Thursday, October 1, 2009

Video gaming bans to come up at this morning's Cook County Finance Committee meeting

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Casino lobbyists are pushing to kill video gaming law
By Ray Hanania

The casino lobby is pushing hard to kill legislation adopted by the Illinois General Assembly to permit video gambling in liquor-licensed establishments to generate revenue to fund Gov. Pat Quinn’s $31 million capital improvement plan.

And they have taken their battle to the Cook County Board where they hope to kill the legislation and decapitate the statewide plan through two ordinances expected to be discussed at today’s (Thursday’s) meeting, according to Finance Committee Chairman John Daley.

Projected revenue from local businesses who might offer video gaming devices in Cook County alone would account for nearly 40 percent of the money needed to fund the state plan. Banning it in Cook County could decapitate the Quinn plan and force the governor to find another funding mechanism.

But some are wondering why Cook County is getting involved and denying suburban communities like Orland Park and others to decide for themselves to opt out of the law using Home Rule powers.

Two ordinances banning video gambling devices in Cook County have been discussed for a long time but were finally introduced simultaneously on September 1 by Commissioners Greg Goslin (14th) and Bridget Gainer (10th). But the ordinances also would deny unincorporated areas of the county located only in the outlying suburbs to place video gaming and benefit from the expected profits. Goslin’s intent is to amend the power to ban to local townships.

Daley said several commissioners have bailed as co-sponsors after the benefits to local communities has become better understood and defined. The Illinois Gaming Board headed by Judge Aaron Jaffe is still formulating the final rules and regulations. Daley said he was sensing there are “some issues” with both bills and could not predict their futures.

The casino industry doesn’t want video gaming because they fear that the new legislation will cut into their own revenues, which have plummeted in today’s tough economy. And it is all about the money.

The casino industry opposition, though, is illogical and selfish.

Proponents argue there are an estimated 60,000 illegal video gaming devices already operating in Illinois. The new legislation will permit the licensing of up to 75,000 video gaming devices and would undermine the illegal operations. It would also put the revenues in the state coffers to fund Quinn’s capital improvement budget, but also give local municipalities the ability to impose their own licensing requirements to generate additional revenues for their local needs.

The Quinn legislation does not require local communities to set aside funds to manage the oversight of the video gaming devices. The state would be responsible for enforcement, revenue collections and management of the legislation.

Municipal attorney Michael Del Galdo, principal of Del Galdo Law Group LLC, said most suburban communities with Home Rule powers would also generate new revenues that could be as much as $500,000 a year or more that could off-set sagging tax bases in today’s economic depression.

“There are absolutely no regulatory responsibilities on local governments which means it is not an unfunded mandate. … no obligation to enforce the legislation. … The state maintains jurisdiction for enforcement. The state would need to presumably get inspectors or create a department to manage these machines,” Del Galdo explained.

During an interview on Radio Chicagoland Wednesday (podcast at, Del Galdo predicted that based on projections by regional municipal leagues, each machine can generate as much as $2,250 per year per municipality in local revenues. Each establishment could have up to five machines and many communities have as many as 15 potential qualified locations. And, suburban communities could also impose a licensing fee on the gaming devices, which usually run as much as $5,000 a year per machine. With 5 machines in 15 establishments, that could be $350,000 a year in added revenues.

But the casinos in Illinois covet every penny, especially in today’s tough economy. And they have loads of money to spread around funding an army of lobbyists to develop strategies to kill the bill.

If the casinos can get Cook County to ban the video gaming devices and prevent retail businesses from offering video games, it would carve a huge hole in Quinn’s revenue projections. Cook County would account for almost 40 percent of the establishments that would likely offer the video gaming and probably represents 50 percent of the anticipated revenues, compared to the remainder of the state.

The bottom line on the county effort to ban video gambling machines is that it denies local communities the right to decide their own future, and more importantly, denies those communities the ability to profit from the gaming devices through licensing. As for lost revenue, the video gaming law undermines the now illegal underground video gaming industry, taking money out of the pockets of illegal video gaming operators and putting it in the hands of the taxpayers.

It makes no sense for the Cook County Board to stick its nose into the issue. Cook County as a government agency would not receive any money from the video gaming machines, so why are they wasting their time legislating its ban?

Unless they are doing it to help the casinos.

Let the communities decide what they want, and let commissioners who represent unincorporated areas speak for those areas.

Gainer and Goslin did not reply to questions by deadline but I will follow up on the topic on the Suburban Blog (


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