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?

“Armchair sociology” accusation in DraftKings, FanDuel case in New York

The recent case in New York involving the Attorney General and two fantasy sports sites included the accusation of “armchair sociology” this week:

“Rather than identify the concrete and immediate harms necessary to support a preliminary injunction, the NYAG instead resorts to smear tactics and speculation stretching to tie DFS contests to everything from child-abuse to over-eating, among other things,” reads DraftKing’s motion.

“The Attorney General’s armchair sociology would not pass muster on a daytime talk show,” continues the filing, which urges a panel of appellate judges to allow the online companies to continue operating in New York while the case works its way through the courts.

Schneiderman first filed suit in November, and was granted a temporary injunction on Dec. 11 to stop the sports giants from operating in New York. But that decision wasoverturned just hours later, and now the companies are operating under an emergency stay as the Appellate Division decides their fate in an expedited ruling.

Armchair sociology is a derogatory term here implying a false understanding of how people and/or society work. Additionally, there is a reference to daytime talk shows with the idea that the explanations given there for human behavior don’t match reality. Perhaps DraftKings and FanDuel would prefer more rigorous social scientific examinations of their practices and users? It would be interesting to see whether the “armchair sociology” claim has any influence or it is just PR posturing.

Just out of curiosity, I checked where I have seen the term armchair sociology before: see this earlier post where George Will accuses liberals of wrong ideas about how society works. There, the term is used to link sociology and liberal ideas, a thought that many conservatives may share.

Sociology of gambling laboratory in Las Vegas

While Chicago might still be the urban laboratory of choice for some sociologists, a sociologist at UNLV talks about Las Vegas as a fantastic laboratory for studying human motivations and gambling:

We live in the largest gambling laboratory in the world. A sociologist who studies gambling in Las Vegas is probably like being a physicist and living in a vacuum. I tell all my students to sit on a bench and watch all the humanity. That’s why market research firms like to come to Las Vegas. In an hour and a half, they can meet 40 people from 40 countries and states. Humanity comes here…

You’re struck by the similarities and differences in various markets. Las Vegas is a sea of slot machines with a smattering of table games. Macau is a sea of table games with a smattering of slot machines. As a social scientist, you watch the different behaviors. In Macau, no one is consuming alcohol. There is always a calculus going on, where gamblers are demonstrating math skills while hoping to be smiled upon by the gods of chance. What’s fascinating is to contrast the Chinese gambler against the American or European gambler.Question: You recently authored a report that said Las Vegas could learn much from Houston. How?

Answer: Houston suffered a downturn when its main economy, oil production, moved overseas and became a global industry. The slump ended when Houston began exporting its intellectual capital.

Las Vegas could do the same thing as gaming becomes more international. In some ways, our companies are already doing that. Las Vegas can become the global command center of the international gaming industry. One way you do that is education. Of course, I’m completely biased but the gaming institute can play a leading role in this transformation.

I bet you could use gambling research in a lot of examples within a research methods class.

I’m intrigued by a couple of ideas mentioned above:

1. There are different cultural approaches to gambling. I should have known this but I don’t think I’ve ever thought about it before. It would be interesting to hear if Americans live up to typical stereotypes (confident, brash, etc.).

2. I wonder if social scientists would be allowed by casinos to conduct academic studies with gamblers/customers. I’m guessing this is likely off-limits unless the work could be beneficial to the casinos. If there are a lot of people already in Las Vegas who want to engage in gambling, why not let them do it in the context of monitored academic research?

3. What holds Las Vegas back from becoming a finance center? Gaming requires large flows of capital from both companies and visitors. To truly become a world-class city, this would seem to be a way the city could go by working with the money in innovative ways.

This reminds me of comments from sociologists after the American Sociological Association meetings were held there last August. Do most sociologists think the city is simply an oddity or are there real things that could be learned from the city (Sun Belt city, center of the gaming industry, ecological concerns, many foreclosures) and applied elsewhere?