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News
Oswego Board says 'No' to video gambling : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, IllinoisOswego Board says 'No' to video gambling
| Local bar and tavern owners had urged board to permit machines
| by John Etheredge
| 7/19/2012
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Gambling has been outlawed in the Village of Oswego since at least 1935 and it will likely remain so for the foreseeable future.
In a split 3-2 vote Tuesday evening, board members rejected a motion to repeal a 1935 ordinance that prohibits gambling in the village.
The board needed to repeal the ordinance as the first step towards permitting video gambling in local businesses.
Board members Tony Giles, Scott Volpe and Jeff Lawson voted against the motion, while board members Gail Johnson and Judy Sollinger cast favorable votes.
Board member Terry Michels voted "present" on the motion.
A small group of village tavern owners who support video gambling watched from the gallery at village hall as board members cast their ballots.
To help pay for a statewide capital improvement program, state lawmakers voted in 2009 to allow video gambling in businesses across the state that are licensed to serve alcoholic beverages.
In a memo to the board Jeanne Hester, village clerk, noted that each video game machine is subject to a tax of 30 percent on its income. A total of five-sixths of the tax revenue generated by each machine would be placed in the State's Capital Projects Fund, while one-sixth would be deposited into a Local Government Video Gaming Distributive Fund.
According to Illinois Municipal League (IML) estimates, businesses with five video gaming machines would generate an estimated $11,250 in tax revenue for local municipalities annually, Hester noted.
Hester wrote in her memo there are an estimated 10 businesses in the village that would potentially be interested in offering video gaming machines and each would be allowed to have up to five machines.
"That equates to a maximum of 50 video gaming machines allowed by the state. At the current (municipal) licenses fee of $100 per machine, the village would realize about $5,000 in license fee revenue...Those same 50 machines, using the IML estimates, would bring in approximately $112,500 in tax revenues from the state; this more than makes up for any increase in fees that the village would adopt."
During a committee meeting last week, owners from four local businesses licensed to serve alcoholic beverages encouraged board members to permit the video gaming machines.
They charged their businesses will lose customers to neighboring communities like Yorkville which have already approved video gaming.
Pat Burke, owner of Nick and Pat's on Station Drive, told board members that a number of small restaurants and taverns will not be able to exist without the machines.
He also reminded board members that the law limits the maximum payout from the machines to $500.
Burke cited studies that show between 60 to 70 percent of the people who play video gaming machines are mature women.
He continued, "If Oswego does not have video gambling we will lose people to Yorkville and surrounding communities."
Burke said people will travel to restaurants and taverns in other area communities not only to play the machines, but also to eat and drink.
"People who don't play them (video gaming machines) will still go elsewhere because action breeds action," he said.
Burke also cautioned board members the village may stand to lose more revenue than they currently expect if they prohibited video gambling.
Noting that some of the national chain restaurants that hold liquor licenses are considering allowing video gambling, Burke said, "The five percent (revenue) the Village of Oswego will receive could be very big...I think it could be in the hundreds of thousands of dollars that you would be passing on that you would not have."
Debbie Krzeminski, owner of the Oswego Inn, also urged the board to permit video gambling.
Krzeminski agreed with Burke that the village and its businesses would lose revenues to Yorkville if the board does not allow video gambling.
"We have done everything we can to keep our door open amidst this bad economy," she said.
"We urge you not to look at it as gambling where thousands of dollars are lost and people are going to be derelict and we'll need Gamblers' Anonymous. That's not what we are doing," Krzeminski said, adding, "We are providing an entertainment that people want. They want to be able to put their $5 and $10 into a machine...and entertain themselves."
If the board rejected video gambling, Krzeminski said, "You'll be taking away our customers. They are going to go to Yorkville where it has been approved. You are going to be taking away the lunches and the dinners we serve. We will end up going out of business and I don't think this town can afford to have another business go out on Main Street."
She added that the Oswego Inn is "doing everything we can as a businesses to bring people down to Main Street by having good activities like car shows to promote the downtown."
John Schwartz, manager of the Oswego American Legion Post 675, agreed with Burke and Krzeminski.
Schwartz said Legion officials are concerned that veterans will go to other Legion and VFW posts in neighboring communities where video gaming is allowed-if it is not allowed in the village.
Responding to the business owners' comments, Johnson said she believes the board should allow citizens to decide how and where they want to spend their money.
"We constantly come back to the point that individuals should have rights and the right to choose where to spend their money is one of those (rights)," she said.
Johnson said she also believes small businesses-especially those that are dependent upon the sale of alcoholic beverages and "pub food" need revenue from additional sources.
"The restaurant business has the biggest failure rate of any business. It's a tough business," she said, adding, "From that standpoint, I support their right to have these machines, especially since the state gaming board will provide the oversight. There is very little that we will have to do."
Also, Johnson said, permitting video gaming would financially benefit the village.
"While this (revenue) may not be huge, it may be enough for an extra staff position or a facade grant or for replacement (parkway) trees," she said.
"I don't think this is going to be harmful to our community," Johnson said, adding, "I'm trying to find evil here and I'm not seeing it."
Sollinger said she supported video gambling because it would help local businesses.
"One of the things we all campaigned on is helping small businesses and keeping small businesses in town, she said.
Referring to video gambling, Sollinger said, "I think we should do this."
Lawson noted he is a regular customer at Nick and Pat's, the Oswego Inn and the former Riley Finns, and he "understands all the arguments" but said he remains opposed to allowing video gambling.
Lawson said when he wants to gamble he visits the casinos in Aurora or Joliet.
"That's where I go," he said.
Lawson, however, said he is concerned by talk that some bars and restaurants in the village might go out of business if the board does not allow video gambling.
Prior to the board's vote during Tuesday's meeting, Lawson asked LeClercq what he thought of repealing the 1935 ordinance.
LeClercq said he has questions concerning the sale of Illinois Lottery tickets and local civic groups and others conducting raffles as fund-raisers since gambling has been outlawed under the 1935 ordinance.
Karl Ottosen, an attorney for the village, said he believes there is a pre-emption clause in state law that permits the sale of lotto tickets in communities like Oswego that have banned gambling.
Concerning raffles being conducted in the village, Ottosen said gambling is illegal under village ordinance.
In making the motion to repeal the 1935 ordinance, Johnson said board members had heard from "five businesses, four residents and two business people" all in support of allowing video gambling.
Johnson added she had received a packet from an organization opposed to gambling, but had not heard any objections from village residents.
"I strongly support someone's right to spend their money where they want," Johnson said.
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