Momentum Gaining for Slots in Illinois

A tight state budget and political maneuvering are combining to brighten the prospect for approval of slot machines at racetracks in Illinois. But reluctance on the part of key political leaders to take the lead on expanded gaming still looms as a large roadblock to approval of the proposal.

The biggest boost for slots-at-tracks may have come from Gov. Rod Blagojevich's April 9 budget proposal to again hike the state tax on riverboat casinos. The freshman Democrat, trying desperately to plug a multi-billion-dollar hole in state finances, suggested raising the tax from 50% to as much as 70% for the most successful casinos.

Financial analysts and political opponents quickly pointed out that any such increase would make it much more difficult for the state to auction off the currently unused 10th riverboat casino license. The sale of that license is another key piece in the governor's financial jigsaw puzzle. So a big tax hike could be counterproductive to the overall revenue picture.

Racetracks currently are entitled to a share in the revenue of a 10th casino. Several track lobbyists, however, have indicated they would forfeit that entitlement in favor of on-track slots.

A compromise package, including expanded gaming stations at existing riverboat casinos and authorization for slots at tracks, appears to be one of the few alternatives.

Blagojevich, who campaigned last fall against "expansion" of gaming, said he "would hope that we can balance our budget without having to go that direction." But other influential legislators said alternatives are more likely and that they plan to draft legislation accordingly.

House Speaker Michael Madigan may be the most formidable barrier to the tracks-at-slots piece. Spokesman Mark Brown said the speaker likely will not support authorization of slot machines at tracks.

"He believes the tracks are a place for horses to race and probably ought to be confined to that," Brown told the Arlington Heights Daily Herald.

Since it is unlikely that Blagojevich or the General Assembly can produce a balanced budget without additional gaming revenue of some sort, most observers believe a deal will be cut before the session ends in May.

Lobbyists for several major national gaming companies have joined the debate, hoping to play a role in any expansion.

Nonetheless, recent legislative history is replete with failed attempts to forge compromises between tracks, casinos, and state regulators.