Illinois State Laws Must Be Amended For Chicago Casino
There was talk in recent months that Chicago could finally open its doors to a new casino. However, that seems out of the question as of now as the Illinois Gaming Board has confirmed that a recently enacted law is preventing the city from getting a casino resort. If Chicago is to welcome a new casino resort, then certain laws need to be amended before a casino resort development proposal can be considered for Chicago.
This is why the Gaming Board has recommended to the Illinois legislature that it should make modifications to how licenses should be issued to Chicago casinos. The main point of contention is due to the high tax and fee structure in place for any casino operation in Chicago.
Before the current gambling expansion this year, Illinois would only allow up to ten riverboat casinos. They are often taxed from between a range of 15 percent to 50 percent in taxes depending on their gross receipts.
Thanks to the recent bill, the state can now authorize six more casinos to be developed. One of these licenses is available for a casino resort in the city of Chicago. The problem is that the new bill requires the Chicago casino operator to pay an additional 33.3 percent “privilege tax.”
That is pretty high when combined with the existing taxes, Chicago casino operators will have to pay around 72 percent in taxes which leaves very small margin for them.
In the report, the board said
To the extent a casino operator could pare down expenses and realize modest revenue and profits from non-gaming amenities, total enterprise profit margin would, in a best-case scenario, likely equate to a few pennies on the dollar — and that would require the casino to be developed without incurring any debt as we believe no traditional financing would be available for such a development as debt servicing would likely well exceed any modest profits generated.
Discussions Could Be Held In October
The original report that made the recommendation possible was submitted by Union Gaming Analytics in September 2018 to the Gaming Board. Since then, the board has been aggressive in its campaign to change the current laws.
The main reason for this push is also in the report. It estimates that a casino in Chicago has the potential to be the highest-grossing casino in the state and would even beat out the current top performer which is the Rivers Casino in Des Plaines.
According to Emily Bittner, spokeswoman for Gov. J.B. Pritzker, the report shares some valuable insights and she says that the governor is willing to work with the state’s General Assembly to make the necessary changes. Lawmakers will be reconvening on October 28 and this issue might be on the docket by then.