Know when to hold ‘em: Dallas City Council ups the ante in poker house legal fight
The Dallas City Council approved more funds to pay legal fees in an ongoing battle over poker houses in the city, during Wednesday's meeting. But some council members questioned when the litigation would end — and whether there was a better option the city could take.
The case involves a dispute over the city’s Building Official revoking certificates of occupancy from two poker houses. But the city’s board of adjustments overturned the revoked permits which led the building official to file a lawsuit against the board.
District 1 Council Member Chad West, who previously questioned the economic implications of essentially banning poker houses, says he would support the item — but had questions for Dallas officials.
“I am begrudgingly supporting granting more attorney’s fees for this ridiculous ordinance that we have supported as a council,” West said during Wednesday's meeting. “Where does it end? When do we stop paying for this litigation?
This isn’t the first-time council members “begrudgingly” agreed to fund legal representation for the two city entities.
In October 2022, a Dallas County judge ruled that the “Board of Adjustment abused its discretion and made an illegal decision" when it decided to reverse the revocation of a poker houses’ certificate of occupancy. One company operating one of the houses appealed the decision.
In late January, council members voted to pay outside attorneys over $500,000 to fund the next steps in the case. About half of the money was spent to fund Andrew Espinoza’s — the city’s chief building official — legal team. The rest was spent funding legal representation for the board of adjustment.
“I do adamantly believe we are suing ourselves and wasting taxpayer dollars in order to take somebody’s grudge against poker rooms,” District 6 Council Member Omar Narvaez said at a late January council meeting.
West expressed concern over potential lost revenue from the gambling houses.
“This is Dallas, we’re supposed to be a city that is pro-business and business friendly,” West said in January.
Interim City Attorney Tammy Palomino says that the city needs to continue the legal battle.
“We have a favorable judgment out of the trial court,” Palomino said during Wednesday’s meeting. “It is in the best interest of the city to defend the favorable judgment in the trial court.”
'Underground and in the shadows'
During earlier discussions over the issue, council members asked city staff to brainstorm a way that poker houses could operate legally. But Planning and Urban Design Assistant Director Andrea Gilles says between the new short-term rental ordinances — and other city priorities — that process might not be immediate.
“We anticipate being able to get to this ordinance in the fall of this year,” Gilles said.
Gilles says when the department begins the process of crafting an ordinance to accommodate poker houses it will include a staff review and a zoning review. From there it has to be approved by the city’s plan commission and then the city council.
As of right now, there has not been a draft sent to the city’s zoning commission. Gilles says she anticipates the proposed ordinance would be reviewed in either September or October.
But not all council members agreed with a plan to carve out space for the gambling houses. District 12 Council Member Cara Mendelsohn questioned what the city could draft if a judge ruled the land use illegal.
“What could you possibly bring to us,” Mendelsohn said. “…when has the judge determined it’s an illegal use?”
Council members want to know if there was a simple solution out of the legal tangle. But the city attorney’s office says the court date will come sooner than city staff can get a proposed ordinance reviewed by the zoning commission and city council.
Palomino says under the current model the business is illegal — but that could change once the city figures out an alternative.
Palomino says the potential legal use would include the poker houses in a private space, with “no economic benefit” to the operators.
“We can always talk to them once we get the model changed,” Palomino said. “To see if they want to change their model.”
In the meantime, Dallas officials say poker houses will still operate — just illegally and underground. The sooner there is a framework for operating the business legally, the more legal revenue they can generate.
“The folks that do work in these places, tend to make a lot more money when it’s done through a legal process” Narvaez said. “Then when it’s done underground and in the shadows.”
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