O’Fallon City Council will vote to close loopholes in city’s video gaming ordinances

An effort to tighten a perceived loophole in O’Fallon’s video gaming permit ordinance has advanced for final approval, possibly at the Feb. 20 council meeting.

The update further outlines the pre-conditions, including a minimum 50% food and beverage gross revenue requirement, which does not include fraternal or veterans’ establishments.

It sets a minimum time period for having a liquor license and the retail business must be compliant with zoning ordinances.

Currently, a new business has a six-month grace period where revenue can be evaluated, but what if an established business wasn’t meeting the 50% requirement, and then reapplied with a new name or new owner? Would they receive another six-month grace period?

The amended ordinance closes that loophole, assistant city administrator Grant Litteken said. The city attorneys changed the wording after it was discovered.

Assistant City Administrator Grant Litteken explained to the council’s finance committee on Jan. 22 that this ordinance may prohibit future gaming parlors and gaming establishments from opening in O’Fallon, and further restricts video gaming cafes.

The ordinance, which has been in place for about six years, is designed to prevent commercial businesses from having a stand-alone gaming parlor that sells “incidental” food and drink.

“It was meant to be ancillary use, only in support after food and beverage, that’s why the 50% ratio is in there,” Litteken said.

The city is unwavering about a business that applies for video gaming licenses that must have had a liquor license for two years already.

If the council wanted to make it easier and quicker, that is their prerogative, City Administrator Walter Denton said, but the council that created the original ordinance did not want a proliferation of gaming parlors. But they wanted to make it easier for charitable organizations.

“We do serve as a model ordinance for many of our neighbors,” Litteken said.

If the council wants to define more points, in terms of business expansion and ownerships switching hands, Alderman Jessica Lotz suggested that they follow up at another time. The ordinance, as presented, moved forward.

Litteken said they can update the ordinance depending on the current/future business atmosphere.

Annual nonrefundable video gaming licenses cost $1,000 per retail terminal in O’Fallon, and $250 for fraternal and veterans organizations.

The permit fee must be paid at the time of the initial or renewal application is filed with the city, and good until April 30.

According to the 2024 fiscal year budget, $240,000 was projected for video gaming terminals.

At Monday’s council meeting, Aldermen Todd Roach sought more clarification and Ross Rosenberg suggested tabling it for further discussion, but the city attorney recommended council action on first reading, and then changes could be made before the ordinance is up for adoption.

The ordinance also removed truck stops from being eligible for video gaming terminals.

To consider a video gaming café, the amendment seeks the following information:

The layout and design of the establishment, the preparation and variety of food and beverages offered, the creation and operation of a commercial kitchen, the number of video gaming machines relative to the customer seating capacity of the establishment, square footage of space devoted to video gaming relative to the amount of space devoted to other activities, the source of proposed or actual revenue derived from the establishment, the number of employees at the establishment and their proposed function, and any other factors determined as relevant by the Local Liquor Control Commissioner.

The next council meeting will be Tuesday, Feb. 20, because of the Presidents’ Day holiday on Feb. 19.