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Shrinking gambling industry will not cure Illinois’ money woes

TAGs: Bob Rita, COGFA, Illinois, Illinois Lawmakers, Jasmine Solana

Shrinking gambling industry will not cure Illinois’ money woesLawmakers placing their bets on expanding the gambling industry in Illinois to replenish the state’s depleting coffers are in for disappointing news.

A new report from the General Assembly’s Commission on Government Forecasting and Accountability showed that state revenues from all forms of gambling reached $1.184 billion in fiscal year 2015, which is a 5.8 percent drop from FY 2014’s $1.258 billion.

Lottery made the biggest contribution at $690 million, followed by riverboat gambling at $292 million, while revenues from video gaming came in at $196 million, and horse racing at $7 million.

Illinois originally receives gambling tax from three sources—riverboat gambling, lottery and horse racing. But in 2012, the first legalized video gaming machines were put into operation. According to COGFA, revenue from video gaming machines contributed $241 million to state and local government coffers this year, but it was not enough to offset the $29 million loss in riverboat gaming transfers and the $125 million decrease in lottery transfers.

Meanwhile, state revenues from horse racing remained stagnant this year, generating only $7 million for the past seven years.

“The landscape of gaming in Illinois is in the midst of change,” the report stated. “The rapid expansion of video gaming throughout the state is providing Illinois residents more gambling options than they have ever had before. But despite the addition of these new gaming opportunities, for the first time in four years, state revenues from gaming-related sources in Illinois experienced a decrease in the amount collected.”

Lawmakers have been looking at gambling expansion as a possible source of the much-needed revenue for the state in the midst of Chicago’s ballooning public pension payments and Illinois’ multi-billion dollar budget deficit.

Last May, state lawmakers weighed on the merits of gambling expansion in Illinois. State Rep. Bob Rita sponsored HB 2939, which addresses a potential state-owned Chicago casino. A second proposal, HB 3564, would pave the way for few new casinos and would also expand gaming positions at the race tracks.

News outlet Progress Illinois quoted Rita, who said, “Revenue is more of a need today than it was last week.”

Gambling expansion in the state, however, remains in limbo due to a stalemate between Gov. Bruce Rauner and Democratic leaders at the General Assembly. Rauner is supportive of new gambling bills, but he wants the legislature to pass his legislative priorities before he signs off on a bill. Democrats, on the other hand, have shot down Rauner’s proposals.

Rauner spokeswoman Catherine Kelly told The State Journal-Register back in May that “new revenue cannot be discussed until we address the underlying structural issues that contributed to Illinois’ fiscal crisis.”

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