Comments of Tom Swoik, Executive Director
April 9, 2003

Indiana, Missouri and Iowa must be jumping for joy. They are the real winners with the casino tax increases proposed today by Governor Blagojevich.

Their casinos already are drawing more customers and tax dollars away from Illinois because they are able to offer more slots and games, and because their lower tax rates leave them with more money to invest in marketing programs. Today's proposed across-the-board increases in gaming tax rates are coupled with a new top tax rate of 70 percent that would make Illinois' casino taxes twice as high as anywhere else in the country. This will result in Illinois exporting even more gaming patrons and potential tax revenue to neighboring states.

The Governor has made it clear that proceeds from the sale of the 10th casino license are vital to the state budget, yet increasing gaming taxes for the second time in two years completely undermines that goal. Financial analysts have estimated that the value of the license fell from nearly $600 million to $350 million after last year's increase made Illinois gaming taxes the highest in the nation. With this new tax hike on riverboat casinos, the 10th license will go for bargain basement prices and not the $350 million the Governor used in the budget.

There is a better way to achieve the Governor's revenue goals. While these new taxes proposed today would yield an estimated $200 million a year in new revenues, the Illinois Casino Gaming Association has proposed a plan, the "Better Deal for Illinois," that would generate $365 million a year in new revenues while at the same time stimulating the Illinois economy.

This gain in tax revenue would be achieved through additional gaming positions at existing casinos and a restructuring of tax rates to encourage industry growth through investment in new facilities, jobs and marketing programs.

A University of Illinois study has predicted that the casino industry's proposal would create 26,000 new permanent jobs and $2.2 billion in economic activity - an economic stimulus the state can't achieve simply by raising casino taxes.

Surely the Governor does not intend to discourage investment in a casino industry that is so vital to the state's fiscal and economic health, but that's exactly what these tax increases will do. We will be meeting with the Governor's representatives and state legislators in coming days and weeks to talk about better ways to make sure the riverboat casino industry remains a healthy, vibrant contributor to the Illinois economy