Chicago Mayor Lori Lightfoot has a message for state lawmakers eager to generate revenue from new casinos: Easy with the taxes.
In an interview with Crain’s Chicago Business, the Chicago mayor said she’s concerned that Illinois’ high taxes would make any investment in a casino in Chicago unlikely.
“The taxes on that don’t make any sense,” she said. “We said at the time that they didn’t make any sense.”
Illinois lawmakers have banked spending plans on revenue from the addition of six new casinos, including one in Chicago.
Lightfoot said the startup costs, which include taxes and licensing fees, need to be dialed back so that the Chicago casino can be profitable enough to attract investment.
“Let’s not kill the golden goose,” she said. “All of us are going to have to take less in order to make sure that we are going to have a casino.”
This is in line with a feasibility study that concluded the state and Chicago set taxes for the proposed casino too high.
"We believe a reasonable casino developer would not move forward with a greenfield casino project that has, at best, a low single-digit profit margin," the authors wrote in the report. "To the extent a casino operator could pare down expenses and realize modest revenue and profits from non-gaming amenities (as we have projected herein), total enterprise profit margin would, in a best-case scenario, likely equate to a few pennies on the dollar – and that would require the casino to be developed without incurring any debt as we believe no traditional financing would be available for such a development as debt servicing would likely well exceed any modest profits generated."