Friday, May 21, 2004 | 9:02 a.m.
SPRINGFIELD, Ill. -- Gambling supporters say a massive expansion plan to allow four new casinos in Illinois -- including the first in Chicago -- would solve a $1.7 billion hole in the new state budget. But they're betting on several unknowns, including just how quickly the state might see the money.
Not even the Illinois Gaming Board can say how long it would take to bid out four new licenses, properly investigate the winners and get the license fees into state coffers.
A suitability review alone takes the board about three months, and the board says it would need to nearly double its staff to deal with four at once. Gov. Rod Blagojevich has vowed to veto a casino in Chicago, which, even if lawmakers override that veto, would likely delay the start of the process. And experts say followup lawsuits could be unavoidable.
Consider the case of Rosemont and the license held by now-bankrupt Emerald Casino. Lawmakers in 1999 approved the company's idea to move a casino to the Chicago suburb of Rosemont, but lawsuits and questions from regulators tied it up in court. Five years later, the license is still in legal limbo.
Even ardent supporters acknowledge there's more work to be done, while skeptics warn that betting on such a large revenue boon during the next fiscal year is risky.
"It's all speculation," Senate Minority Leader Frank Watson, R-Greenville, said.
The gambling expansion plan headed to the Senate would include four new casinos -- in Chicago, Waukegan, Rockford and a suburb south of Chicago -- plus thousands of new gambling positions in the current casinos and slot machines at horse tracks.
Advocates say it would bring the state $1.8 billion and fill the budget gap without a need to cut state services or to increase taxes and fees, as Blagojevich has proposed.
The measure would require the new casino license winners to pay at least $350 million up front, generating $1.4 billion. The remaining $400 million would come from new gambling positions, such as slot machines at the nine existing riverboat casinos and for the first time at horse tracks, that could be making money by the end of the next fiscal year, which runs July 1 to June 30, says sponsoring Sen. Denny Jacobs.
Jacobs, D-East Moline, predicts the Gaming Board could auction off the new licenses, conduct background investigations and have new casinos operating in temporary locations by the last third of the fiscal year while permanent facilities are being built.
But getting that accomplished could be highly complicated, gambling experts say.
There could be snags in selecting the new licensees, such as lawsuits from competing companies or gambling opponents. In the case of Chicago, Mayor Richard Daley wants the city to own the casino, something that has never before been done in Illinois. Allowing temporary casinos would also be new.
Who gets each license would be based largely on the highest bidder, compared with when the state's current 10 casino licenses were first sold in the 1990s and recommendations from participating cities carried significant weight, Jacobs said.
The quickest a casino has been up and running in the state so far is the 15 months it took the Grand Victoria to open in Elgin in 1991, but temporary casinos could cut that time.
If a temporary facility was allowed and regulators moved quickly, Gaming Board Chairman Elzie Higginbottom said Chicago could have a temporary casino running within 10 months.
But Gaming Board spokesman Gene O'Shea said the board estimates it would take 100 new personnel to first investigate the applicants and then regulate four new licenses at once, nearly double the 127 staff members the board has now.
"If they create four at one time, we're going to be hard pressed," O'Shea said. "We're dealing with a lot of unknowns."
The head of the group representing riverboat casino owners agreed novelty means uncertainty.
"There's a lot of things going into this," said Tom Swoik of the Illinois Casino Gaming Association. "It's going to be looked at closely."
And one Statehouse veteran says it's wise to be cautious with the numbers.
"It's impossible to be precise," said Mike Lawrence, a professor at Southern Illinois University at Carbondale who was spokesman for former Gov. Jim Edgar. "You do have to question how quickly these boats would come online."
Rep. Lou Lang, a Skokie Democrat pushing a similar expansion proposal in the House, said gambling can provide a worthy payoff even with snags.
"Even if they're off and we only get 20 percent of what we estimate, it's still worth doing because it's money we didn't have before," Lang said.
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