Some of the most important political leaders in Illinois are finally talking about passing a casino expansion bill. Chicago Mayor Rahm Emanuel has had discussions with Gov. Bruce Rauner, House Speaker Michael Madigan and Senate President John Cullerton about the need for such legislation, according to several news reports.
That’s the good news. The bad news is that they still can’t agree on who should own a Chicago casino and that the south suburbs have apparently been left out of the equation.
“I don’t believe that’s true,” said Ed Paesel, executive director of the South Suburban Mayors and Managers Association. “We had our Springfield trip last week, and we discussed the south suburban casino with state Rep. Robert Rita (D-Blue Island and the chief sponsor of casino expansion legislation) and our other elected representatives from the south suburbs.
“I can’t believe our legislators would vote for any bill that would not have a south suburban casino in it,” Paesel said. “Our mayors talked to their legislators and were assured that no casino expansion bill would pass out of the General Assembly without a south suburban casino in it.”
Paesel may be optimistic, but I am not.
Chicago mayors and Illinois governors, both Republican and Democrat, have a long history of working together to shaft the Southland. And our legislative delegation has a long history of complaining about that while bending to the will of those who run the state.
When Chicago politicians complain, people listen, even when their whining is almost laughable.
For example, there’s been a lot of whimpering recently by Chicago residents and public officials about the possibility of increasing property tax bills to fund Chicago Public Schools.
Chicago has the lowest composite property tax rate (that’s combining all the tax rates within the city) in Cook County. The county clerk’s office, which annually publishes a chart of tax rates, reports that Chicago’s composite property tax rate in 2013 was 6.8 percent.
Ford Heights, one of the poorest suburbs in the nation, had a composite rate for that year of 39.9 percent, Park Forest was at 32 percent and Chicago Heights at 29.9 percent.
Those three suburbs had the highest property tax rates in Cook County, but you can look anywhere outside of Chicago and find higher property tax rates in the county.
The reason is quite simple. For decades, suburban schools have been financed on the backs of homeowners. But Chicago gets piles of money in education grants from state government and has such a large commercial and manufacturing base that it has been able to fund its schools without the eye-popping tax rates the rest of the state has been struggling with.
Yet Emanuel complains about his residents also paying for the pensions of suburban and downstate teachers, and a casual observer would think that Chicago residents have been getting a raw deal.
Editorial writers act like a 2 percent tax rate hike for public education in Chicago would result in a massive wave of newly homeless people hitting the streets.
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Hey, the property tax system in Illinois is unfair. I’ve been screaming about that for 20 years. But Chicago politicians never seemed to care because the system worked for the city, and the rest of us ended up paying more in property tax than we did on our mortgages.
I mention all of this to note just one way in which the interests of Chicago sway public policy and have a negative impact on the rest of us in Illinois.
But back to the nonsense over casino expansion.
Rita has proposed two bills — one creating a giant casino in Chicago and the other creating five new ones, including a smaller Chicago casino and a casino in the south suburbs.
Rita always has said his bills are a starting point for discussion, but Chicago ought to have a mega-casino and there ought to be at least four new ones elsewhere in Illinois.
The Chicago casino ought to be twice the size of any other in Illinois because the city draws tourists from throughout the world and is also a major convention center. It can attract more money from out-of-state gamblers than any other casino in the state and should be given the opportunity to make every dime it can.
But Illinois residents, including people living in the south suburbs and on the South Side of Chicago, have been keeping casinos in Northwest Indiana profitable. These are people who aren’t likely to make the trip downtown. This is money that could be going into the state treasury but instead is going to help Indiana.
A gambling industry public relations firm, representing clients who want to open a casino in the Southland, reports that Illinois residents spent about $790 million at Indiana casinos last year. They spent a total of $1.75 billion at casinos there and in other neighboring states.
The claim is that’s more money than all the wagers placed at Illinois’ 10 casinos by Illinois residents in 2014.
I don’t take those numbers at face value, although anyone who has visited the Horseshoe Casino in Hammond will tell you that the vast majority of cars in its lot have Illinois license plates. Four casinos in Indiana and Michigan have a total of 18 pick-up locations in Illinois so they can ferry gamblers to their sites.
The Ameristar casino in East Chicago, Ind., had 1.2 million admissions in 2014 and the Horseshoe had 2.1 million, with those two casinos generating more than $90 million in tax revenue for Indiana, according to the Indiana Gaming Commission website.
If 70 percent of that came from Illinois gamblers — the typical estimate of casino industry sources interested in building a south suburban venue — that would mean $62 million that might have gone into the Illinois treasury.
If five new casinos do get built, that could mean more than $1 billion in new development before a penny gets wagered. That means jobs for construction crews. That means people with money to spend at stores and taxes flowing into the Illinois economy.
As I mentioned in a column earlier this week, Illinois is facing a roughly $6 billion budget shortfall, and programs that help people are facing massive cuts. I think elected officials owe it to those people to do everything in their power to plug that budget gap. Casino expansion is one of the easiest ways to make an impact on that deficit.
“There is more movement regarding casino expansion bills than I’ve seen in the past,” Rita said Tuesday, the day after a public hearing on his legislation.
He said he was unaware that Emanuel, Rauner and Madigan had been talking about a Chicago casino, but he has now been contacted by representatives of the governor and the mayor, indicating an interest in moving a bill forward.
Rita acknowledged that those discussions have focused on a Chicago casino.
“But I haven’t heard anything or seen anything that would rule out a south suburban casino,” he said. “The south suburban casino is still a possibility. Nothing has changed.”
I’ve quoted the gambling czar of Indiana in the past. He has assured nervous Indiana casino operators that they have nothing to worry about when it comes to competition in Illinois. Our political leadership can’t agree on anything, he has told them, and even when they do agree they tend to screw things up.
Worry about competition from Kentucky and Michigan, he has said, adding that “one of our advantages to Illinois is they, historically, seem to do everything wrong. Everything they seem to do has backfired, and it has been to our benefit.”
Rauner is a big fan of how they do things in Indiana. Well, one thing they do very well is cater to the needs of casino gamblers in the south suburbs of Illinois.
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