Lawmaker: Resolution needed on rift between casino, horse track

News-DemocratMay 12, 2014 

Casino Queen

The state lawmaker trying to put together a gambling expansion bill is urging metro-east legislators to help fashion an agreement between the Casino Queen in East St. Louis and the Fairmount Park horse track in Collinsville.

Rep. Robert Rita, in a letter sent Friday to metro-east legislators, said the rift between the casino and the horse track is something "that we must resolve in order to move forward with gambling-expansion legislation" before the General Assembly ends its spring session in three weeks.

But it's not just the casino and the track at odds. Complicating the issue is a disagreement over how to distribute the tax revenue to communities if Fairmount Park is allowed to install slot machines.

Perhaps as a nudge, or perhaps as a warning, Rita brought up two points in the letter:

* Rita said Rep. Dan Beiser, an Alton Democrat, has now raised concerns about whether the Argosy Casino in Alton would also suffer if Fairmount Park gets slot machines.

* Rita said a study conducted for the Missouri Gaming Commission in 2010 suggested the St. Louis/metro-east gaming market is already saturated, and more gambling venues could lead to "cannibalization" of revenues and patrons.

Rita, a Democrat from Blue Island, said in the letter: "So along with the very real concerns that allowing slots at Fairmount will simply shift gambling revenue away from the Casino Queen, we have to weigh whether the St. Louis market is already oversaturated as this Missouri regulator report suggests."

During legislative hearings earlier this year on whether to expand gambling in Illinois, representatives of the Casino Queen said their revenue would take a big hit if Fairmount Park gets slot machines. The casino was backed by several city leaders from East St. Louis, who noted the city gets about 40 percent of its revenue from Casino Queen taxes.

So Rita has put together legislation that would allow slot machines at four other horse tracks in Illinois, but not Fairmount. He has said he's willing to include Fairmount Park in the legislation if the track and the Casino Queen can reach some type of agreement.

Rita, in an interview Monday, said it's up to the casino, the cities and the track to come up with acceptable terms of an agreement.

"Maybe there's a way they could do something with revenue-sharing, or reduced slots at Fairmount (compared to other tracks)," Rita said. "There's a number of options."

Rep. Dwight Kay, R-Glen Carbon, said there's a dispute over how taxes from the race track's slots should be dispersed. One proposal calls for 45 percent to go to East St. Louis, 45 percent to go to Alton and 10 percent to go to Collinsville. Kay favors a distribution of 50 percent to Collinsville, 25 percent to East St. Louis and 25 percent to Alton.

Kay said Rita seems "very determined to shut the doors at Fairmount."

Fairmount officials say it's not fair to single them out from the state's other tracks. And some observers have suggested that legislation favoring some tracks over others might not hold up in court.

"I don't want to speculate what a court would rule on the constitutionality of it. I would like a compromise, rather than going to a court," Rita said in the interview. He added that a compromise, rather than litigation, would be best for everyone involved.

Fairmount Park says it needs revenue from slots so it can offer competitive race purses. The track says horse owners are opting to race in other states, where slot revenues fatten race purses.

Fairmount supporters say the track's very survival is at stake. The track says it has about 400 employees, and accounts for about 600 spin-off jobs.

Rita is offering two options in his current bill. One is a plan to add five casinos, including one in Chicago, plus slots at racetracks (600 slots at each track in Cook County, and 450 slots at tracks outside Cook County, except for Fairmount). The other plan calls for only a state-owned casino in Chicago.

Existing casinos oppose the gambling-expansion plan, saying they're already facing significant revenue losses from slot machines at bars, restaurants and clubs, which were legalized last year.

Rita, in the letter, said he is "not drawing any immediate conclusion" from the Missouri study.

He told the fellow lawmakers, "We all need to take another look at the expansion proposals and examine what is the best way to proceed."

Contact reporter Brian Brueggemann at bbrueggemann@bnd.com or 239-2511.

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