Video gambling going live at suburban bars
After more than a two-year wait, legalized video gambling is finally expected to go live across Illinois -- as in, the machines will be turned on and customers will be able to play -- in the next couple of weeks.
Among those who got an early taste was Robert Franklin, of Sapulpa, Okla., a customer at The Assembly American Bar & Cafe in Hoffman Estates. The eatery is among a handful of licensed establishments throughout the state where the machines are already operating as part of live testing.
"I didn't do too well," said Franklin, who was in the Chicago area for business. "I lost $6."
No matter, he said -- playing video poker and other games is always entertaining. "I look at it like going to the movies, except that you can make some money. If you don't have the money to lose, then don't play," he said.
So far, video gambling licenses have been approved for 324 eateries and taverns, 12 truck stops, four veterans' groups and one fraternal organization throughout Illinois, Illinois Gaming Board spokesman Gene O'Shea said. More were being added to the list Thursday.
Live testing began Sept. 7, and machines are now running at The Assembly, plus establishments in Port Barrington, Morton Grove, Rockford, Machesney Park, St. Anne, and Strasburg, O'Shea said. Testing was expected to last two to three weeks, or until the Gaming Board and New York-based Scientific Games Corp., which operates the system for Illinois, were satisfied everything is working properly, he said.
However, while video gambling is almost ready to launch, operators have lagged behind, O'Shea said.
About two-thirds of approved operators still need to get their financing in order, so fewer than 50 licensed establishments have machines installed right now, he said.
The estimated cost of installing five machines -- the maximum allowed per establishment -- plus cash-out devices is up to $80,000, he said. "The operators are slow to get the financing they said they were going to get," O'Shea said. "We're going to be up and running, and they won't."
Gary Taylor, co-owner of The Assembly, said he's excited video gambling is finally a reality, but he now has to work to entice customers.
"They turned on the machines yesterday (Sept. 19). We had a busy night, but no one was interested in the games," he said. "Maybe it's because they were sitting there unused for so long. (Operator) Universal Gaming Group will bring some balloons and we will try to roll it out in a big way so people realize the machines are live and are able to be played. It's just a little more marketing than we thought."
The Video Gaming Act was enacted in July 2009 for bars, restaurants, fraternal organizations, veterans groups and truck stops. Municipalities can be excluded from video gambling by either opting out under the law or by passing an ordinance that bans video gambling.
The process, however, was first complicated by a lawsuit challenging the constitutionality of the law's funding mechanism and then by errors made by the Gaming Board during the contract process. Scientific Games was awarded a six-year contract in December 2011.
Establishments that apply for a license are investigated in several ways, including checks for a criminal record, tax compliance, compliance check with the Illinois Liquor Control Commission, as well as contact with the local law enforcement and liquor licensing authority. There is also an inspection of the establishment itself.
In the wake of the state law, some municipalities have decided to allow video gambling, like Fox River Grove and Elk Grove Village, while others, like Lake Zurich and Sugar Grove, decided to ban it. Many have long-standing laws against it and have taken up the subject in recent months, like Algonquin.
How much money?
The Video Gaming Act sets a minimum game payout of 80 percent. Each individual bet has a maximum of $2, with a maximum $500 payout per bet.
Under the act, 5 percent of the machines' net revenue is returned to municipalities, and 25 percent goes to the state for capital improvements; the rest is split between the establishments and game operators.
Each machine holds multiple games with different themes like poker, slots, sports and more, said Monica Breslow, who with her husband, Robert, owns Universal Gaming Group, which has offices in Chicago and Addison.
"I think that for people who like to play slots when they play at a casino, this is a way for them to play at their favorite establishment and keep the money in the municipality," Breslow said. "This provides a legal way to play, and at the same provide a portion of dollars that goes to schools and roads."
Algonquin resident Rich Restagno is among those who are hoping to start trying their luck at their neighborhood bar, rather than drive all the way to casinos.
Restagno is a regular customer of Creekside Tap in Algonquin, whose owners were among several business owners who last month pleaded with the village to allow video gambling. The village board is still considering the issue.
"I've always enjoyed it. When I heard about it maybe coming to bars, I said, 'This is great, me and the wife won't have to go to the casino in Elgin.' You got the whole tree at Grand Victoria -- let the small bars have a branch."
Bad or good?
Supporters of video gambling tout the potential for state revenue, which officials at the time estimated at $375 million per year, plus local revenue to municipalities and establishments.
Some, however, warn of the potential negative consequences of video gambling.
Thousands of people are on the exclusion list from riverboat casinos, a large number because of addiction to video poker, said Scott Damiani, executive director of the Outreach Foundation in Downers Grove. "Now unfortunately they have a place to go where they don't have to worry about being arrested," he said.
Video gambling can be a real addiction, Damiani said.
"Video poker is called the crack cocaine of gambling. It's probably the most addictive type of gambling that a person can be involved with," he said. "They sit in front of a machine and nobody is going to bother them."
But Bob Kmiec, who owns Zaza's Steakhouse & Italian Eatery in Fox Lake, says it's all about personal responsibility. The establishment was approved for a license and already had the machines delivered.
"Isn't the lottery gambling? If this is dangerous in your backyard, isn't it just as dangerous if you're going to the casino? We're not talking about children, we're talking about adults. Drinking is dangerous if you don't know how to control it, but you can't baby-sit people.
Kmiec believes that video gambling benefits everyone -- from customers who like the pastime, to local establishments and the state that get extra revenue. "This creates more business. Having a machine like this is no different from having a pool table. It's just a form to amuse your time," he said.
Video gambling banned hereHere are many of the towns in the suburbs that outlaw video gambling, which is also banned in unincorporated parts of Cook, DuPage, Lake and McHenry counties.
Round Lake Park