Worth the gamble?

Weighing the odds of a local casino

12/02/2009 10:00 PM

By MARI FAGEL
Medill News Service

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For a city strapped for cash, the prospects of generating up to $1 billion and creating 60,000 new jobs seems like a sure bet. So what is this winning ticket? The nation’s first city-owned casino, said state Rep. Lou Lang, chair of the Gaming Committee in the Illinois House of Representatives.

“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. It’s an idea that was again floated by several aldermen this autumn, as the city stared down a $520 million budget gap.

“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 recently. “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.”

But 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.

“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,’” he said.

Dobmeyer shot down estimates of a $1 billion revenue stream.

“That’s an over-expanded pitch to make it look good,” he said.

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.

Lang came up with estimates of 60,000 new jobs from discussions with economists, labor unions and city officials two year ago. The vast majority of new position, he said, would be permanent, with many in nearby restaurants and hotels.

“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 beside the point. It would be a significant boost for our economy.”

Building a new casino in Chicago would require a deal by legislators in Springfield. In 2007, the state senate passed a bill that would create a land-based casino in Chicago, along with two more riverboat casinos. The bill never came up for a vote in the House. Lang is hoping to renew talks of the casino in the spring session.

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.

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 decline 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. But 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.

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.

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 urged city officials to consider more lease deals, including the lease of Midway airport, before shifting to gambling revenue.

Gilroy, meanwhile, said she will continue to fight to keep gambling out of the city.

“In the beginning, casinos were not to be in large cities,” Gilroy 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.

Lang said the nine Illinois cities that already have riverboat casinos have not seen a spike in crime.

“Every day people gamble, they do it legally and illegally,” he said. “It would be better to capture them legally, pick up the dollar, hire more people, and bring our tourists back to Illinois.”


2 Comments - Add Your Comment



By No to Gambling from South Loop
Posted: 12/07/2009 7:45 AM

Rob, bottom line, gambling is for degenerates. No one wins except for Casinos and their criminal element. You end up with the worst kid of people in all spectrums, and it invites all other seedy elements vices from petty theft, organized crime (in our case that means cook county and chicago politicians), prostitution, etc. If we have to rely in gambling for a savior then our politicians continue to do something wrong.


By Rob from West Loop
Posted: 12/03/2009 4:15 PM

To all these anti-gambling groups - why not make the same argument about bars? Some people get too drunk, don't they? On the balance, I think gambling is another form of entertainment for most people. It would bring jobs and money to the city that is otherwise lost to Indiana.