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* Tribune editorial…
We’ve long contended that locating a casino in Chicago makes sense. Legal gambling tends to generate lots of tax revenue, which the city and state need. But the way Gov. J.B. Pritzker and the General Assembly have gone about structuring the expansion of casino gambling into Chicago is all wrong. They’ve set up this project to fail and likely have to rewrite their legislation.
A state-hired consultant from Las Vegas released a feasibility study Tuesday — one required by the gambling expansion law — that makes a very good case … for casino operators to avoid coming to Chicago. Taxes from gambling revenue and fees to be gobbled up by the city and state are so onerous, the study concludes, that the casino would generate very little profit, if any.
There’s actually a scenario in which, under the current legislation, the combination of taxes, fees and operating expenses “could exceed casino revenue,” the study warns.
Think about that. Illinois lawmakers, salivating over the prospect of easy money from gambling taxes, write and pass a law to allow a casino in Chicago. But they’re so greedy that the entire enterprise becomes financially untenable before it starts. Lenders wouldn’t want to finance it, and gambling companies wouldn’t want to run it.
The Tribune isn’t alone. There was plenty of hand-wringing in Chicago about the consultant’s report.
And for good reason. The consultant submitted the only valid bid because the law mandated a too-quick process. The Illinois Gaming Board, which is already stretched to the limit with other casino expansions and sports betting implementation, has 90 days to evaluate the study and make recommendations to the General Assembly about what changes need to be made, but the fall veto session starts in just 75 days.
* Not to mention that one of the most influential Illinois legislators on this topic is not yet convinced any changes need to be made…
“Call me skeptical,” said state Sen. Terry Link, D-Waukegan, the chief sponsor of the bill authorizing the Chicago casino, as well as new gambling outlets in his home Lake County and other locales around the state. “They’ll have to do a lot more convincing to get me” to agree to cut the tax rates.
“All of us would like the largest profit margin we can,” added Link. Whoever builds the casino “is still going to make a lot of money.”
So now, we wait.
posted by Rich Miller
Wednesday, Aug 14, 19 @ 9:58 am
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How does this impact the capital bill? I thought the state needed some of that money for capital projects, but I could be wrong.
Comment by Three Dimensional Checkers Wednesday, Aug 14, 19 @ 10:03 am
As someone who would love to see a casino/hotel go in the Thompson Center, if the city/state cooperated to make that happen, could -that- be profitable at the current tax rate? I don’t know how the numbers would go, I just don’t understand why, if the idea is to get revenue, you throw away the most attractive location (downtown) - even McCormick Place is a trip that will discourage many.
Comment by lake county democrat Wednesday, Aug 14, 19 @ 10:05 am
The super fast procurement tells me that this bid was cooked from the beginning. The gambling lobbyists wrote the bill so that only this consultant could be hired and — SHOCKINGLY — that consultant said there wasn’t enough profit for the lobbyists’ clients.
Comment by Just Me 2 Wednesday, Aug 14, 19 @ 10:24 am
If they actually intend to build this thing on either the south or west side, kiss the potential success of this casino goodbye. That original site list had to be a ploy of some kind, right?
Comment by BigDoggie Wednesday, Aug 14, 19 @ 12:56 pm
Mark Brown really nailed this in his Sun-Times column. Due to the change in the mayoral administration, the city of Chicago really didn’t have their act together as the gaming legislation was put together and passed. This study was a way for them to buy time and come back with changes on a trailer bill during Veto Session. They want city ownership, which I don’t think they’ll ever get. Joint city-state ownership is a possibility, though.
Comment by Roman Wednesday, Aug 14, 19 @ 1:06 pm
Would love to see a racial equity analysis of the Chicago casino idea before it’s assumed this is a net positive gain for city residents. Somebody needs to lay out the plan on how this won’t turn out to be a regressive tax.
Comment by Veil of Ignorance Wednesday, Aug 14, 19 @ 3:00 pm
I have never seen colored people gambling. - Mama
You had rose colored glasses on…”The Colored” were camouflaged.
By the way…it’s almost 2020…perhaps it’s time for a vision test?
Comment by Dotnonymous Wednesday, Aug 14, 19 @ 4:42 pm
I agree a 100% with Sen Link
Comment by Been There Wednesday, Aug 14, 19 @ 6:07 pm