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posted: 2/22/2014 8:00 AM

Des Plaines says more gambling should mean more money

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  • Des Plaines officials say they would seek additional gaming tax revenues from Rivers Casino were the state legislature to approve gambling expansion plans.

      Des Plaines officials say they would seek additional gaming tax revenues from Rivers Casino were the state legislature to approve gambling expansion plans.

 
 

Des Plaines currently splits gaming tax revenues from Rivers Casino with the state of Illinois and 10 communities in the south suburbs, but city officials say they want a bigger piece of the pie if and when the state signs off on gambling expansion.

The city is required to share tax proceeds each year as part of the agreement that led to the Illinois Gaming Board issuing a 10th and supposedly final state license for a casino in Des Plaines.

This week, the city council approved the distribution of more than $5.8 million to 10 so-called "benefiting communities," and $10 million to the state. Des Plaines will keep $8.79 million in gaming tax revenues, in addition to about $800,000 in property, sales, licensing and food and beverage taxes.

Since opening in July 2011, Rivers Casino has proved to be a valuable revenue source for Des Plaines and the other towns, which have used gaming tax proceeds to fund everything from infrastructure projects to early debt payments.

Rivers is the top earning casino in the state -- raking in a total of $418 million in 2013 -- and it's the only casino whose revenue increased from the year before.

In order to secure the 10th casino license in 2008, Des Plaines officials agreed to pay the state $10 million a year for 30 years, and to pay 40 percent of the remainder to 10 economically disadvantaged communities.

City Manager Mike Bartholomew said while the agreement is "good" for Des Plaines under current circumstances, city coffers could be adversely impacted if state legislators were to approve legislation that would expand gambling.

"Our position has been we love our casino and agreement," Bartholomew said. But if the legislature decides to open up the door to more casinos, "we want an opportunity to change our agreement," he said.

Some proposals that have previously arisen in the legislature include new casinos in Chicago, Lake County and the south suburbs, as well as slot machines at Arlington International Racecourse and the airports.

Gambling expansion could lead to Des Plaines lobbying for the state and the 10 south suburban communities to get less of a cut from Rivers.

"If you're going to change the rules, we want to open the agreement," Bartholomew said.

Gene O'Shea, a spokesman for the gaming board, said it's unclear right now exactly how Des Plaines could go about making changes to the agreement, but said any changes would likely need the blessing of the gaming board.

"That would be something I think our legal people would need to look at," O'Shea said.

Rivers Casino spokesman Dennis Culloton said casino officials would be open to hearing from the Des Plaines mayor and city council on the issue.

While Des Plaines' arrangement is the only one statewide that allows outside municipalities to receive gaming tax revenues, O'Shea said the Grand Victoria Casino in Elgin donates 7.5 percent of its annual net operating income to Kane County and 12.5 percent to the Grand Victoria Foundation, which offers grants to nonprofit community groups.

Under the current Des Plaines-Rivers agreement, revenues are distributed among the 10 south suburban towns based on their population.

Chicago Heights is receiving more than $1.6 million from 2013 gaming tax proceeds because it's population of 30,200 is the greatest among the 10 towns.

By comparison, Hodgkins, with just under 1,900 residents, gets the least: $102,752.

Des Plaines Sixth Ward Alderman Mark Walsten, whose ward includes Rivers Casino, said he's believed all along that the deal has been unfair, and thinks there should be uniform requirements for how gaming tax revenues are distributed throughout the state.

"It's not a fair playing field. We're subject to all this splitting of money where other casinos aren't, and that's just completely unfair," Walsten said.

Des Plaines is paying three lobbyists to keep track of proposed gambling expansion legislation in Springfield and how it might affect Des Plaines, Bartholomew said.

In 2012, Des Plaines received $8.88 million in gaming tax revenues, which it used to pay off debt early, begin construction of infrastructure for an alternate water source, build a water main on River Road, and complete other stormwater improvements.

The city will pay for infrastructure projects with the $8.79 million it received from the casino in 2013. Specific projects will be identified as part of the city council's budgeting process, Bartholomew said.

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