Bankruptcy, relocation in the cards for Player’s Casino in Ventura
After most of a year of not being allowed to operate, the Player’s Casino in Ventura has filed for bankruptcy and left its location on Auto Center Drive.
The Player’s Casino is the only licensed card room in Ventura County, and one of 86 in California. The owner, Monica Donohoo, inherited the business in 1996 when her husband, Pinky Donohoo, died after owning the club for more than half a century. She moved the card room to the Ventura Auto Center in 2011, trading up from a small building in West Ventura and changing the name from the Player’s Card Club.
A little more than a year ago, the Player’s Casino laid off 183 workers in what it said was a temporary closure due to the COVID-19 pandemic. But the business has not re-opened, even though state regulations now allow it to open indoors with limited capacity, and on April 6 it filed for Chapter 11 bankruptcy, or a debt reorganization.
Its bankruptcy attorney said the business is looking for a new location in Ventura.
“(Player’s Casino) has worked with the city throughout this process in anticipation of moving,” said Michael Kogan, an attorney representing the card room. “The city understands what’s going on. We keep them in the loop.”
The card room’s landlord, Hofer Properties and Hofer Vineyards, filed a motion April 11 objecting to the bankruptcy. The court filing says the Player’s Casino left its lease early after extending it for five years, and in leaving early damaged the facility “significantly.” It also called into question the need for the card room declare bankruptcy, calling the business “immensely successful” prior to the pandemic.
“It was generating $14 million in gross revenue annually and there is no reason to think that it would not continue to do so at the same location,” Hofer said in its motion.
In its response, the Player’s Casino said it vacated the premises in March at the end of its lease, and that no new lease had been made. It also cited an analysis from the short period of time last year when the casino was allowed to reopen. According to the analysis, the casino lost about $100,000 per month by opening outside or opening with a limited amount of guests indoors and outdoors.
The card room was allowed to reopen its doors for indoor operations on April 7, when Ventura County entered the orange tier of California’s pandemic reopening system, but Kogan said the restrictions at the orange tier make reopening not economically feasible for the casino.
In the orange tier, card rooms can have up to 25% capacity indoors, with additional restrictions on how many people they can have outdoors. Once a county gets to the yellow tier, card rooms can have up to 50% of their capacity inside, but Ventura County isn’t there yet.
“It’s not like opening a restaurant, where you can put some tables in the parking lot and it just works,” Kogan said, citing additional concerns, like security, that can’t be easily transferred to an outdoor staging area. “It’s expensive. The starts and stops kill you.”
The card room and its accompanying restaurant took a big financial hit during the pandemic. In 2019, the business cleared $16.4 million, according to its bankruptcy filing, and in 2020, its revenue was just under $4 million.
In its bankruptcy filing, the Player’s Casino declared around $3 million in assets and $3.5 million in debts. The vast majority of the debt consists of two federal Paycheck Protection Program loans from Comerica bank, totaling $3.2 million. The first PPP loan was taken out on April 22, 2020, and the second one was taken out on Feb. 8, 2021.
The business has about $2.5 million in cash, cash equivalents and financial assets, with $2.3 million in its main checking account, according to its bankruptcy filing. It owes $88,000 to the Bureau of Gambling Control, as well as $18,249 to the Ventura County Tax Collector.
The Player’s Casino is currently looking for a new card room location, and in the meantime it has moved its corporate headquarters to a location on Meta Street in downtown Ventura. The restaurant that served people who visited the Player’s Club has closed as well, and while some of the signs are still up at the Auto Center Drive building, Kogan said all of the equipment has been moved into storage.
Kogan said the business is looking for a place where it can reconnect with its regulars and attract new players.
“We’re waiting for the situation where we can operate in a proper way,” he said.
The card room is licensed through the city of Ventura and the state, and still holds active licenses on both fronts. The city license goes through June 30, while the state’s license goes through February 28, 2022.
The Player’s Casino is a major taxpayer to the city of Ventura. The card room pays a 15% tax on its gaming revenue, which is almost double the sales tax rate that a retail shop would pay to the city.
The city’s 2019-2020 budget included $2.075 million in card room taxes, out of a general fund of around $120 million. That translates to $13.83 million in gaming revenue for the Player’s Casino.
Mike Johnson, a Ventura city councilman, called the card room’s closure “a blow to the city” in an April 9 Reddit post responding to questions about the business.
“Over the last three weeks, staff has had to go and cut $2 million from next year’s budget, which we need to adopt in the next two months,” Johnson wrote. “I don’t know what they cut from the proposed budget, but last year the city froze nearly 30 vacant positions and was intending to start thawing them back out.”