Wednesday, May 12, 2004 | 8:58 a.m.
CHICAGO -- Attorney General Lisa Madigan blocked a proposed deal Tuesday that would have put the state's 10th casino in Rosemont, saying gambling regulators didn't completely answer her concerns about the operator or the location and that litigation threatened to stall the deal for years.
Minutes earlier, Gov. Rod Blagojevich had announced in Springfield that he opposes Chicago Mayor Richard Daley's proposal to build a casino near downtown Chicago and would veto any legislation that called for one.
The Democratic governor did not rule out adding casinos elsewhere, however.
Blagojevich said that gambling in Illinois is limited to a few cities that need an economic boost and that a giant casino in downtown Chicago would be a fundamental change. The state currently has nine operating casinos, four of them on the outskirts of Chicago but none in the city.
State law currently allows 10 casino licenses. Only one is unused, the license held by now-bankrupt Emerald Casinos, which had planned to build in Rosemont.
Since 2001, the Illinois Gaming Board has been trying to revoke Emerald's license over concerns about the company and Rosemont's possible mob ties. Madigan eventually approved a settlement allowing Emerald to sell the license, but questions arose again when the Gaming Board approved Isle of Capri Casinos' bid to buy the license even though it, too, planned to build in Rosemont. That led Madigan on Tuesday to blocking the sale and resume the license revocation hearings.
"The Illinois Gaming Board ignored specific safeguards written into the plan to ensure that the playing field for all potential bidders was not tilted toward Rosemont based on previous failed attempts to locate there," Madigan said. "The Illinois Gaming Board also disregarded the recommendation of its professional staff. And the Illinois Gaming Board failed to explain how it grew comfortable with Isle of Capri as an operator and Rosemont as a location."
Madigan said she had notified Emerald that the hearing aimed at revoking Emerald's license will resume. The state must give Emerald 60 days notice of its intent to resume the hearing.
If she succeeds in revoking the license, that state could then reissue it to another casino company.
Madigan said it would be up to Blagojevich's office to decide if it wants to continue with an investigation the governor commissioned into the board's decision to place the casino in Rosemont. Abby Ottenhoff, spokeswoman for the governor, said the investigation would be dropped.
"There's no need for an investigation into a license deal that's not going to go anywhere," she said.
Blagojevich, who ran for office on a promise to oppose gambling expansion, made it clear Tuesday that a casino license would not involve a gambling operation in Chicago. He said that he would, however, entertain other gambling proposals if lawmakers first looked for other ways to balance the state's expected $1.7 billion budget deficit.
"I oppose it because when it comes to the state budget there are no quick fixes," Blagojevich said. "It's not my vision for the kind of state Illinois should be."
Blagojevich also repeated his long-standing opposition to legalizing video poker. But he refused to take a position on adding riverboat casinos in depressed areas, such as Waukegan, the south Chicago suburbs or Rockford. He also refused to discuss the idea of slot machines at horse racing tracks.
"We're not offering to make any deals about anything right now," he said.
Daley was out of town Tuesday, and his press office did not have an immediate response to Blagojevich's remarks, said spokeswoman Rosa Escareno.
The Chicago mayor announced Monday, after weeks of speculation, that he would ask the Legislature to pass a law allowing the city to build its own land-based casino. He said a casino near downtown could bring the nation's third-largest city as much as $300 million a year in revenue, with the state getting as much as $700 million a year.
He had called it a bold step, saying such moves were needed to keep Chicago moving forward in uncertain economic times.
Senate President Emil Jones, D-Chicago, said that despite the governor's comments, he would push forward with legislation for a major gambling expansion, including a Chicago casino. State lawmakers were expected this week to propose new casinos in Chicago's south suburbs and north of Chicago.
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