Illinois Gov. Rod Blagojevich may be in a tough fight to keep his job but he can claim one distinction: it was his idea to raise the gaming tax to 70%, highest in the nation.
The gaming industry reacted immediately by refusing to promote their activities or expand their properties in any way. Still, Illinois set a gaming tax collection record.
The law was scrapped last year with the understanding that if by dropping the tax to 50% the state fell behind the previous year in its tax collection, the casinos would make up the shortfall.
Actually, riverboat gaming taxes were $10 million below the previous year’s number so the state invoked a "hold harmless" provision of the law that reduced the taxes so the state budget wouldn’t be affected. However, the "hold harmless" provision expires at the end of the year and casino interest are fighting to prevent the legislature from re-establishing the provision for a second year.
Now, Blagojevich has come up with another idea to enhance the state’s coffers through gambling, and, for that matter so has his opponent, state Treasurer Judy Baar Topinka.
Blagojevich wants the state to sell or lease its state lottery, saying the price for the enterprise would reach $15 billion.
Topinka believes the way to create more gaming tax dollars is by building a mega-casino in Chicago and approving more gaming positions at the state’s licensed riverboats.
With sales approaching $2 billion, the state lottery generated more than $670 million in profits that were applied to the state’s schools, an increase of more than 9% over fiscal 2005.
As for the Chicago casino, that has been one of Gov. Richard Daley’s pet projects, although it has been strongly fought by gaming opponents.