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FOR IMMEDIATE RELEASE
June 25, 1999

GOVERNOR SIGNS GAMING LEGISLATION; RECOMMENDS INDUSTRY REFORMS

ROCK ISLAND -- Governor George H. Ryan today signed legislation designed to provide substantial economic benefits to areas throughout Illinois.

Senate Bill 1017 enhances the state's current gaming laws to allow Illinois Riverboats to conduct dockside gaming and enable the state's one dormant license to be renewed and relocated, producing additional revenues for the state's ailing horse racing industry and the Education Assistance Fund.

Ryan also unveiled a number of administrative safeguards that he intends to see implemented, including the appointment of two new Gaming Board members with extensive backgrounds in law enforcement and criminal prosecution and the recommendation of a former Assistant U.S. Attorney as the new Gaming Board Administrator.

"This bill is about economic opportunity and making sure Illinois gets its fair share of the revenues generated by riverboats," Ryan said. "Right here in Rock Island, we've been forced to watch Illinois dollars go across the border because of operating restrictions placed upon our riverboats. With the new dockside provision, the Rock Island boat will have the opportunity to succeed -- and that translates into economic revitalization for this entire region.

"But we must do all we can to make sure that the economic benefits of this legislation are supplemented with proper safeguards to ensure the integrity of the gaming industry."

Citing competition from other forms of state-sanctioned gaming as contributing factors to the recent decline of the horse racing industry, Governor Ryan praised Senate Bill 1017 as an appropriate solution. "The horse racing component of this legislation will pump new life into the racing industry and the jobs it supports in every part of Illinois. The survival of the racing industry is important to families throughout the state, especially the workers who lost their jobs when Arlington International Racecourse closed. Provisions in this bill will enable Arlington Heights' world-class facility to reopen and put people back to work."

The main components of Senate Bill 1017:

  • permits riverboats to conduct dockside gambling.
  • repeals the prohibition against riverboat gaming in Cook County.
  • allows the dormant Silver Eagle license to apply to the Gaming Board for renewal and relocation to a new site.
  • requires the relocated boat to attain at least 20% minority or female ownership. .
  • creates the Horse Racing Equity Fund financed by annual deposits of 15% of the adjusted gross receipts from the wagering tax imposed on the relocated license.
  • appropriates 2% of the adjusted gross receipts from the wagering tax imposed on the relocated license to the State Universities Athletic Capital Improvement Fund to finance capital improvements/renovations to athletic facilities at public universities.
  • appropriates 2% of the adjusted gross receipts from the wagering tax imposed on the relocated license to Cook County to enhance the county's criminal justice system.

    "I want to thank the General Assembly, members of the horse racing industry and all those who worked long and hard to come up with an acceptable, bi-partisan resolution to this issue," Ryan added.

    Senate Bill 1017 was sponsored by Senators Stanley B. Weaver, R-Urbana and James "Pate" Philip, R-Wood Dale. The bill was sponsored in the House by Representative Joel Brunsvold, D-Milan.

    The legislation is effective immediately.

    In conjunction with the signing of Senate Bill 1017, the Governor appointed to the Illinois Gaming Board:

    Gregory C. Jones. Jones is a lawyer with an extensive background in law enforcement.

    Joe Lamendella. Lamendella is a lawyer and CPA. He has been employed as a federal prosecutor and has worked with the Internal Revenue Service.

    The Governor will also officially recommend to the Gaming Board the selection of Sergio E. Acosta as the new Administrator of the Gaming Board. Acosta currently serves as Assistant U.S. Attorney for the Northern District of Illinois. He is a former Assistant State's Attorney of Dade County Florida where he worked under Attorney General Janet Reno.

    Attached is a statement by Governor George H. Ryan regarding proposed gaming reforms.

    ###

    STATEMENT OF GOVERNOR GEORGE H. RYAN

    "Today I approved legislation providing a number of significant changes to the gaming laws of Illinois. These changes were necessary to allow Illinois riverboats to compete with those of our bordering states -- and that means increased state revenues and renewed economic opportunities for those towns in direct competition with gaming venues outside Illinois. I believe the provisions of this legislation will provide substantial economic benefits to the Quad Cities, Metro East and other areas of our state by allowing Illinois riverboats to compete with boats in neighboring states by offering dockside gambling. In addition, this legislation will allow the one inactive gaming license to be relocated, so that state taxes again can be collected from the newly located riverboat.

