News Releases - Business, Economy & Finance
Written by Linda K. Rutten   
Monday, 15 November 2010 10:09

SPRINGFIELD -- The mayors of Illinois’ nine riverfront communities with gaming casinos are asking state lawmakers in Springfield to reject proposed slot machines at Illinois' horse tracks. The mayors agree that these riverfront communities are already struggling and can't afford to lose more jobs in such a poor economic climate.

The mayors of Aurora, Elgin, Joliet, Peoria, Alton, East St. Louis, Des Plaines, Rock Island and Metropolis said their towns have formed a new coalition called Cities Against Slots at the Tracks (CAST). Representatives from the coalition will participate in a drive-down to Springfield on November 16 – the first day of the General Assembly fall veto session -- to protest the legislation. The Mayor of Peoria, which receives a share of local revenue from the nearby Par-a-Dice Casino, has signed on and the organization expects other groups to support the coalition as well.

One of the slots at the racetracks proposals would allow 6,300 slot machines at Illinois' six racetracks, and would create five additional casino licenses --- one license each for Chicago, Lake County, Danville, Ford Heights and Rockford. The millionaire owner of Arlington Racetrack wants slot machines for the track when Arlington Heights has a 7 percent unemployment rate, one of the lowest in the state. The nine riverboat cities have unemployment rates ranging from 8.9 percent to 17.2 percent as of September 2010.

"The intent of the original Illinois Riverboat Gambling Act of 1990 was to create jobs in older Illinois River communities with a need for economic development projects,” said Aurora Mayor Thomas Weisner, whose city has the Hollywood Casino. “We should continue to focus on the original intent of the act, which is providing jobs and economic development for river cities, not for millionaire track owners and well to do communities,” said Weisner.

“Elgin's riverboat, the Grand Victoria, will suffer terribly with slots at nearby horse tracks,” said Mayor Ed Schock.  “This legislation further divides the state’s pool of gambling revenues and shortchanges the same river communities that the original riverboat gambling law was meant to support,” Schock said.

Joliet Mayor Art Schultz has two riverboat casinos in his city. “We are working with riverboat owners to examine the potential impact of slots at the tracks. We believe that this legislation will be extremely harmful to Joliet, Will County and surrounding communities by decreasing our riverboat revenues,” Mayor Schultz said.

According to a report from the General Assembly’s Commission on Government Forecasting and Accountability, the riverboat gambling industry is already suffering in Illinois from many factors.

• In Fiscal Year (FY) 2010, the State’s share of horse racing, lottery, and riverboat revenue reached $1.019 billion, a 4.5% decline from FY 2009 levels. This is the lowest combined total for these revenue sources since FY 2001. The $48 million falloff in overall gaming receipts was almost entirely due to a decline in riverboat transfers to the Education Assistance Fund as lottery transfers and horse racing revenues held flat in FY 2010.

• In FY 2010, lottery transfers comprised 61.7% of total gaming revenues, whereas riverboat transfers comprised 37.6%, and horse racing comprised of 0.7%. Overall gaming per-capita spending declined 3.0% in FY 2010 to $188. This was the third consecutive year of a decline in overall per-capita spending after three consecutive years of increases. 

• Statewide adjusted gross receipts (AGR) for Illinois riverboats in FY 2010 were down 5.0% from FY 2009 levels while admissions were up slightly at 0.6%. This is the third consecutive year of declines in total AGR. State revenues from riverboat gambling totaled $398.4 million, which was a 10.3% decline from FY 2009 levels and was the lowest amount generated since FY 2000. 

• Several factors have contributed to the dramatic downturn in riverboat figures over the last three fiscal years. These factors include the struggling economy, increased competition from other states, and the effects of the graduated tax structure. However, the numbers continue to suggest that the biggest contributor to the drop in Illinois casino revenues is the indoor smoking ban. Since the indoor smoking ban began in January 2008, adjusted gross receipts for Illinois riverboats have fallen a combined 28.0% from pre-smoking ban levels.

• From a regional standpoint, when comparing CY 2007 (pre-smoking ban) vs. CY 2009, AGR for the Chicago area riverboats have dropped 32.8% since the indoor smoking ban began, while the receipts for Indiana’s four closest riverboats in the Chicago area have only fallen 0.4%. Similarly, Illinois’ AGR figures are down 26.3% for Illinois’ two St. Louis area riverboats between CY 2007 and CY 2009, while the AGR of Missouri’s St. Louis region riverboats are up 19.5% (although part of this increase is due to a new riverboat in St. Louis). 

• Using FY 2010 adjusted gross receipts as a guideline, Illinois made up 36.3% of total receipts in the Quad City region (compared to Iowa’s 63.7%), 20.6% of total receipts in the St. Louis region (compared to Missouri’s 79.4%), and 46.7% of total receipts in the Chicago region (compared to Indiana’s 53.3%).

• Riverboats created $84.6 million in local revenue for governments in FY2010, down from $116.1 million in FY 2007. 

East St. Louis Mayor Alvin Parks said his city is already suffering from a massive new casino in St. Louis, Missouri, a city with no smoking ban. “It’s hard enough to compete with Missouri’s new sparkling Lumiere Casino but East St. Louis shouldn’t also have to compete with slot machines at nearby Fairmount Park,” Parks said.

Des Plaines Mayor Marty Moylan, whose new casino is scheduled to open in November 2011, said the legislation will hurt Des Plaines and coalition of mayors will work tirelessly to defeat slots at the tracks legislation. 

The casino gaming industry provides nearly 7,543 jobs, and every year injects more than $1 billion into the state's economy. In 2008, we spent nearly $145.5 million with local vendors and suppliers and stimulate tourism, attracting numerous of out-of-state visitors a year to our communities.

“If we are talking about saving jobs in Illinois, let’s protect the employment of more than 7,500 people already working at our riverboat casinos in the state,” Moylan said.



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