Casino revenue takes a beating
Like other casinos across the state, revenues from the Elgin's Grand Victoria were significantly lower this January compared to the same month last year.
Elgin City Manager Olufemi Folarin said the casino's revenues were down about 20 percent and if this decline continues for the remainder of 2008, it could result in $4 million less that is filtered back to the city.
The downturn means city leaders might have to make some tough decisions later this year on what infrastructure projects to delay or local programs to cut.
"The key thing to us is that revenue went down, substantially," Folarin said. "We'll look at the things that are supposed to be developed with riverboat money and adjust accordingly."
Casinos across Illinois have reported steep revenue declines since Jan. 1, when a statewide smoking ban went into effect.
The Illinois Gaming Board reported that casinos in the state experienced a 17 percent revenue decrease in January compared with January last year.
The hardest hit with revenue decline was Harrah's Metropolis Casino in Metropolis, near the Kentucky border. The casino reported an approximately 23 percent drop in revenue since December and said last week it will lay off 30 employees.
While the weather and poor economy have had some effect, gaming experts point to the ban as a large reason for the drop.
"The casinos all predicted this would happen with the smoking ban," said Elgin Mayor Ed Schock, who favors an casino exemption from the smoking ban.
Elgin expected to receive about $28.4 million this year from the casino, according to its budget.
If the 20 percent decline holds true, the city will still have $24 million of casino revenue to spend locally.
Historically, city leaders have used casino revenues on infrastructure improvements and one-time big ticket expenditures rather than paying salaries for employees or basic services.
"That's what we largely have done so it won't throw the city into crisis if we have a downturn in revenue," Schock said.
He said streets and road repairs would remain a high priority and expects by spring to have council leaders to discuss a list of projects to delay if needed.
"That's OK," Schock said. "While it's not preferable, we can live with that."
Grand Victoria officials could not be reached for comment Monday.