Illinois Casino Mall Licenses Denied

Although the Video Gaming Act does not explicitly ban so-called casino malls, the Illinois Gaming Board rejected the license applications of three video café operators seeking to open in a strip mall in Hometown. Gaming Board Chair Donald Tracy called casino malls "a threat to Illinois gaming integrity."

The Illinois Gaming Board approved 101 new video gaming licenses in September. But the applications of three video café operators hoping to open in the Home Town Plaza strip mall in Hometown in Cook County were not among them. In fact, board members recently voted unanimously against Bella’s, Gigi’s and TC Pub No. 5 in an effort to stop so-called casino malls.

Gaming Board Chairman Donald Tracy stated casinos malls are “a threat to Illinois gaming integrity.” He added, “All three of these locations relate to what have been called video gaming malls, mini-casinos, casino malls and back-door casinos. I view gaming malls as back-door casinos, without the traditional safeguards of licensed casinos such as regulated security, on-site oversight, position limits, self-exclusion rules and internal controls.” Tracy quoted from a letter from state Rep. Robert Rita stating lawmakers never imagined casino malls when they passed the Video Gaming Act, although there is nothing in the existing legislation prohibiting them.

Under the act, licensed sites including restaurants, taverns and fraternal and veteran halls may install up to five video machines. Video cafes also are becoming more frequently licensed, catering to suburban women with wine, coffee, tea and snacks.

The video café developers planned to eventually open as many as nine independently owned and operated casino cafes in vacant storefronts in existing strip malls Hometown and Crestwood. Outraged at the gaming board’s refusal to license the operations, Hometown Mayor Kevin Casey said, “They just voted to kill 50 to 60 new jobs in Hometown. I just don’t think they understand how small our town is. I’m just trying to provide some economic development and jobs for the people in my community. People have been phoning my office asking to be placed on waiting lists for these jobs. There’s nothing in the state video gaming law that prevents this sort of thing and they’re only opposing this because, I guess, the people in Springfield have nothing better to do. They can’t come up with a budget or pay the state’s pension systems, but when I try to do something for my town they have the time to stop me. I really don’t understand the logic.”

David Israel, owner of Learsi & Co. in Northbrook, which owns Home Town Plaza, said he invested more than $1 million in renovations at the strip mall to attract video cafe operators. He added before that, a gaming board attorney assured him nothing in existing law prohibited a casino mall and he even showed gaming board officials the site to make sure his actions were in compliance. In August, Israel protested the gaming board’s three-month delay over Hometown casino mall licenses and implied he might sue if the license applications were rejected.