If you missed it last month, the state marked an anniversary. 4 years since the launch of video gambling. The machines you see in bars, restaurants, truck stops and other places have permeated the landscape since that time. Springfield leads the state with the most machines, Decatur is also near the top.
Overall, Illinois now has more video gambling terminals than Nevada.
Supporters of the changes say gambling in Illinois has meant jobs and money going to both state and local governments. More than $800 million so far. But John Kindt says government and taxpayers are getting too little back.
John Kindt is an Emeritus Professor of Business and Legal Policy at the University of Illinois. He calls gambling a “lose-lose proposition” pointing out the financial problems when people become addicted.
“And the worst type of gambling are these video machines,” he said, adding they have been compared to crack cocaine for their ability to attract and hook new gamblers.
And then, there’s the tax rate.
“These owners and operators are keeping 70-percent of the money. You talk about special interest legislation in Springfield. The state only gets 25-percent. The local community only gets 5-percent.” Kindt said.
“If you are going to do this, you need to tax gambling, not people. If you are going to have all these social costs….at least you ought to get some real taxes out of it.”
Kindt adds that Illinois has a history of undervaluing gambling licenses, often to benefit the politically connected.
“In most states, there is a much higher rate on these video gambling machines especially. The fair market value of a riverboat casino license on Wall Street is about half a billion dollars,” he said. “And the original casino licenses in Illinois (in the early 1990’s) were given away for $25,000 a piece.”
“Obviously, the state doesn’t need the money,” Kindt joked.