They're drooling in Springfield at the prospect of the greatest expansion in legalized gambling in this state since riverboat casinos were approved 13 years ago. A casino in Chicago. Video poker payouts in bars. Slots at the racetracks. More slots at the casinos. Everything is in play.
There is the very serious matter of whether Gov. Rod Blagojevich believes his campaign promises count for anything. As a candidate, Blagojevich said loudly and consistently that he opposed the expansion of gambling in Illinois. v
He has not yet signed on to any of the smell-the-meat-a-cookin' deals being floated in the state capital, but he hasn't been raising any objections either. There is a way for the state to capture more revenue from gambling, to allow the governor to pay some respect to his own campaign vows, and to avoid having to rename this state the Land of Baccarat.
First, the legislature should approve a publicly owned casino for Chicago. That invests a lot of faith in Mayor Richard Daley to place a casino where it will not dominate the downtown landscape. That also invests a lot of faith in Daley to have an open, competitive bidding process to hire the firm that would manage the casino on the city's behalf. Chicago doesn't need to muster a new army of precinct captain croupiers.
A city-owned casino would capture the bulk of gambling profits for the city and the state. If we're going to make these deals with the devil, then let's maximize the public take. Is this an expansion of gambling? It can be argued that it is not an expansion if the number of gambling locations in the state remains the same.
That should be achieved by immediately halting all negotiations on the transfer of the riverboat casino license now held, however tentatively, by the infamous casino and once destined for the village of Rosemont.
That spectacle has gone on too long. The Illinois Gaming Board denied casino the right to operate because, the gaming board said, some investors had lied to gaming regulators and others had ties to organized crime. The bankrupt casino threatened to tie up its license in litigation for years, so the state has been attempting to reach an agreement that would give the investors their initial investment, in effect paying them to go away.
If it is possible for the consortium to get any seedier, it just did: The Tribune reported this week that federal officials have disclosed to the state that some investors had a secret deal to split an investment in the casino between an investor who has alleged mob ties and a Harwood Heights bank executive.
Enough. The only leverage casino holds, and the only reason for the state to negotiate a settlement, is the threat that the investors and Rosemont would keep the license in litigation so it could not be awarded to a different party. The state has been losing tax revenues while that license has not been used by an operating casino.
What makes that license so precious? It's the state law that limits the number of casino licenses to 10. The legislature, however, can create a new license specifically for Chicago with the understanding that the Illinois Gaming Board will not award the a bankrupt casino license to a new bidder, as is currently envisioned.
The casino will be free to sue--and to explain before a judge those allegations about lying and mob ties. The state, however, will no longer be held hostage by the threat of legal action.
The state will lose the opportunity to put the casino license out for bid, as it has proposed. But the gullywasher of new revenues from a Chicago casino should more than compensate.
The state should kill off the casino license, but not the idea of bidding for casino licenses. As the existing nine licenses come up for renewal, they should be offered in open competition. The existing casinos have no property right to the licenses. They have had ample opportunity to recapture their investments and make a more than handy profit. They would be free to bid for the right to operate a casino along with anyone else who was pre-qualified by the state to make a bid.
There is more at play here. The nine casinos in operation want to increase the number of slots they have. Racetrack owners are asking for the right to install slot machines at the tracks so they can compete with the casinos, and are offering in exchange to give up millions of dollars in tax breaks they were awarded a few years ago.
Let them have it. The track owners have made a reasonable offer. The casinos should be allowed to increase their gambling slots, but only if the state also hikes the tax rate on windfall gaming profits, as Blagojevich has proposed.
But as the casinos become much more lucrative, the case for auctioning their licenses every, say, 10 years becomes imperative. Illinois taxpayers issue these few licenses, and should share more of the immense bounty they yield.
There's one more piece of gambling business on the table in Springfield: the proposal to legalize video poker gambling at hundreds of taverns and restaurants. That, it seems, would threaten to change the scope of legalized gambling in the state. It is a bad idea. Gambling at a limited number of locations is one thing; vastly increasing that number has a cheapening effect and shoves gaming into the faces of those who oppose it.
No one should relish the idea of making Illinois even more dependent on gambling cash. Gambling can be poisonous when an entertainment pleasure turns into an addiction. And no one should be deluded into thinking the regiments of lobbyists pushing for more gaming are moved by their desire to assist Illinois out of its difficult financial situation. That $5 billion state deficit is a $5 billion opportunity to them. The state needs cash. They know where it can be found.
Blagojevich has to play this game with his eyes open. He can't be so consumed by that deficit that he makes a bad deal, that he ignores his own campaign promise, that he breaks faith with his voters. If the tracks and the casinos squeeze him for a sweetheart deal, Blagojevich has to be ready to shut down the process and accept the financial consequences.
