Cities and counties in the region are missing out on almost a quarter of a million dollars in gaming revenue from July alone, because their share of revenue from video gaming has not been released during the state’s budget impasse between Republican Gov. Bruce Rauner and Democratic lawmakers.
Illinois municipalities and counties that allow video gambling in bars and restaurants won’t get their cut of profits from the machines until the state budget is in place, Rauner’s office has announced.
For metro-east communities, it means a loss — at least temporarily — of a handy financial crutch. The municipality or county gets a 5 percent cut of the net income for each video gaming machine. The state gets a 25 percent cut.
For example, Belleville’s cut for July was almost $16,000, Collinsville’s topped $10,000 and Granite City’s was about $12,500. The cut for St. Clair County, which gets revenue from machines in unincorporated areas of the county, was about $11,400.
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For municipalities and counties across the region, their cut for July was about $242,000.
Meanwhile, the bar and restaurant owners have been able to keep receiving their 35 percent share of the revenue from the video gaming machines in their businesses. They have relationships with a private vendor supplying the machines. The vendor gets the remaining 35 percent of the video gaming pie.
Belleville Mayor Mark Eckert said it’s “just disappointing” that municipalities are not getting their share of video gaming revenue. Belleville puts the the video gaming revenue into the general fund, which pays for the operation of the city.
“Any amount of revenue that we start to see as a regular source of revenue and now is being held up, affects the city,” Eckert said.
Belleville residents approved video gambling in the November 2012 election.
While Belleville is still waiting for its share of video gaming revenue, aldermen in the past week actually turned down a chance to increase their video gaming revenue.
The City Council voted unanimously to amend the video gaming ordinance to require that establishments derive at least 50 percent of their income from food and beverage in order to get a video gaming license. For example, a coin laundry or a parlor that primarily gets its income from the five gaming machines allowed under state law would not be eligible to get a license in Belleville.
Also, the aldermen prohibited stores that have a license for the retail sale of alcohol from getting a video gaming license.
Eckert said the city made the change to match the intent of the state law designed to allow video gaming in bars and restaurants. “It was never the intent to have just gaming parlors,” Eckert said.
Fairview Heights was supposed to receive more than $7,500 from the July revenue. City Administrator Jim Snider said the video gaming revenue goes into the city’s general fund to support overall operations.
“Although the delay in receiving our local disbursement is a concern, we are able to offset it with our reserves,” Snider said.
Troy Mayor Al Adomite, whose city is supposed to receive about $7,500 for July, said the holdup isn’t a big problem for Troy.
“I’m guessing that at some point we’ll be made completely whole in regard to those funds. It’s just a question of getting a legislative appropriation so they can cut loose the money,” Adomite said.
Adomite said Troy aldermen, when they voted to allow video gambling, decided to devote the revenue to causes that support veterans and the military. He said the city has spent about $5,000 so far on an effort to keep Scott Air Force Base. The city has another $100,000 or so in gambling revenue, according to Adomite.
“I’m sure there are some cities that have budgeted that money toward something, and that could be devastating for those towns,” Adomite said.
The Republican governor and Democrats in the state Legislature have been at a budget impasse for weeks. And the state doesn’t have the authority to distribute video gambling profits to municipalities across Illinois without a balanced budget, Rauner spokeswoman Catherine Kelly said in a statement.
A spokeswoman for Illinois Comptroller Leslie Munger said attorneys in her office are looking into the video gambling issue.
Without a state budget in place, Illinois isn’t able to pay many of its new bills. However, there are some exceptions.
The statement from Rauner’s office indicates his belief that video gambling payments won’t be among those exceptions. In the statement, the governor’s camp places the blame for the state’s inability to pass a balanced budget on House Speaker Michael Madigan “and the legislators he controls.”
But Madigan believes Rauner caused the budget holdup, and he argues that the governor could have avoided a partial state shutdown by making changes to the budget that Democratic lawmakers sent to him in May and leaving the rest alone.
“The person who had the singular authority to avoid all this was Gov. Rauner,” Madigan spokesman Steve Brown said.
The Associated Press contributed to this report.
Region’s July video gaming revenue
Prairie Du Rocher
St. Clair County