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Mari Fagel/MEDILL
Chicagoans weigh the odds of a local casino
Is a Chicago casino worth the gamble?
by Mari Fagel
Nov 05, 2009
Quick facts about Illinois gambling
- In 2008, Illinois riverboat casinos brought in $566,743,917 in tax revenue
- In 2008, there were 14,637,054 visits to Illinois riverboat casinos
- Each person spent on average $107 gambling
- In 2008, casinos provided more than $284 million in annual payroll and benefits to nearly 7,500 employees.
- Since 1990, Illinois riverboat casinos have generated more than $8.25 billion in tax revenues
- As of July 2008, 4,090 people in Illinois have enrolled in the Statewide Self-Exclusion Program for Problem Gamblers.
- The City of Chicago had the most residents enroll with 279 people
Source: Illinois Gaming Board and Illinois Gaming Commission
“It would be a win-win,” Lang (D-Skokie) said. “It would put people to work, fill up hotels and restaurants. It has a ripple effect that will only be beneficial.”
Lang has worked to bring a casino to Chicago since the early ‘90s. And now, faced with the challenge of closing a $520 million budget gap, Chicago aldermen are renewing talks of a Windy City casino.
“I don’t know why we are not looking at serious thoughts of putting a casino in Chicago,” Ald. Richard Mell (D-33rd) said in a City Council budget hearing last week. “People are getting on buses in my neighborhood and being driven to Indiana to lose their money. If they are going to do it, they might as well do it here.”
However, opponents say the government should not be in the business of encouraging people to lose their money.
“This isn’t an issue of raising revenue for the city,” said Doug Dobmeyer, spokesman for the Task Force to Oppose Gambling in Chicago. “It’s an issue of decreasing the revenue for people who live in the city.”
Dobmeyer said offering more gambling options during a recession will only hurt residents.
“If you offer the brass ring to people, too many of them will try to grab it,” Dobmeyer said.
“I don’t think that it makes sense in bad economic times to go to people and say we want you to spend more in casinos when that money would be better spent on education, food and mortgage payments.”
$1 billion: a safe bet?
Dobmeyer also shoots down estimates of a $1 billion revenue stream.
“That’s an over-expanded pitch to make it look good.”
Cory Aronovitz, founder of the Casino Law Group, agreed that $1 billion is an aggressive number. He said $500 million dollars is a more realistic estimate, with half of that revenue going to the city and the rest to the state.
In comparison, Indiana’s 13 casinos brought in nearly $876 million dollars in tax revenue between June 2008 and 2009. Illinois’ nine riverboat casinos brought in nearly $567 million dollars in 2008.
While Lang said there is no way of knowing what numbers to expect, he said the fact that a land-based casino would help the economy is undeniable.
“It would put tons of people to work and raise a heck of a lot of money,” Lang said. “Whether it’s a billion or 800 million is besides the point. It would be a significant boost for our economy.”
Lang came up with estimates of 60,000 new jobs from discussions with economists, labor unions and city officials two year ago.
“Some of these jobs would be only during the building phase,” Lang said. “But the vast majority would be permanent jobs, not only in the casino, but also in restaurants and hotels in the surrounding area to where this thing would be sited.”
Will history repeat itself?
In 2007, the state Senate passed a bill that would create a land-based casino in Chicago, along with two more riverboat casinos. However, the bill never came up for a vote in the House.
In order for a casino to be built in Chicago, both chambers of the state legislature would have to approve it. Lang is hoping to renew talks of the casino in the spring session.
However, anti-gambling activist Kathy Gilroy said the bill is sure to meet the same fate it has in the past.
“It’s insane to do the same thing over and over again and expect a different result,” said Gilroy. “That’s the definition of insanity.”
Yet, there is one key difference between 2007 and now: the recession.
According to Mayor Richard M. Daley, city revenues from income, sales and real estate taxes have dropped 31 percent since 2007. He said this tremendous drop in revenue led to the massive budget deficit. In order to close the budget gap, Daley proposed using $370 million from the 75-year $1 billion lease of the city’s parking meters.
Weighing the odds
The mayor’s controversial decision to dip into the city’s rainy day fund has left several aldermen proposing different solutions.
For Mell, a Chicago casino is the most obvious solution. In last week’s City Council meeting, he recounted a recent trip to an Indiana casino where he found that 86 percent of the license plates in the parking lot were from Illinois.
“People are driving 100 miles just to gamble, yet we’re still sitting here saying, ‘I don’t know.’”
Aronovitz said a Chicago casino is a much more reliable revenue source than borrowing money from a one-time fund.
“Having a casino that creates continuous revenue and incremental growth is a tremendous option that the city has available for its disposal,” Aronovitz said.
However, Dobmeyer said these rainy day funds are a much better option than a casino.
“If they can make the assets work for them, that’s good,” Dobmeyer said. “That won’t cause Joe Blow in Little Village to go out and spend $100 he doesn’t have on slot machines.”
He urges city officials to consider more lease deals, including the lease of Midway airport, before relying on gambling revenue.
“It’s not out of the mainstream of thinking to take your assets and make them work for you.”
The convention factor
A local casino is the key to attracting more tourists and conventions to the Windy City, according to Lang.
“For many years, Chicago was the No. 1 site for conventions,” Lang said. “While we still do well, we are no longer No. 1. Some of our conventions and trade shows have left, and I’m not saying gaming is the only thing that will bring them back, but surely something on that grand scale would turn that around.”
A casino could also offset the effects of proposed budget cuts to the Chicago Convention and Tourism Bureau. Under the mayor’s 2010 budget proposal, the bureau stands to lose as much as $1.5 million, or 10.6 percent of its budget.
A local casino could put Chicago back on the map as the capital of conventions, said Jerry Roper, president of the Chicagoland Chamber of Commerce.
“There is no doubt that it will attract more conventions because there will be increased entertainment in our city,” Roper said. “That in turn, will bring about increased retail and increased diners to our restaurants.”
However, Gilroy doubts one casino will make that much of a difference.
“Talk about it bringing conventions is a laugh,” Gilroy said. “Conventions don’t come to a city because they have one casino. They go to Las Vegas for an experience, it wouldn’t be that experience in Chicago.”
What happens in Vegas…
Gilroy said she will continue to fight to keep that “experience” in Las Vegas, and far from her backyard.
“In the beginning, casinos were not to be in large cities,” Gilroy, who is going to a Stop Predatory Gambling convention next week, said. “That’s why it worked when it was in Las Vegas, because it was a destination, people had to go there and then leave. You don’t want it right next to where people live.”
She said a casino would bring with it a host of social problems.
“Some people say, ‘what’s the difference between a dollar gambled and a dollar spent at a movie theater?’ But people don’t steal to buy a movie ticket, they don’t commit suicide in the parking lot.”
Lang said the nine Illinois cities that already have riverboat casinos have not seen a spike in crime, so why should we expect an increase here?
“People are filled with fear, but the facts don’t bear out those fears,” Lang said. “I don’t understand the bury the head in the sand approach -- every day people gamble, they do it legally and illegally. It would be better to capture them legally, pick up the dollar, hire more people, and bring our tourists back to Illinois.”
