Video gambling in Illinois trickles money into local coffers

As video gambling has spread across Illinois, who is making money? A little is going to local governments:

Video gaming revenues, after payouts, are taxed at a flat 30 percent rate. Five-sixths of those tax proceeds go to the state and one-sixth to the local government. Remaining revenues — the other 70 percent — go to the establishments, like Lucky Jack’s, and the video terminal operators.In the year ended in September, almost $12.7 million was played at Lucky Jack’s in Waukegan, and $11.7 million was won by gamblers, according to Illinois Gaming Board statistics. That means the terminals netted just shy of $1 million. Of that, more than $246,000 went to the state and about $49,000 to Waukegan. The rest is split between Lucky Jack’s and Gold Rush Gaming, its terminal operator…

In Waukegan, a resolution passed in 2014 earmarked virtually all of its cut of gambling revenues for the underfunded pension plans of its police officers and firefighters. Were it not for video gambling, the resolution said, taxpayers might have to cover the shortfall.

Not every municipality, however, is looking at the terminals as a cash cow. Chicago, Naperville and Arlington Heights don’t allow them…

The cities with the most video gambling terminals are Springfield, Rockford and Decatur. The counties with the most machines are Cook, Lake and Winnebago counties, the commission report said.

In an era when many municipalities are looking for every cent they can, video gambling can provide some revenue. But, many communities likely consider a fraught deal: it may start a trickle of money but it also projects a particular image. One anecdote in the article suggested people pull up to a local establishment with video gambling and idle as they wait from some signal from inside that a spot at one of the machines is open. Is this what a wealthier community wants to be known for? Like tattoo parlors and bars, many places wouldn’t want to avoid the stigma of gambling establishments.

It would also be interesting to know whether these more local operations siphon money from casinos which could generate significant revenues for local governments. In other words, if every gas station or local eatery had video gambling, would there be enough money to go around? Do people simply go to the places that are most convenient to them or would they cluster in places with either better or more video gambling options?

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