Elburn officials ponder pros, cons of video gambling

By on August 14, 2009

by Martha Quetsch
ELBURN—Elburn officials wonder if newly legalized video gambling is what they want for the village.

Video gambling in establishments with liquor licenses, allowed under an act Gov. Patrick Quinn signed into law July 13, will generate revenue for the Illinois Jobs Now! capital construction program, including state-funded road and bridge projects.

Video gambling could generate an estimated $2,250 annually for the village in taxes for each gaming machine in Elburn, according to a report by the firm of Arduin, Laffer & Moore Econometrics.

The state imposes a 30 percent tax on the net income from each video gambling terminal, featuring poker, blackjack or other games. Of that tax, one-sixth will go to the village.

Village Attorney Bob Britz told trustees on Monday that it will be 60 days, as required under the act, before the Illinois Gaming Board adopts rules needed to enforce the act, but final regulations could take more than a year to develop.

“It’s going to take awhile for the state to adopt regulations; so, the village has time to decide which way it wants to go,” Britz said during the Committee of the Whole meeting Monday.

Village President Dave Anderson said he attended a meeting of the Metropolitan Mayors Conference in Chicago on Aug. 7, during which a presentation about the Video Gaming Act took place. He said presenters included representatives from the Illinois Municipal League and Chicago area municipalities.

“Other mayors said they are not sure what they want to do,” Anderson said.

A municipality may prohibit video gambling by passing an ordinance banning the machines within its geographical limits. Voters also may try to prevent video gaming; they would have to file a petition from at least 25 percent of registered voters of the municipality at least 90 days before an election; then, a proposition could be placed on the ballot asking whether video gaming should be prohibited.

Counties may ban video gaming by ordinance for unincorporated areas. For incorporated areas, the decision whether to ban video gaming is up to municipalities.

Village trustee Bill Grabarek said he wants the village to enact a ban on video gambling, which could be reversed later. For now, he wants to make sure Elburn disallows it until the village is certain it wants it.

“You’re not going to get family-oriented businesses (restaurants) in the village if you have five machines going clinkety-clank,” Grabarek said.

Grabarek called the additional tax money the village would receive, “chump change.”

Gaming machines will be regulated

Gov. Pat Quinn signed the Video Gaming Act July 13, allowing video gambling terminals in bars, clubs and restaurants with liquor licenses.

The Illinois Gaming Board has jurisdiction over all video gaming operations; local governments and police will not be responsible for administering or enforcing the act.

Under the act:
• video terminals, up to five machines per establishment, for games such as poker or blackjack, must be located in an area of the business that is restricted to people 21 and older. The entrance to this area must be in the view of at least one adult employee.

• video gaming terminals may only be played during the legal hours of operation allowed for the consumption of alcoholic beverages at the establishment.

• the maximum wager played per hand may not exceed $2. Additionally, the cash award for the maximum wager may not exceed $500.

• establishments that violate the act will be subject to fines and possible revocation of their liquor and video gambling licenses. Any licensee who knowingly permits a person under the age of 21 to use or play a video gambling terminal will be fined up to $5,000.

Source: Illinois Liquor Control Commission