First video gambling machines running in St. Charles

Posted11/8/2016 5:15 AM

About a year after St. Charles officials reversed their ban on video gambling, a handful of establishments are hosting either a new vice or a new source of income for the city.

City officials received a report of video gambling activity in the city Monday night. Three establishments -- A' Salute, Dawn's Beach Hut, and Rookies -- began operating a total of 12 video gambling machines in September. Those 12 machines saw about $85,500 in wagering in September.

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There is a 30 percent tax on the net income from each machine, and St. Charles gets one-sixth of that for its cut. So far, that's pushed $369 of new money into city coffers.

The dollars still don't make sense to Alderman Rita Payleitner. She was the most vocal opponent to lifting the video gambling ban last year. She wanted it noted in the official record of a committee meeting Monday night that St. Charles aldermen have not had a direct role in licensing any of the businesses that have received the machines so far.

"We have not taken any votes," Payleitner said.

Aldermen don't need to. The lifting of the ban a year ago, featuring a tiebreaking vote by Mayor Ray Rogina, gave the city staff the authority to issue licenses to would-be video gambling operations. Opponents consider video gambling a vice that could attract crime to the city as well as fuel gambling addictions.

Since the initial three businesses, the city has approved four more establishments for video gambling: Alibi Bar & Grill, Alley 64, Riverside Pizza & Pub and the St. Charles Moose lodge.


There are now a total of 30 video gambling machines operating within the city.

Nine more establishments are seeking to add a total of 45 more machines. If approved, that puts the city well within its target of raking in at least $100,000 in new income by having at least 53 video gambling machines in operation.

An earlier report by the city staff showed municipalities with legal video gambling earn an average cut of about $1,880 per machine annually.

The city has the potential to host about 370 video gambling machines given the number of existing businesses that would qualify as gambling locations.

City officials have a top-end income estimate of about $700,000 a year in new income for the city.

Those dollars could be key to keeping the city's property tax levy freeze in place. Aldermen approved a preliminary 2016 property tax levy for operations of about $12 million. It's the same amount aldermen have levied since 2009.

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