Illinois: The Cost of Corruption

Ill. lawmakers prepare to roll dice on Chicago casino amid corruption, oversight concerns

CHICAGO — Visitors to the nation’s third-largest city are usually spotted wandering the Magnificent Mile, snapping pictures of the Willis Tower and sampling Chicago-style deep dish pizza, but if some persistent Illinois lawmakers and Mayor Rahm Emanuel get their way, a glitzy casino would be on their agenda, too.

Trying to land a Chicago casino has become an annual sticking point, despite political gusto from mayors and legislators who want to expand gambling in Illinois. Gov. Pat Quinn has axed two gambling bills and invoked images of infiltrating “mobsters.” Along that same theme, the head of the Illinois Gaming Board said the pending plan is inherently problematic because of the way a Chicago casino will be managed.


Still, the latest bill — which recently cleared the Illinois Senate and also would allow slot machines located in lounges at O’Hare and Midway — appears to have the best chance yet.

For the first time, Quinn signaled his support for gaming in a major speech, saying this year that he’d be open to a gaming bill if the revenue benefits schools, a stance that comes as Illinois faces mountainous money problems.

Meanwhile, Emanuel is pushing hard for the proposal, lawmakers are eager to rework it and business leaders would love the chance to plant a casino in Chicago — the largest American city to date — with thousands of noisy slots, an entertainment venue and a continuous flow of money-spending tourists.

“It’s not just another riverboat casino, it has the potential to be a destination in its own right,” said Jack Johnson, head of the Chicago Convention & Tourism Bureau. “Anytime you can add another destination to Chicago, it’s one more reason to come.”

The bill calls for five new Illinois casinos, including one in Chicago, and airport slots. If airports want them, Chicago would be unique among U.S. airports outside Las Vegas. The plan would establish a Chicago Casino Development Authority, a board of mayoral appointees. The Illinois Gaming Board would have regulatory oversight, but most everything else, including contracts and day-to-day operations, falls to the city board.

And there’s the potential rub.

Some experts raised concerns at the Chicago setup when compared with urban casinos — in Philadelphia, Detroit and New Orleans — where the state board oversees everything.

“That is a rare situation,” said Doug Walker, an economics professor at the College of Charleston.

“Anytime you have a new group of regulators, there’s another potential area for corruption.”

That very issue prompted state gaming board head Aaron Jaffe to question why Chicago needed its own board and resulted in a spat with lawmakers during a hearing on the bill last month. That followed similar questions from Quinn, who vetoed gambling bills over lack of ethical standards. It’s a theme he often brings up in a state where four of the last seven governors have gone to prison, including his predecessor Rod Blagojevich.

Even opponents who typically raise concerns about potential social costs — including increases in problem gambling — are also talking about ethical concerns. Partly that’s because it’s not hard to find corruption headlines in a city that’s been under a court order to root out political patronage or where federal data shows more than 1,500 public corruption convictions since the mid-1970s.


“They’ve had scandals ... all kinds of scandals,” said Anita Bedell, head of the Illinois Church Action on Alcohol and Addiction Problems. “You think it’s going to be different now?”

Lawmakers acknowledged some of those concerns in the proposal, adding a ban on political contributions from the industry, an inspector general and, most recently, stating explicitly that the state board has final say over all regulation.

But the Chicago board remains in place.

“They’re like the business manager,” explained Democratic Sen. Terry Link, a bill sponsor. He says it’s not unlike other Chicago entities. The state created the Metropolitan Pier and Exposition Authority, which owns McCormick Place, a convention center. Both the mayor and governor appoint members.

Emanuel, who said he supports Quinn’s ethical oversight concerns, also defended a city board, saying it’s needed to protect Chicago taxpayers’ interests.

The mayor boosted his support for the casino this week by pledging 100 percent of revenue will go to schools. The move comes as he proceeds with a controversial plan to close 54 schools and follows last year’s teachers strike.

Quinn has said he’d support gambling after lawmakers address the state’s nearly $100 billion unfunded pension liability, the worst nationwide. The plan is expected to bring in roughly $1.2 billion in one-time revenue and about $270 million annually. But Quinn has been noncommittal on whether he’d sign the bill if House lawmakers approve it. He’s also reticent on specifics, like what he thinks of the Chicago board.

Meanwhile, urban planners and tourism officials hope a Chicago casino boosts business. No specifics on a location have been publicly discussed, but some potential sites have been mentioned.

Urban planner Kim Goluska, who for nearly two decades did casino research for former Mayor Richard Daley, said possible sites include the glass-paneled James R. Thompson Center downtown, a state building with an enormous atrium; the Congress Plaza Hotel on Michigan Avenue; and Chicago’s former main post office, a dingy building straddling a freeway.

Others include a former hospital site on the South Side and McCormick.

Johnson said that any site could work, depending on transportation. He pointed to the success of Wrigley Field and the Steppenwolf Theatre as tourists destinations, which aren’t downtown.

Goluska said any casino should be incorporated into the city’s urban core to buttress other businesses. His top pick would be the Thompson Center, which is walking distance to Chicago’s Theater District, shopping and hotels.

“The spinoff benefit of doing this right should make the gaming revenue pale by comparison,” said Goluska, president of Chicago Consultants Studio, Inc. “It’s important that this is done right.”

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