Illinois casino expansion aims to break budget deadlock

Casino Review - Illinois

A new bill in Illinois seeks to authorise six casino premises and grow gaming by up to 20 percent, with legislators seeking revenue for the cashstrapped state that has been without a spending plan for two years.


llinois legislators have proposed an expansion of casino gambling in the Prairie State that will see the launch of new gambling establishments in six locations.

The proposal is aimed at boosting the cashstrapped state’s revenue as well as ending the two-year period during which Illinois was lacking an annual spending plan.

The expansion is part of the statewide “Grand Bargain” intended to break the budget deadlock, and although the plan has fallen upon rocky times the casino expansion has been endorsed by the state’s Senate. The acceptance of the gaming proposals would result in the sinking of so called “river gambling” in the state, as landbased licenses would be granted for Chicago, Rockford, Danville, Williamson County, and in an undetermined location in Lake County.

Landbased casinos were prohibited from operating in the Windy City because of heavy competition with horse racing in the region but supporters of the gambling expansion proposal hope it would prevent local players from frequenting Indiana to wager and thus, boosting the local economy.

An analysis of the expansion, sponsored by Democratic senator Terry Link, indicated that an accepted proposal would collect almost $1bn in set-up fees alone for the state. Such fees for Chicago and its south suburban areas would range between $30,000 and $100,000 per slot machine or seat at blackjack tables.

Under the bill, the tax rate for slot machine revenue would be 20 percent, while table games would be taxed at 16 percent. Analysis from the Commission on Government Forecasting and Accountability indicated that Illinois could grow its gambling market by about $550m if the legislation is enacted, all on top of the state’s preexisting $2.5bn gaming revenue.

The proposal could provide a much needed shot in the arm for a gambling industry that has seen better days. Figures from the Illinois Gaming Board’s 2016 annual report show gross revenues have declined in recent years. Receipts totalled $1.41bn in 2016, down more than a half-billion dollars from the 2007 peak of $1.98bn.

Meanwhile, revenue from storefront video gambling in bars and other locations is increasing in Illinois, adding to the erosion of casino revenues. In 2016, 24,840 machines at 5,726 locations had $14bn played; that’s up from $11.38bn in 2015.

A key tenet of the bill is regulation and preventing corruption, with proponents of it saying that the authorisation of casino gambling in Chicago will enhance investment, development, and tourism in Illinois, it is recognized that it will do so successfully only if public confidence and trust in the credibility and integrity of the gambling operations and the regulatory process is maintained.

In addition, if passed the legislation would generate both construction jobs and permanent casino jobs in each of the communities, along with trickle-down effects. “The doors would be open for conventions, which is something that southern Illinois does not have,” said Republican Sen.

Dale Fowler of Harrisburg, whose district includes Williamson County. It is noted in the act that all provisions “Are designed to allow the Illinois Gaming Board to strictly regulate the facilities, persons, associations, and practices related to gambling operations pursuant to the police powers of the State, including comprehensive law enforcement supervision. Consistent with the Gaming Board’s authority, the Gaming Board alone shall regulate any Chicago casino, just as it now regulates every other casino in Illinois.”

As part of the bill, existing land based gambling premises would be allowed to expand operations by 400 seats, and in addition the airports and four hours racing tracks in Chicago would be permitted to offer slot machines on-site.