Since Gov. Pat Quinn (D) signed the Video Gaming Act into law in July 2009, the City of Chicago has chosen not to benefit from Illinois' authorization of slot-like video gaming terminals (VGTs). After sixteen years and a financial crisis in the Windy City, Mayor Brandon Johnson (D) is softening his stance.

In communities that haven't decided to outlaw such gaming, the Video Gaming Act permits retail establishments, eateries and taverns, truck stops, veteran's groups, and fraternal organizations to host the slot-like terminals. Truck stops can have up to ten VGTs, but most small enterprises can only have six.

There are currently about 50,000 VGTs in Illinois, and the games are available in the majority of the state's counties and cities. Chicago, the most populated city in Illinois, has always been the largest exception.

Johnson stated this week that he is open to the concept of permitting the gaming machines despite a heavy debt load, a serious pension obligation issue, ongoing budget deficits, growing expenses, and growing pressure from lawmakers to take VGTs into consideration. There isn't a single Republican on the 50-member Chicago City Council, which strongly supports Johnson.

The Impact of Bally

Chicago's economy will be saved by Bally's Corp. The company's approximately $2 billion proposal to transform the former Chicago Tribune printing facility into an integrated resort casino is now in the early stages of construction.

Although the company's temporary casino at the Medinah Temple has fallen terribly short of premarket projections, revenue from the Bally's casino and related resort operations is expected to play a key part in raising city finances.

The only casino in actual Chicago is Bally's. Some slot machine gamers may avoid the River West neighborhood, where the permanent resort will be located, if VGTs are permitted throughout the city.

Johnson isn't completely embracing VGTs because the state is the main beneficiary of the machines. He is, nevertheless, "open."

"I’m open. I’ll just say it like that, right, because the work that we have to do to continue to build a safe and affordable city requires us to make critical investments,” Johnson said of VGTs during a press conference this week.

“As long as people are willing to participate in that form of entertainment, it’s an opportunity for us to secure the revenue that’s needed,” Johnson reasoned.

The host municipality receives only 5% of a VGT's gross revenue, with the state receiving 30%. 64.08% of the proceeds are divided evenly between the host establishment and the terminal operator, with the remaining 0.92% going toward the Illinois Gaming Board's administrative expenses.

In contrast, roughly 12.3% of the Bally's casino gaming revenue goes to Chicago.

Chicago Already Gains From VGTs

Even though VGTs are prohibited in Chicago, the city nevertheless gains a lot from the slot machines that are available elsewhere in the Land of Lincoln.

The Local Government Video Gaming Distributive Fund and the Capital Projects Fund are supported by the state's VGT tax benefit. The former is accessible to all communities, whereas the latter is limited to municipalities that permit VGTs.

The Capital Projects Fund, which is run by the Illinois Department of Commerce & Economic Opportunity, was approved in 2020 as part of the state's "$45 Billion Rebuild Illinois Plan," the same legislative package that approved five rural casinos in the Chicago suburbs and Chicago's downtown casino.