Lincoln Mayor proposes lowering
the ceiling on video gaming
Motion to be on the July 15th voting
agenda
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[July 14, 2024]
At
the Tuesday night meeting of the whole committee, a lengthy
discussion revolved around making permanent changes to the
ordinances involving video gaming in Lincoln.
Lincoln Mayor Tracy Welch prefaced the discussion saying that quite
some time ago, he had advised the council that he would not be
signing any more video gaming licenses until the number had dropped
considerably.
Tuesday evening, Welch said that since that time, the number of
licenses in Lincoln has dropped from 240 machines to 200, but he
still wants the number to go lower.
He said the city has too many machines, and to support that, he had
done research on surrounding areas. He said that towns within the
region with similar populations had far fewer than Lincoln. He noted
Canton has 72, Chatham has 57, Rantoul has 80. He noted that Kewanee
has 183 and he said that Effingham has more than Lincoln.
Welch said that his thoughts are that he doesn’t want to deter
business, but at the same time, the council should consider what the
city looks like to visitors, and the number of video gaming
establishments makes the city look like, to quote a friend of his
from out of town, a Little Vegas.
Welch said it had taken about three years for the number of machines
in Lincoln to drop from 240 to 200. He is proposing that the number
be permanently established at 175 and would even prefer 150. He said
this would not impact any existing licenses. So even though the
ceiling would be set, it could still be several years before the
number of machines dropped down to or below that ceiling.
At the moment, there are no written numbers in the books for gaming
machines. Welch said that there had been a consensus when the city
agreed to allow gaming that the licenses could be issued and the
“strong would survive,” in other words the number of machines in the
town would be self-regulating according to demand.
Welch said he had met
with the liquor commission about his desire to set a ceiling lower
than the current number of licenses. He said while he would have
like the limit set lower, the 175 was a “compromise” number that he
had reached with the commission. He added that the number could be
amended later.
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If passed, the 175 limit would become part of the
gaming ordinance. However, city attorney John Hoblit explained that
this would have no impact on the licenses that are already in place.
The entire 200 would be grandfathered in. he said however, if a
business closed, those licenses would be lost, and no new license
would be issued to replace them until the number reaches below 175.
Welch said he wanted to elaborate, that the city is not out to hurt
existing businesses. He said there would be instances where license
would not be lost. For example if a business moves, the license will
move to the new location with the business. If the business sells,
with the only real change being the change in ownership, those
licenses would be transferred. He added that the transfer would be
conditional with the new owners passing all other requirements such
as background checks. Welch said the liquor commission had required
these concessions and he agreed with them.
Welch said he wanted to be clear. He is not anti-video gaming in the
city. His desire is to get the number down to something more
reasonable. The concessions mentioned would not increase the number
of licenses or machines in the city, and his main goal is to let the
number come down to a more desirable level before considering future
approvals.
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Alderwoman Wanda Lee Rohlfs had asked about the
profitability of the gaming machines within the businesses. Had
there been any research to show how that increasing the overall
number of machines in the city had impacted the overall income to
individual businesses. Welch said the city has not done any research
in that area. Welch said what has been seen that can be supported by
city treasurer Chuck Conzo is that the city share of revenue from
the machines has leveled off and is neither decreasing nor
increasing at the moment. He said that there have been a few cases
where businesses have discontinued gaming, but it is very few.
Rohlfs said that she did feel the number of machines in Lincoln was
very high, but she wondered why. Was the demand higher here or are
there machines that are just not being used. Welch said that in the
beginning that strong will survive philosophy had negated placing a
limit on the number of licenses issued, so everyone who qualified
for the class B liquor license with gaming attached was given their
license. He said he had figured at one time that there was one
gaming machine for every 55 people in the city, and that is too
much.
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Rohlfs said she thought that when
the revenues started coming from the gaming the council had
talked about gambling addiction and perhaps setting aside a
portion of the income for addressing addiction. Welch said he
didn’t believe that was ever done. He added that when the city
moved the cost of license from $25 to $250, the money had been
earmarked to go to streets and alleys for road repair and
maintenance.
Conzo offered a few observations for the council. He said that
in many cases, he believes the patronage to these gaming
machines is not just local residents. He said many times the
revenues from the machines in higher in travel locations. He
said for example Effingham that was mentioned earlier, has two
major interstates plus state highways going through it, so they
probably get a lot of patronage from travelers. He said that
Lincoln also has travelers from the interstate as well as
Illinois Route 10, and that may be creating a larger market for
gaming in town.
![](http://archives.lincolndailynews.com/2024/Jul/10/images/ads/current/debbiesfloral_lda_052824.png)
Conzo also noted that though it has leveled off,
gaming is a revenue stream for the city. He said that as the number
of games dropped so would the revenue. He added that the city should
bear in mind the elimination of a sales tax on groceries would
impact revenues as well.
Noting it was a bit off topic as he spoke, Hoblit did remind the
council that the state has added a provision to its grocery tax rule
that would allow the city to impose a local tax to compensate for
the state tax loss. He said if the city wants to pursue that, it
should start considering it.
Alderwoman Robin McClallen said she wanted to thank the mayor for
making this move. She said it would be a positive for the community,
and it would make the town more attractive.
There was further discussion about the signage and the “feather
flags” that are outside nearly every gaming business. It was
mentioned that perhaps the answer could be to control the flags and
establish some signage ordinances to address them. Welch said
signage has been a topic of discussion many times in the council and
the problem is that no one can agree. In addition, there becomes a
question of how much the city can influence what is placed on
private property.
Alderman Kevin Bateman agreed that the signage was part of the
issue. He said that if the businesses had gone about their business
quietly, the council might not even be having this discussion. He
also said that during the establishment of the gaming rules, he had
been in the gallery, and he had agreed with the strong will survive
theory, but he was wrong.
Welch said there were also a few entities that had licenses they
were not using. He said that the businesses had gotten the licenses,
were paying their renewals, but were not using them yet. He said
that perhaps the next step would be to reach out to those holders
and let them know that they needed to relinquish the licenses and
reapply if and when they needed them. However, he added that there
were questions about the legalities in taking this kind of action
and so that could come at a later date.
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There was discussion about when gaming was first
approached, the idea was that machines would be the secondary income
of a business, and not the primary. However, changes in the rules
had made it to the point where that gaming seemed to be the primary
source of income in many cases.
Alderman Steve Parrott recalled that when the gaming license went
up, there were businesses that came to the council and said clearly
that they could not survive without gaming. He said he would like to
see it go back to gaming being the secondary income with other sales
being most of a business’s revenue.
At the end of the discussion, aldermen agreed to place a motion on
the Monday, July 15th voting agenda to establish a ceiling of 175
video games within the city limits. Again, the number is currently
at 200, and no games will be shut down as a result of the ordinance.
The number will only fall when licenses are not renewed by existing
businesses, and that could take a number of years.
As always the council has the right to table any agenda item if they
feel they are not prepared to make an informed decision.
It should also be noted that the city council’s Monday July 15th
meeting will be delayed by 30 minutes to 6:30 p.m.
[Nila Smith]
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