Several Southland towns in Illinois held special meetings on Sunday, November 14 to pass a new penny-per-play tax on video gambling terminals.
Calumet City, Dolton, Markham, South Chicago Heights, University Park, Mount Prospect, Hanover Park, Hoffman Estates, Schaumburg, Algonquin, Wheeling and Lake in the Hills are among the communities that approved the tax. Collection start dates vary among them. Homer Glen trustees rejected the tax.
The towns held the votes in response to the Illinois General Assembly’s approval on November 12, of legislation prohibiting municipalities from adopting the tax after Sunday. The measure awaits Governor J.B. Pritzker’s signature.
The tax first was enacted by Oak Lawn on January 1, 2020. It immediately was challenged in court by the Illinois Gaming Machine Operators Association; legal actions still are pending. The group argued the tax is unconstitutional, violates the state’s Video Gaming Act and would be costly and technologically challenging to implement.
Some smaller village businesses such as bars also claimed the tax would affect operations which have already been impacted by Covid-19. They said if the tax is enacted, they’ll have to lay off employees or reduce operating hours. Other towns decided to delay action due to the pending litigation.
Mike Pappas, executive vice president at Accel Entertainment, said the tax “is a bad idea now and will be a bad idea in the future.” Accel is a plaintiff in the association lawsuit challenging the tax. “We fully expect to win it,” he said, noting developing software that deducts a penny every time a player hits push “would be very painstaking to get.”
The tax falls on gamblers, but the machine owners are designated as tax collectors, responsible for tallying how many pushes or individual games are played and filing documents with the municipality, along with submitting tax payments.
In Wheeling, which has 107 gaming machines at 20 locations, city attorney James Ferolo urged trustees to apply the tax as soon as possible. “It shouldn’t be something we put on a shelf,” Ferolo said.
At the Wheeling meeting, trustees heard from representatives of Support Main Street Illinois, which promotes state legislation favoring the video gambling industry, and Lucky Street Gaming, a Rockford-based video gambling terminal operator. They said the push tax would drive players to gambling-friendly businesses in towns that don’t charge the tax.
