Progress Illinois

Some Illinois lawmakers just won't give up on gaming.

Although House Democrats nixed Gov. Rod Blagojevich's proposal to fund a capital program through gambling expansion, it's long been a go-to option for Illinois lawmakers looking to generate revenue without increasing taxes. But while our representatives in Springfield repeatedly return to the gaming well, they've forgotten to provide for the problem gamblers who account for at least a third of the receipts. Joseph Ryan at the Daily Herald has the goods:

A Daily Herald review of the state's casino industry reveals that Illinois falls far short compared to other states in helping gambling addicts even though their tremendous losses bolster the state's bank account, allowing lawmakers to avoid unpopular tax hikes.

This has left a safety net riddled with holes for a projected 384,622 adults in Illinois who are problem or pathological gamblers. [...]

Between 1995 and 2007, the state took in a total of $13.5 billion from legalized gambling and spent $7.3 million on treatment or awareness campaigns.

How do other Midwestern states deal with the problem? Indiana, Michigan, and Iowa all set aside between three or four times as much as Illinois for treatment, research, and awareness. In Minnesota, for example, devotes $2.5 million to treatment and research, allowing a problem gambler to receive inpatient treatment free of charge. In Illinois, a similar 90-day treatment program would cost the patient nearly $30,000, which few gambling addicts can afford.

The saddest part of this whole mess is that gaming isn't even a valuable revenue generator, as Ralph Martire, executive director of the Center for Tax and Budget Accountability, explains in his State Journal-Register column today.

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Back in April, Mose noted the contrast between Illinois -- where lawmakers continue efforts to expand gambling -- and numerous other states across the country that have retreated from gaming as a cure-all for their budget woes. Today, the Tribune reports on a new study from the Rockefeller Institute which provides yet more evidence that gambling is waning as a dependable revenue source. Indeed, proceeds last month from Illinois' nine casinos were apparently "down 14 percent from May 2007." The article quotes one of the report's authors singling out Illinois' dependance on gaming revenue, while noting that it's not "a real winner ... in the long term":

Whatever the reason, study authors say states shouldn’t rely on gambling as a growth stream, given their findings.

Illinois counts on gambling for about 4 percent of its state revenue—a figure nearly double the national average of 2.3 percent, according to Robert Ward, deputy director of the Rockefeller Institute and co-author of the study.

“States have become very reliant on gambling revenue, Illinois more so than most,” Ward said. “Adding gambling operations can help solve short-term budgetary needs. It’s not going to be a real winner of a solution in the long term.”

While the Illinois Gaming Board considers allowing riverboats to stay open 24 hours and Rep. Lou Lang (D-Skokie) hints at more casino licenses on the horizon, many states are taking a step back from expanding legalized gambling. In an article in the New York Times Magazine, Christopher Caldwell reports that Massachusetts lawmakers have decided against allowing gambling in their state, and that an effort is underway in the Maryland State Senate to limit gaming there as well.

While criticism of gambling is often morally-based, Caldwell reports that the current skepticism stems from questions over whether state-sponsored casinos actually represent significant revenue sources:

Introduce casinos in Massachusetts, and you will indeed recapture some of the hundreds of millions of dollars that Bay Staters drop in the resorts of Connecticut. But you will also capture a lot of money that people would have spent in local restaurants and movie theaters. The infrastructure required for gambling — from road building to hiring new police — is costly as well. Once you make those adjustments, the economic upside of gambling evaporates. The economist Earl Grinols estimates the ratio of gambling costs to gambling benefits at higher than three to one. Voters sense this. The rule of thumb, according to Grinols, is that pro-gambling interests lose referendum battles whenever they do not outspend their opponents by at least 75 to 1.

It's even harder to offset the economic toll of all the required infrastructure when gambling proceeds are falling in your state, as the latest Illinois Gaming Board Monthly Riverboat Casino Report (PDF) indicates.

(More after the jump ...)

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