Experts question Chicago-owned casino proposal

Maura Kelly

Thursday, May 22, 2003 | 9:46 a.m.

CHICAGO -- Mayor Richard Daley wants Chicago to be the first city in the country to own a casino, an idea so novel that critics aren't sure how it would work.

The mayor has said he would have an outside company manage the casino, but questions remain about how the casino would be regulated.

"Would the state threaten to shut down the city if there was cheating, the machines were rigged or executives were stealing money? It's strange," said gambling expert Bill Thompson, professor of public administration at the University of Nevada, Las Vegas.

Daley said he plans to push ahead with his idea despite Gov. Rod Blagojevich's vow on Tuesday to block any state budget that includes gambling expansion. The mayor said he was not disappointed by Blagojevich's announcement and will continue to make his case for a land-based Chicago casino.

"I'll just actively seek it," Daley said Wednesday. "We'll see what happens."

Monica Kearns, policy researcher at the National Conference of State Legislatures, said she is not aware of any casino in the United States that is owned by a state or local government except for tribally owned casinos, and she was not aware of any states or cities that are considering such casinos this year.

The mayor known for borrowing ideas from other cities and bringing them to Chicago -- from plastic cows on the streets to gondolas on the Chicago River -- wants to put his own twist on gambling. He says he's only interested in a casino if Chicago can own it, under the theory the city would rake in more cash than the typical arrangement in which government collects tax revenue from private casino owners.

"We need the revenue," Daley said recently. "There's no alternative out there if you talk about new schools, if you talk about parks. You have people telling you they want this, they want that -- how do you get it? You only get it by new revenue."

Daley's plan would require the Legislature to grant the nation's third-largest city a new, special license that would let Chicago own a land-based casino. The state currently only allows riverboat casinos.

The idea for a Chicago casino is among several proposals circulating during the waning days of the Illinois Legislature's spring session that would largely rewrite the state's gambling laws, but Blagojevich has said he won't support them.

Daley has not released any revenue projections for a land-based, city-owned casino. But state Rep. Lou Lang, D-Skokie, the sponsor of legislation that would allow a gambling riverboat in Chicago, estimates that a 4,000-slot floating casino would bring in up to $500 million a year in tax revenue for Chicago and about $380 million for the state. It's unclear if the competing ideas can be reconciled.

Supporters say a city casino will attract tourists and conventioneers who will gamble and spend money in restaurants and stores.

"It will round us out as a major convention, tourism city," said Jerry Roper, president of the Chicagoland Chamber of Commerce. "It will only enhance the experience of Chicago."

But critics say any Chicago casino would mostly attract local residents. Even if tourists or conventioneers came to a Chicago casino, their money would be spent gambling instead of at a baseball game or restaurant, others say.

"Casinos cannibalize existing businesses," said the Rev. Tom Grey, the Rockford, Ill.-based executive director of the National Coalition Against Gambling Expansion.