Video gambling terminals were legalized in Illinois in September 2012, starting with 61 machines. According to an annual wagering report from the Illinois Commission on Government Forecasting and Accountability, the state collected 0.5 million in tax revenues from 26,873 machines for the 12-month period ending June 30. More than 27,000 terminals were operating by the end of July and 28,000 were predicted by mid-2018.
“The number of new terminals has slowed. It just doesn’t seem that we’ve reached our peak,” commission senior revenue analyst Eric Noggle said. He noted video gaming growth has been spread across the state, although it’s still banned in Cook County and Chicago.
In the first two years of legalized video gaming, the state averaged 838 new terminals a month. In the latest fiscal year, the state averaged 249 new terminals per month, compared with 263 per month in the previous year.
State revenue from video gaming totaled $255.2 million from 23,891 terminals for the 2016 fiscal year. Revenue from gambling terminals to local governments rose from $51 million in fiscal 2015 to $60.1 million in fiscal 2016.
Statewide, net terminal income totaled $1.2 billion. Revenue from all forms of gambling totaled $1.3 billion, up 7.9 percent from the previous fiscal year. Increased video gaming revenue offset declines in lottery and riverboat casino receipts.
Springfield still has the most video gaming terminals in Illinois, with 635 in operation in the year ended June 30; they collected slightly more than $30.1 million, up from $29.2 million in net terminal income from 622 terminals for the fiscal year ending June 30, 2016.
Second-place Rockford collected $29.8 million from 451 terminals during the just-ended fiscal year.
Springfield Budget Director Bill McCarty said, “We continue to add terminals around the city.”
He said the city collects approximately $130,000 monthly from video gaming, not including fees, licenses and registrations. Video gaming revenue goes toward street, sidewalk, bridge and other infrastructure improvements.
Executive Director Anita Bedell of Illinois Church Action on Alcohol and Addiction Problems said some communities have begun to reconsider the financial and social costs of unlimited video gaming. For example, she said, the Champaign city council in June voted to extend a moratorium on new terminals to January 23 and the community of Washington approved a two-month moratorium in August.
In Aurora, the city council will vote on Tuesday, September 20 whether to impose a six-month moratorium on new video gambling terminal licenses in the city. The break would allow officials to evaluate how video gambling has impacted the city. Chief Management Officer Alex Alexandrou said, “We’re seeking to hit the pause button. We need time to study it.”
City Clerk Wendy McCambridge explained the city would review the density of currently approved video gambling terminals, their concentrations and other potential locations. McCambridge added the council also would consider if the machines potentially are located too close to schools or churches. “We could look at what to do to either limit them, or control them. We would look at those kinds of questions. How much is the city gaining from them?” McCambridge said.
Currently 141 gambling terminals are in operation in 31 establishments in Aurora. The city could accommodate up to 370 machines in 74 establishments, McCambridge said. She added two other locations have applied for licenses, which are being reviewed and would be granted if approved.
McCambridge said the city receives significantly more revenue from Hollywood Casino than from video gambling. In 2016, the city got $7.03 million in casino revenue, compared to $332,045 in video terminal revenue. Casino revenue reached a high of $15.4 million in 2006.
McCambridge noted other cities, including Peoria, have placed moratoriums on video gambling. Most Aurora aldermen support the idea, except Alderman Judd Lofchie. “I never like to hear moratorium. It’s bad for business.”
And in East Dundee, the village board recently voted to limit video gaming and liquor licenses to those currently in use. New applicants will be required to request approval directly from the board. East Dundee Village President Lael Miller said, “It gives us a little more control over who comes in.” The new ordinance also requires an automatic reduction in the number of available licenses when a license is revoked, expired without renewal, surrendered by the licensee or otherwise terminated.
“It’s pretty simple. We want to make this a zero-sum game and always be at zero availability so we can control the amount of video gaming that comes in,” Miller said.
Currently, 11 video gaming licenses are active in East Dundee; three are for businesses that exclusively are video gaming cafes. The village collected $150,000 in video terminal tax revenue in fiscal 2017.
