During the pre-holdem days, when only Draw & LoBall were allowed (usually player-dealt too!), the local municipalities did have some involvement in regulations.

For example, card rooms were local-options (based on zoning, I think). Gardena had card rooms, and later, small municipalities like Bell Gardens, City of Commerce, etc. but not City of Los Angeles. Gardena card rooms were limited at that time to maximum of 35 tables. (The Rainbow and Gardena clubs were next door to each other, making an unofficial 70-table complex, with an alley splitting the 2 buildings.)

San Diego, during that time, was very restrictive, with a max of 7 tables per card room. And they each had to have a large window in the front of the building, so the police could drive by and look in. (Or so it was explained to me.)

Probably similar stories about central and northern CA clubs too.

Of course, everything changed after the Cabazon (Indian gaming) ruling, and the clubs got bigger, added holdem and other games, etc.