Results were shared with the Bloomington City Council on the July 23rd. 475 total participants responded to the question "Are you in favor of the City Council approving Video Gaming in the City of Bloomington?" utilizing the City's web based survey. 406 responded "Yes" to the question and 69 responded "No".
On July 13, 2009, the Video Gaming Act was signed into law by Governor Quinn. The Act legalizes video gaming and establishes a tax on the proceeds, a portion of which goes to the municipality where the video gaming takes place. At present, the ordinances of the City of Bloomington do not allow video gaming. Chapter 20, Section 2 of the Bloomington City Code prohibits persons from playing “for money or other valuable thing at any game with cards, dice, checks, or at billiards, or with other any article, instrument, or thing whatsoever which may be used for the purpose of playing or betting upon or winning or losing money or any other valuable thing or article of value.” Similarly, Chapter 6, Section 37(e)(10) makes it a violation of the Bloomington Liquor Code for a licensed liquor establishment to permit “any gambling device or equipment to be located on the licensed premises.”
The City has the option of either adopting amendments to the above ordinances that would allow for video gaming, or to choose to allow the ordinances prohibiting video gaming to remain in effect. This memo and the attached materials are intended to provide information to assist the Council in making that determination.
Video Gaming Act Summary
There are four categories of establishments where video gaming is allowed under the Act:
- “Licensed establishments”: A licensed establishment is any licensed retail establishment where alcoholic liquor is served for consumption on the premises. In Bloomington, there are 81 restaurants and 31 taverns that could potentially qualify for video gaming licenses under this category.
- “Licensed fraternal establishment”: A licensed fraternal establishment is a location where a fraternal organization that derives its charter from its national parent organization regularly meets. There are approximately 5 establishments of this kind in Bloomington.
- “Licensed veterans establishment”: A licensed veterans establishment is a location where a qualified veterans organization that holds a charter from its national parent organization regularly meets. Two organizations could qualify under this category for video gaming licenses.
- “Licensed truck stop establishment”: A licensed truck stop establishment is a facility of at least three acres with a convenient store, separate diesel islands for fueling commercial motors vehicles and parking spaces for commercial vehicles. Two locations in Bloomington could presently qualify for video gaming licenses under this category.
No more than five video gaming terminals (VGT’s) are allowed in any single establishment. Income generated via VGT’s and related processes will be collected by the State of Illinois and distributed as follows:
- A tax of 30% is imposed on net terminal income and shall be collected by the Board.
- Of the tax collected under this Section, five-sixths shall be deposited into the Capital Projects Fund and one-sixth shall be deposited into the Local Government Video Gaming Distributive Fund.
- Twenty-five percent of fees collected shall be paid, subject to appropriation by the General Assembly, to the Department of Human Services for administration of programs for the treatment of compulsive gambling.
Survey of Other Municipalities
A review of the Illinois Gaming Board’s website and the ordinances of various municipalities throughout the state indicates:
- 344 municipalities in the State of Illinois do not allow video gaming
- 342 municipalities in the State of Illinois do allow video gaming
- 778 municipalities in the State of Illinois are not yet classified as allowing or not allowing video gaming
Among the 344 communities that prohibit video are Springfield, Carbondale, Clinton, Moline, Eureka, Lincoln, Morton, Naperville and Schaumburg. The 342 municipalities allowing video gaming include Normal, Peoria, East Peoria, Champaign, Urbana and Decatur.
Given the lack of historical data, it is difficult to accurately assess the financial impact of video gaming. City video gaming revenues will be derived from 5% of total video gaming revenue collected within City limits. The funds will collected by the State and deposited in a separate Local Government and Video Gaming Fund and will not be deposited into State general fund. The Illinois Municipal League advises using an estimate of between $1,500 and $2,000 per machine annually in local tax revenue.
Organizations supporting video gaming have provided City staff with more than a few scenarios outlining the potential tax revenue to be collected by the City of Bloomington; these groups include Midwest Electronics, whose projections range from $286,160 to $447,125/year and the Illinois Coalition for Employment and Business Growth, which estimates $610,000/year can be collected by the City of Bloomington as a result of video gaming. This vast discrepancy is due in large part to the considerable number of variables involved in the equation, including:
- Number of establishments that desire video gaming terminals
- Number of establishments that qualify for video gaming terminals
- Number of establishments that are awarded approval for video gaming terminals
- Number of video gaming terminals installed in each of the approved establishments
- Revenue generated by each of the video gaming terminals
- How and when the state will allocate collected revenues
The lack of historical data also makes it difficult to estimate the costs to City and social services that may be incurred as a result of dealing with the effects of problem gambling behaviors.
Other factors to be considered when assessing the approval of video gaming include the effects of gambling on local residents and families. Staff have reached out to Chestnut Health Systems for statistical data and professional recommendations surrounding the topic, but has yet to receive an official response. According to their website,
“Problematic gambling occurs when there is a disruption in any major area of life: psychological, physical, social, financial, or vocational. It is characterized by a preoccupation with gambling, a need to bet more money more frequently, restlessness and irritability when attempting to stop, chasing losses, and the feeling of losing control. The goal of Chestnut Health Systems is to increase the awareness of problematic gambling and to provide treatment for problem gamblers and their families. Chestnut Health Systems offers a comprehensive assessment for gambling and substance abuse problems in a safe environment. If the assessment suggests that problematic gambling treatment is appropriate, Chestnut offers individual and group counseling, family counseling, and relapse prevention. We will also assist in developing a support system and in addressing financial and legal issues that are the result of problem gambling behaviors.”
Chief McKinley’s statement with regard to the position of the police on the issue of whether video gaming should be allowed is as follows:
It has been said in our community that gambling occurs everywhere. To some extent I am sure that is correct, as we do not manage or regulate what goes on in private residences. Without a complaint on file or legitimate intelligence that we have illegal gambling occurring within the city there is little reason for our department to take action. Back in the 1990's we along with ISP Task Force 6 did some work on gambling complaints with some success. Since that period we have recently cited a business in our downtown district for allowing illegal poker gambling.
We have few concerns over the proposed video gambling, considering the far more problematic, full-scale gambling that is seen throughout parts of our state and many others. The limited nature of this type of gambling does not raise concerns such as increased levels of prostitution, robbery, organized criminal activity, or even raising levels of addiction, because of the limited scope of availability. We are not as concerned with video gaming, given the limited scope of this activity, as we are with, for example, card games for money, where there tends to be more cash involved in less controlled settings. I would like to see this activity remain limited to a small number of machines in each establishment to prevent this activity from becoming the main focus in any single establishment. I see this as another level of entertainment while the patrons enjoy the other services provided by these establishments.
The following documents are referenced from the Illinois Gaming Board: