may appeal to the City Manager as to whether the conditions for exclusion or election set forth in subsection A of this section are applicable. The City Manager shall appoint a Hearing Officer who shall conduct a hearing at which time both the person excluded and the licensee may present evidence. The decision of the Hearing Officer shall be final. The licensee and appellant shall reimburse the City for the cost of holding such hearing in amounts determined by the Hearing Officer.

(Prior code § 111.07)

• A. The City, in adopting the provisions of this chapter and establishing the regulation of the businesses operated or to be operated by a licensee who permits the playing of legal games

authorized by this chapter, declares that the playing of games not prohibited by statute is conducive to public morals when the same are played and conducted according to all the laws, rules, regulations, and provisions as set forth in this chapter, and that in any proceedings to annul a license issued pursuant to the provisions of this chapter, or to abate the business conducted hereunder, or to prosecute the licensee or his/her employees for any acts authorized thereby, it shall be presumed that such acts are not unlawful and that such business is not a public or private nuisance.

• B. The City finds that the issuance of written checks by players to legal gaming clubs and the granting of credit to players by legal gaming clubs to facilitate the playing of legal games is not contrary to an express provision of law, not to the policy of express law, and is not otherwise contrary to good morals. It is the intent of the City Council that California Civil Code Section 1667 not apply, and that both players and legal gaming clubs be entitled to take their contractual disputes to court.

(Prior code § 111.08)

The City Manager, at the direction of the City Council, shall formulate in writing all necessary rules and regulations to implement and administer the provisions of this chapter, and shall do all things necessary and proper to carry out the spirit and intent of this chapter, including, but not limited to:

• A. Preserving and keeping all documents identified in this chapter as confidential documents so that the contents thereof shall not become known except to persons required by law to effect the administration or enforcement of this chapter;

• B. Promulgating and/or requiring prior approval of accounting procedures to be utilized by licensees to ensure accurate reporting of legal gaming club revenues; and

• C. Delegating the duties and powers vested in the City Manager by this chapter to appropriate City employees or officers.

(Prior code § 111.09)

The deposit and fees provided for in Sections 17.152.030 through 17.152.050 , 17.152.160 , and 17.152.210 of this chapter may be modified by a duly adopted ordinance of the City Council so as to defray the actual costs associated with the City’s activity covered by those sections. (Prior code § 111.10)

The City Council shall have the power to amend provisions of this chapter, provided that any such amendment shall not be inconsistent or in conflict with the purpose of this chapter of permitting the operation of gaming clubs. Except as otherwise required by statutes or the Constitution of the State of California or by applicable decisional law, any amendment shall require a noticed public hearing and adoption by a four-fifths affirmative vote of the total number of seats on the City Council, except for Sections 17.152.150 , 17.152.170 , 17.152.190 , 17.152.200 and 17.152.220 of this chapter which may only be amended by a unanimous vote of the total number of seats on the City Council. (Prior code § 111.11)

The applicant for a license, permit, or other approval pursuant to Sections 17.152.030 through 17.152.050 , 17.152.160 or 17.152.210 of this chapter shall reimburse the City for the actual costs associated with the City’s processing of the application. Upon submitting an application for any such approval, the applicant shall enter into with the City a “Memorandum of Understanding” that shall provide that the applicant reimburse the City for all such costs. The applicant shall deposit with the City an amount estimated by the City to cover the City’s anticipated costs. Additional deposits shall be made, if necessary. Any part of a deposit not actually spent by the City shall be returned to the applicant.

(Prior code § 111.12)