In My View: No to more gambling giveaways
By JOHN KINDT
Posted Jul 28, 2012
Gov. Pat Quinn is expected to veto the 2012 gambling expansion bill, SB 1849, because of the refusal of the bill’s sponsors to prohibit political and campaign contributions from gambling interests. By vetoing this bill, which would create six new racetrack casinos (called “racinos”) plus five land-based casinos, Quinn will be confirming the tradition of “The Untouchables.” Today, Illinois needs “The New Untouchables” as historically embodied by such organizations as the Chicago Crime Commission established to combat Al Capone.
Pursuant to a 2012 study by the Institute of Government and Public Affairs at the University of Illinois Springfield, thecity of Chicago is the most corrupt area in the U.S.
Gov. James Thompson’s administration authorized the legal granting of the 10 original casino licenses for $25,000 each to political insiders, although the total fair market value of the licenses was $5 billion ($9.5 billion in 2012 dollars). One license was granted to a political insider convicted in the Rod Blagojevich scandals. The 2012 gambling bill gives away another $3.5 billion to $5 billion, among other giveaways, by charging just $100,000 per casino license.
Since the original 10 casino licenses were granted, academics at UIS have spent two decades documenting millions of dollars in legalized political and campaign contributions made by lobbyists to legislative supporters of gambling.
Disturbed by the spreading political corruption accompanying legalized gambling, U.S. Sen. Paul Simon sponsored the bipartisan U.S. National Gambling Impact Study Commission. The panel’s final report called for a moratorium on the expansion of any type of gambling anywhere in the country, and the commission included recommendations for stringent curbs on campaign contributions, the recriminalization of slots/electronic gambling machines convenient to the public, and continued prohibitions on creating racetrack casinos. The Illinois 2012 gambling expansion bill obviously ignores all of these recommendations and adds to the national embarrassment of Illinois.
The state of Virginia rejected casinos during the same time frame that Illinois authorized its first 10 casinos. Virginia now has a surplus, while the Illinois budget is the nation’s worst.
If the Illinois legislature really needed money, it could immediately collect at least $5 billion in casino license fees that the casinos should have originally paid — instead of the mere $25,000 per license. In 2003 legislative presentations in Springfield by the Maryland Tax Education Foundation, for example, the fair market value of the Illinois casino licenses were pegged as being worth up to $500 million each.
Apparently, only troubled casino licenses have a fair market value under $500 million, as casino licenses are laundered by regulators from one casino owner to the next. In 2001, it was reported that Nevada’s Jack Binion, the tycoon of Horseshoe Gaming, was ruled unfit for his $25,000 Illinois casino license. Accordingly, Binion sold his Illinois casino interests for $465 million.
If Illinois needs tax revenues, the current casino license fees are a pot of gold worth billions of dollars. Until these billions are collected, authorizing racinos and new casino license giveaways to political insiders via SB 1849 is a non sequitur. By vetoing gambling expansion, Quinn will draw favorable national attention to Illinois as the home of “The New Untouchables.”
John Kindt is a contributing author and editor of the U.S. International Gaming Report.
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