Lawmakers consider dropping admissions tax for some casinos
Lawmakers are considering whether to let the Par-A-Dice and Illinois' other riverboat casinos stop paying a $3-a-person admissions tax that sends money to state government and the municipalities where casinos are based.
The Illinois Senate voted this week for a measure that would lift the admissions tax on casinos that made – or will make – capital investments worth at least $45 million at any time after Jan. 1, 2006.
To help make up for the loss of the admission tax dollars, the legislation would boost by 1 percentage point the tax that casinos pay on adjusted gross receipts, which is the money they collect. At present, that wagering tax varies among the casinos, depending on the amount of their gross receipts. Local communities receive a portion of the tax on receipts.
House Bill 261 cleared the Senate on a 40-13 vote Tuesday and heads to the House of Representatives. If approved there and signed by the governor, it would become law.
Supporters of the legislation say it would help the Illinois casinos thrive, which in turn would benefit the state and local governments that share in the casinos' success.
"I believe in the end it will encourage operators to invest more in their casinos," said Sen. Mike Jacobs, D-East Moline.
He said four casinos, the Joliet Empress and casinos in East St. Louis, Rock Island and Metropolis, already would be able to end the admissions tax because they've made at least $45 million in capital improvements.
David Strow, a spokesman for Par-a-Dice owner Boyd Gaming, said the company supports the legislation, though the East Peoria casino has no immediate plans for a major expansion.
"We believe it would be a positive step toward encouraging future capital investment," Strow said. "It would certainly be a factor we take into consideration as we look at future investment opportunities."
East Peoria city administrator Tom Brimberry said the admissions tax generates about $670,000 each for the cities of East Peoria and Peoria every year.
He said while East Peoria would be concerned about the possibility of losing the admissions tax money, it "would be pleased to see legislation that would encourage the Par-a-Dice and other gaming facilities to expand and invest in capital projects."
The Par-a-Dice is the only casino in central Illinois.
Jacobs, who is the bill's Senate sponsor, said he expects that casino revenues to local communities would be "very similar to what they get now" if the proposal becomes law. He said he would revise the legislation if it turns out there's a sharp drop in revenue to the communities.
Gambling opponent Anita Bedell, who heads Illinois Church Action on Alcohol and Addiction Problems, criticized the proposal as an undeserved reward for casinos.
"When the state is already over $11 billion short in (its) budget, why do they want to give a tax break and bail out the casinos?" she said.
City officials in some of the casino communities said they weren't familiar with the legislation.
"I would have to find out more about it," said Metropolis Mayor Billy McDaniel. "Unless they can assure us of some other form of payment, certainly I wouldn't be for it."
Metropolis' operating budget "is wrapped around gaming revenue," McDaniel said, adding that his city has used that money to build new police and fire stations and a water filtration plant.
Rock Island Mayor Dennis Pauley took office just a couple of weeks ago. Before supporting the legislation, he said, he'd want to guarantee that his city continues to receive at least as much money as it does now.
Adriana Colindres can be reached at (217) 782-6292 email@example.com.