The people of Illinois would understand that. What comes from Springfield this year cannot be a repeat of the devious 1999 gambling law that showered the tracks with tax giveaways and protected politically connected people who had made a bad investment, thereby creating the casino/Rosemont fiasco. That legislation helped to tag former Gov. George Ryan as an insider's insider, as everything Blagojevich has professed he is not.
http://www.gamblingmagazine.com/managearticle.asp?c=280&a=6778
There is the very serious matter of whether Gov. Rod Blagojevich believes his campaign promises count for anything. As a candidate, Blagojevich said loudly and consistently that he opposed the expansion of gambling in Illinois. v
He has not yet signed on to any of the smell-the-meat-a-cookin' deals being floated in the state capital, but he hasn't been raising any objections either. There is a way for the state to capture more revenue from gambling, to allow the governor to pay some respect to his own campaign vows, and to avoid having to rename this state the Land of Baccarat.
First, the legislature should approve a publicly owned casino for Chicago. That invests a lot of faith in Mayor Richard Daley to place a casino where it will not dominate the downtown landscape. That also invests a lot of faith in Daley to have an open, competitive bidding process to hire the firm that would manage the casino on the city's behalf. Chicago doesn't need to muster a new army of precinct captain croupiers.
A city-owned casino would capture the bulk of gambling profits for the city and the state. If we're going to make these deals with the devil, then let's maximize the public take. Is this an expansion of gambling? It can be argued that it is not an expansion if the number of gambling locations in the state remains the same.
That should be achieved by immediately halting all negotiations on the transfer of the riverboat casino license now held, however tentatively, by the infamous casino and once destined for the village of Rosemont.
That spectacle has gone on too long. The Illinois Gaming Board denied casino the right to operate because, the gaming board said, some investors had lied to gaming regulators and others had ties to organized crime. The bankrupt casino threatened to tie up its license in litigation for years, so the state has been attempting to reach an agreement that would give the investors their initial investment, in effect paying them to go away.
If it is possible for the consortium to get any seedier, it just did: The Tribune reported this week that federal officials have disclosed to the state that some investors had a secret deal to split an investment in the casino between an investor who has alleged mob ties and a Harwood Heights bank executive.
Enough. The only leverage casino holds, and the only reason for the state to negotiate a settlement, is the threat that the investors and Rosemont would keep the license in litigation so it could not be awarded to a different party. The state has been losing tax revenues while that license has not been used by an operating casino.
What makes that license so precious? It's the state law that limits the number of casino licenses to 10. The legislature, however, can create a new license specifically for Chicago with the understanding that the Illinois Gaming Board will not award the a bankrupt casino license to a new bidder, as is currently envisioned.
The casino will be free to sue--and to explain before a judge those allegations about lying and mob ties. The state, however, will no longer be held hostage by the threat of legal action.
The state will lose the opportunity to put the casino license out for bid, as it has proposed. But the gullywasher of new revenues from a Chicago casino should more than compensate.
The state should kill off the casino license, but not the idea of bidding for casino licenses. As the existing nine licenses come up for renewal, they should be offered in open competition. The existing casinos have no property right to the licenses. They have had ample opportunity to recapture their investments and make a more than handy profit. They would be free to bid for the right to operate a casino along with anyone else who was pre-qualified by the state to make a bid.
There is more at play here. The nine casinos in operation want to increase the number of slots they have. Racetrack owners are asking for the right to install slot machines at the tracks so they can compete with the casinos, and are offering in exchange to give up millions of dollars in tax breaks they were awarded a few years ago.
Let them have it. The track owners have made a reasonable offer. The casinos should be allowed to increase their gambling slots, but only if the state also hikes the tax rate on windfall gaming profits, as Blagojevich has proposed.
But as the casinos become much more lucrative, the case for auctioning their licenses every, say, 10 years becomes imperative. Illinois taxpayers issue these few licenses, and should share more of the immense bounty they yield.
There's one more piece of gambling business on the table in Springfield: the proposal to legalize video poker gambling at hundreds of taverns and restaurants. That, it seems, would threaten to change the scope of legalized gambling in the state. It is a bad idea. Gambling at a limited number of locations is one thing; vastly increasing that number has a cheapening effect and shoves gaming into the faces of those who oppose it.
No one should relish the idea of making Illinois even more dependent on gambling cash. Gambling can be poisonous when an entertainment pleasure turns into an addiction. And no one should be deluded into thinking the regiments of lobbyists pushing for more gaming are moved by their desire to assist Illinois out of its difficult financial situation. That $5 billion state deficit is a $5 billion opportunity to them. The state needs cash. They know where it can be found.
Blagojevich has to play this game with his eyes open. He can't be so consumed by that deficit that he makes a bad deal, that he ignores his own campaign promise, that he breaks faith with his voters. If the tracks and the casinos squeeze him for a sweetheart deal, Blagojevich has to be ready to shut down the process and accept the financial consequences.
The people of Illinois would understand that. What comes from Springfield this year cannot be a repeat of the devious 1999 gambling law that showered the tracks with tax giveaways and protected politically connected people who had made a bad investment, thereby creating the casino/Rosemont fiasco. That legislation helped to tag former Gov. George Ryan as an insider's insider, as everything Blagojevich has professed he is not.
http://www.gamblingmagazine.com/managearticle.asp?c=280&a=6778
