CHICAGO – A proposal for a state-owned Chicago casino won praise Wednesday from business groups and a warmer reception from a state regulatory board than past attempts to expand gambling, but the plan also drew criticism from downstate officials and the horse racing industry, who said it would cheat them out of needed revenues and jobs.
The hearing in Chicago, which wasn’t heated like public exchanges in other parts of Illinois, was the latest attempt to bolster gambling, but questions were also raised about support for the legislation in an election year where other major fiscal issues are pending. Previous bills approved by legislators were twice rejected by Gov. Pat Quinn largely over ethical concerns about corruption, and last year’s bill calling for five casinos fizzled out after the Illinois Gaming Board scrutinized plans that would have allowed Chicago to have authority over a casino.
State Rep. Bob Rita, a Blue Island Democrat sponsoring the plans, said he wanted to gauge interest in a Chicago-only plan and give lawmakers options.
Two proposals are on the table: One adds five casinos, including in Chicago, plus slots at racetracks. The other calls for a mega-casino in Chicago. In both plans, the Chicago casino would be state run, which Rita said was in response to past criticism.
Though neither Quinn nor Chicago Mayor Rahm Emanuel have weighed in recently, the board that regulates Illinois’ 10 existing casinos highlighted the changes.
“There are certainly improvements,” gaming board attorney Caleb Melamed told lawmakers. “This is a significantly different piece of legislation than previous years.”
He voiced other concerns about the potential of saturating the market with other Chicago area casinos. He also questioned a state-run casino, a model that’s unusual among other states. The Chicago Crime Commission objected to the structure, calling for an operator-owned model like other casinos and more protections against corruption. Chicago area pastors and anti-gambling groups also warned lawmakers of possible social costs on either plan, such as more people hooked on gambling.
“Casino gambling is really nothing more than an increased tax on those who can’t afford it,” said Matt Fitzgerald, senior pastor at St. Pauls United Church of Christ in Chicago.
Noticeably absent from Wednesday’s hearing were Chicago city officials, even while chamber of commerce groups said a downtown Chicago casino – in either plan – would create jobs and benefit the economy with estimated revenues between $450 million to $950 million. The Chicagoland Chamber of Commerce and urban planners envisioned a Chicago casino as a draw for tourists and locals, with shopping and live shows. They said possible locations included the Congress Plaza Hotel, the top floors of a downtown Macy’s department store or the James R. Thompson Center, which a state building.
“Chicago is an incredible prize for the gaming industry,” said Kim Goluska, president of Chicago Consultants Studio Inc. “The revenues are going to be huge no matter what they are.”
Still, Emanuel spokeswoman Sarah Hamilton said the mayor wouldn’t address expanded gambling until the city solved its pension problem. State lawmakers have approved a partial fix to Chicago’s pension problem, but Quinn hasn’t indicated if he’ll sign it. Quinn’s spokeswoman Brooke Anderson said the Chicago Democrat hadn’t seen the two gambling expansion plans.
Rita said he hadn’t spoken to either Quinn or Emanuel about the proposals, but wanted to call his legislation for a vote before the end of May. He’s said that the political climate in Springfield could be more favorable than last year when lawmakers were considering plans to address the pension system, which is the worst-funded in the nation. Quinn has since signed a pension law. Lawmakers are also looking for additional revenue sources in this election year as the temporary income tax increase rolls back next year and creates the potential for major budget cuts.
One of his current plans calls for a Chicago casino with up to 10,000 terminals that’ll share revenues; Half would go to Chicago and the other half statewide for education and capital construction spending. The other plan would call for a 4,000 to 6,000-spot Chicago casino and smaller, 1,200-position ones in a suburb south of Chicago and the counties of Lake, Winnebago and Vermilion. It would also allow for slot machines at most horse racetracks. The second plan would also allow for revenue sharing.
The idea to separate out the Chicago casino has already drawn opposition from the Illinois’ horse racing industry and mayors elsewhere, particularly in economically-depressed areas. They’ve argued for job creation with the five-casino proposal. The Illinois Casino Gaming Association, which represents most of the state’s casinos, said it opposed both plans citing revenue drops over the years and market saturation.