Chicago Mayor Lori Lightfoot Lobbies Illinois Legislature for State-City-Owned Casino
Posted on: October 22, 2019, 04:46h.
Last updated on: October 22, 2019, 05:07h.
Chicago Mayor Lori Lightfoot has called on lawmakers in Springfield to reopen the debate on a law enacted in late June that authorizes a major casino in the city.
Lightfoot wants the proposed casino to be a public, rather than private, enterprise, owned by the city and the state, as she struggles to juggle $1.3 billion in city debt and a $838 million budget shortfall that is the largest in the city’s recent history.
A Chicago casino has been an objective for years for a succession of mayors whose efforts had proved fruitless until this year. Last summer, Illinois Governor J.B. Pritzker signed a gambling expansion package that authorized a casino in the Windy City, along with five smaller regional casinos in the southern suburbs.
Passed as part of a much larger capital plan that earmarks billions for investment in infrastructure, the newly enacted legislation will vastly enlarge Illinois’ gaming sector, increasing the number of video gambling machines in the state as well as legalizing land-based and mobile sports betting.
But lawmakers are reluctant to revisit a gambling bill that has spent such a long time in the legislative pipeline. One who was influential in its passage told The Chicago Sun-Times that Lightfoot’s proposal would risk “open[ing] the floodgates for everyone who has problems with” the proposed casino, causing “unnecessary drama.”
Muddled Tax Structure
Lightfoot has made it clear that if a state-owned casino is out of the question, then the legislature must at least look again at the proposed tax structure of the venture.
A feasibility study commissioned by the Illinois Gaming Board and conducted by Union Gaming Analytics concluded the project would need to be developed without incurring any debt whatsoever because no right-minded private investor would finance it.
That’s because it would be the most highly taxed casino in America, should it go ahead at the proposed taxation rate.
Unlike its counterparts elsewhere in Illinois, the Chicago property would pay an additional 33 percent “privilege tax” to fund firefighter and police pensions. Along with upfront fees and regular taxes, this would see it pay a de facto rate of 72 percent on gross gaming revenue (GGR).
Operating expenses could easily hit 30 percent of GGR, which suggests the project would be unprofitable from the get-go.
Lightfoot is determined to cut costs, which includes downsizing municipal government by doing away with a “substantial number” of 3,100 existing vacancies and refinancing the city’s debt.
She is also lobbying Springfield for a graduated real estate transfer tax, which would slash the levy for people selling property for under $500,000 while increasing the tax bill on more expensive homes.
Pritzker admitted to The Sun-Times he had been “blindsided” by Lightfoot’s demands, having only learned about them by reading that very newspaper.
But without intervention from Springfield, Lightfoot said her only other option would be to raise property taxes — a sore point among Chicagoans, because they were more than doubled during the tenure of her predecessor, Rahm Emanuel.
“It’ll be very difficult to avoid a property tax increase if we do not get help from Springfield.…There are limited tools that a mayor can use to generate substantial revenue. Property tax is really chief among them,” said Lightfoot.
Related News Articles
Related News Articles
- December 18, 2020 — 11 Comments—
- January 10, 2021 — 7 Comments—