Wednesday, January 05, 2011

New version of gaming expansion headed to House floor

By Jamey Dunn

The Illinois House's version of a whopping gambling expansion measure passed through a legislative committee today.

The Senate Bill 737 calls for a casino owned by the city of Chicago. The city would choose who would run the daily operations. New casinos would also be slated for construction in Park City, Rockford, Danville and an unnamed location in the southern suburbs of Chicago. The Illinois Gaming Board would chose the final location through a bidding process.

The measure also allows slot machines and video poker at horse racing tracks. Unlike the Senate version of the bill, it also allows slots at airports beyond security checkpoints. Sponsor Lou Lang, a Skokie Democrat, said the slots would target travelers with time to kill, and locating them past security would prevent airports from becoming gambling destinations.

Lang said the measure would bring in $1.3 billion in upfront licensing fees — three quarters of which would go to pay down the state’s overdue bills. The other quarter would be spent on capital construction projects. The expansion would also bring in $1 billion a year in revenue. He added that it would also create jobs, bring new revenue to economically depressed areas and help to grow agribusiness in Illinois by encouraging the horse racing and horse breeding industries.

Lang said he is concerned that if the gambling expansion passes, the state gaming board might skip over the stalled implementation of video gaming in bars, restaurants and truck stops throughout the state and begin licensing new casinos. The capital bill is supposed to be funded, in part, with revenues brought in from expanding video poker to those new locations. The bill now calls for 2,000 operating video gaming terminals in Illinois — 1,000 in Chicago and the collar counties and 1,000 throughout the rest of the state — before the gaming board can authorize any new casino licenses, existing casino expansions or slots at racetracks.

Lang pulled the bill from a committee hearing Monday, saying it needed work and that he hoped to make it more amenable to casino owners.

The new “sweeteners” include a chance to relocate casinos, various tax cuts and a $200 million tax credit for renovations.

However, Lang correctly predicted earlier this week that the new version of the bill would not get backing from casino owners, who say the expansion would over-saturate Illinois’ gambling market.

Tom Swoik, executive director of the Illinois Casino Gaming Association, said casinos are already facing dropping profits, and the expansion would likely lead to layoffs. He added that Lang is overestimating the potential revenue that could come from luring gamblers across state lines to new facilities.

“The revenue that this bill would generate is based on the assumption that the new northern venues would bring back business from Indiana. … Almost every person gambling in the state of Indiana is going to have to come over to the state of Illinois,” Swoik said.

Robert Molaro, a former Illinois House member and current lobbyist for the horse racing industry, said horse tracks need the money from slots to offer bigger purses for races. He said other states are offering larger prizes, and horse breeders are leaving Illinois. “We have no choice. This is all about our survival.”

Anti-gambling groups say the expansion will create many more gambling addicts throughout Illinois and cost the state millions on social services and addiction treatment as a result. “People who have never gambled before will start to gamble when it’s in their community, when it’s accessible,” said Anita Bedell president of the Illinois Church Action on Alcohol and Addiction Problems.

Lang said he plans to call the bill on the House floor as soon as tomorrow.


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