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Galesburg, Illinois, stands at a crossroads as video gaming terminals (VGTs) have been a boon for local businesses, but the sheer number of them has begun to alarm locals. Its city council must choose whether to cap the number of the devices, declare a temporary moratorium on new installations, or let them continue to spread unchecked.
It’s a debate reminiscent of the conversation around online gambling, where you’ll often hear words like “everywhere” and “inescapable.” In many places, gambling is more convenient than ever, but some worry that access has become too easy.
33 Galesburg establishments, such as bars and restaurants, offer 190 gaming terminals. The city council has taken note of the clustering of video gaming establishments, prompting concerns about regulation.
Hence, by implementing a moratorium, the city can take a breather and assess its approach to regulating these businesses.
How VGTs impact the gambling industry in Illinois and local sentiment
Galesburg’s City Manager Eric Hanson and City Clerk Kelli Bennewitz are pushing for a temporary freeze on new video gaming licenses. They want to amend the municipal code to stop city staff from accepting new applications, but existing licenses would still be valid and renewable.
The general belief is that this huge number of terminals amounts to a high rate of gambling; however, some people like Steve Cheeseman, a Ward 7 alderman, beg to differ.
“In short, limiting gaming machines does not help with gambling issues. But it may, in fact, have a negative effect on business revenue. So, I do not support a cap on them,” he said.
Cheeseman’s opposition to caps is financially motivated. He contends that a moratorium would divert revenue from potential new operators to other jurisdictions, ultimately hurting Galesburg’s economic interests. He added:
“Folks will find other places to go, and the end result will not be helping whatever gambling issues are perceived, but the end result will be less revenue for the business denied the licenses as well as less revenue for the city.”
Now, City officials face a difficult decision as opinions on the matter are divided. While some, like Cheeseman, argue that a new license would lead to revenue loss for the state, others counter this claim.
The council believes the already saturated market would prevent significant revenue from leaving the state. In essence, while there’s a chance for increased revenue, there’s also a risk of diluting the profits of existing businesses without a significant overall gain for the city.
“While it is possible that additional gaming terminals would generate new revenue for the city, it could also be argued that the marketplace is saturated, and additional video gaming licenses would simply further divide those establishments that are already licensed,” a council letter read.
VGTs may have a stranglehold on the Illinois gaming market
The stalemate on legalizing online casinos in Illinois is not surprising, given the dominance of VGTs. With operators reaping the benefits of a monopoly, they are unlikely to welcome iGaming with open arms.
Albeit, states like Pennsylvania have already beat this hurdle.
Rather than blanket coverage, Keystone State VGTs are located at specific businesses, such as truck stops, targeting a distinct audience: travelers and transient visitors. This placement has created a harmonious coexistence with online casinos.
However, it is important to note that the state legalized Pennsylvania’s online casinos and VGTs simultaneously.
