Author: David Barnett, Research Analyst
The Illinois General Assembly is back in session today to discuss Senate Bill 7, which would expand gambling in the state by permitting casinos to be built in Chicago, Danville, Rockford, Lake County, Cook County and Williamson County.
What’s the scope?
The bill is one of 13 in the latest budget package proposed by the Illinois State Senate in an attempt to mitigate the current budget crisis. While the package provides concessions for both sides of the political aisle, there are still many issues driving a wedge in any compromise, such as workers’ compensation. The political climate makes the budget package vulnerable, which is compounded by the fact that if one bill fails, the whole package fails.
Why is it important?
All 13 bills would affect Illinois and Chicago in their own unique way, including Senate Bill 7. It would be an additional source of revenue for a parched state and city. According to Bisnow, the Rivers Casino in Des Plaines brought in $164 million in tax revenue for the city and $400 million for the state in 2016. This revenue impact could be greater for a CBD-located casino. For example, in Detroit, the MGM Casino brought in $582 million in 2015, Motor City brought in $464.5 million and Greektown generated $329.9 million, according to the Michigan Gaming Control board.
The state’s finances need improvement. There is $129.8 billion in unfunded pension liabilities and the stopgap budget (six-month budget signed in June of 2016) expired, according to the Commission on Government Forecasting and Accountability. The lack of a sound budget in Illinois constricts public spending and limits politicians’ options in solving other issues, such as education and social services. Additional revenue from casinos may help soften these drawbacks.
How can this bill affect Chicago?
While a casino could generate much-needed revenue, many residents and policymakers cite increased costs on public safety and quality of living standards in their opposition. On the other hand, casinos may be an additional solution to supplement Chicago’s dynamic expansion. The market continues to attract companies from the suburbs and out-of-state as it cements itself as a world-class city with a strong and diversified economy. Permitting the construction of a centrally located casino could increase tourism for Chicago, which would drive demand for hospitality and retail space and produce revenue from property taxes.
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Sources: JLL Research, Bisnow, Commission on Government Forecasting and Accountability, Michigan Gaming Control Board, Reboot Illinois