    "This legislation addresses the concerns of the state's ailing horse racing industry by providing an appropriate level of assistance to an industry that supports thousands of jobs statewide. The provisions of this legislation will provide substantial economic benefits to the communities of northwestern Cook County by enabling Arlington International Racecourse to reopen its doors and provide significant employment to area residents.

    "While I have heard and can appreciate the concerns of those who feel that this legislation represents an expansion of gambling, I do not believe that this constitutes an expansion of riverboat gambling. It does repeal the prohibition against gaming in Cook County, but it does not increase the number of gaming licenses in Illinois. The state will continue to license only ten riverboats. Certainly the residents of Cook County -- indeed all 11 million residents of Illinois -- were already fully able to access all aspects of gaming previously legalized in this state and in bordering states. This legislation enhances previous gaming laws to maximize the state's share of taxes generated by existing gaming licenses.

    "I do recognize that gambling in any form can become addictive behavior. The State in some ways is a partner with the various gambling activities in that it not only regulates these activities but is the tax revenue beneficiary of the various gambling options. Understanding this, I have very strong reservations about state tax dollars being used to actively promote gambling through advertising. In January of this year, long before the debate on the issue of gambling began in earnest, I ordered that the advertising budget for the Illinois Lottery be dramatically reduced. It was reduced by nearly $6 million dollars. We will also continue to review all state supported advertising for gambling with a view to reduce and eventually eliminate state participation in any such pro-gambling advertising efforts. This fall, I will also ask the General Assembly to act upon Rep Mulligan's suggestion that $2 million be appropriated to provide assistance to "compulsive gamblers" just as we assist those with other addictions. This is a legitimate state, social concern. In the meantime, I will immediately direct the Department of Human Services to expand their efforts to assist those with gambling related problems.

    "I am aware of recent studies suggesting that gambling may be linked to crime. Any potential link between state-legalized gaming and increased crime is troubling. We must take strong steps to ensure the integrity of state licensed activities. Therefore, I believe it is imperative to empower the Illinois Gaming Board to enact strong rules for regulatory oversight and control. Effective today, I have appointed two new members to fill vacancies on the Gaming Board. They have the requisite training and experience necessary to regulate this industry. I have asked Gregory Jones and Joe Lamendella to join the Gaming Board and use their vast legal and law enforcement backgrounds to help the Board regulate gaming in Illinois. Chairman Tom Johnson has advised me that he will be leaving the Board, but has agreed to remain for a period of transition. I have asked board member Robert Vickrey to assume the role of Chairman. In addition, I will recommend to my appointees that they select Sergio Acosta for the position of Gaming Board Administrator. Sergio is Assistant U.S. Attorney for the Northern District and I am confident his expertise will serve the Board well.

    "In addition, I will propose that the Gaming Board consider a number of administrative reforms designed to ensure the integrity of gaming in Illinois. First, I would like to see the law and penalties regarding underage gambling strengthened. Second, I would like to strengthen the Gaming Board's authority to regulate ownership interests, transfer of ownership, owner license contracts, related party agreements, and benefits derived from ownership. Third, I will suggest the prohibition of automatic teller machines on all riverboats. Fourth, I plan to significantly increase the number of Illinois Department of Revenue investigators currently policing riverboats.

    "And finally, a recent report of the National Gambling Impact Study Commission included a recommendation that a moratorium be placed on new gambling activities. In response to their recommendation, I intend to send a letter to the Governors of each of our five bordering states urging that we pursue a regional "interstate compact" to ensure a uniform approach to gaming activities in the region.

    "Senate Bill 1017 is not a perfect bill -- few bills are. But I believe this legislation meets our needs. The economic benefits of its passage will soon be realized. And, with these appointees and suggested reforms, I am confident that we can ensure the integrity of Illinois' gaming activities.

    "The issue of the propriety of gambling as a state recognized activity will be debated and should continue to be debated. That is what our governmental process is all about. Those who oppose gambling have reasonable and legitimate concerns. They are not unreasonable zealots attempting to enforce their idea of proper individual activity. On the other hand, those who support gambling, and speak of its economic benefits are not evil, non-caring people. Both sides of this issue have legitimate points of view that the citizens and elected officials of this state must consider. This discussion and debate will continue....as it should. Eventually, society will arrive at a sufficient consensus to determine the accepted view of our citizens. I am certain that when that happens our political system will respond."


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