Illinois is gearing up for its largest gambling expansion in a long while, and Las Vegas gaming machine manufacturers have already begun assessing their opportunities in the market.
Earlier this month, the state’s Legislature passed a sweeping gambling reform that allows for the addition of up to six new casinos, including one in Chicago, the regulation of sports betting, the addition of slot machines at O’Hare International and Chicago Midway International airports and of more gaming machines at bars and taverns, among other things.
The piece of legislation is yet to be signed by Illinois Gov. J.B. Pritzker, but the state’s top official has so far been highly supportive of the gambling expansion effort, which means that securing his signature would not be an issue.
The bill allows 30,000 additional slot machines and video gaming terminals in Illinois. And while gambling industry experts do not believe that all available positions will be filled, the upcoming gambling reform is still likely to see the addition of 15,000 to 20,000 new machines at different facilities around the state. That’s what SunTrust Robinson Humphrey analyst Barry Jonas estimates, “assuming all the new casinos get built.”
Mr. Jonas also believes that between $79 million and $224 million could be generated in earnings from the sales of new gaming units.
Top Manufacturers Eye Illinois Expansion
Asked about what they think of Illinois’ upcoming gambling expansion, Derik Mooberry, Executive Vice President and Group Chief Executive of Gaming for Scientific Games, told the Las Vegas Review-Journal that the Las Vegas-based slot machine manufacturer is excited as the recently approved bill “provides a lot of opportunities for us.”
Mr. Mooberry added that Scientific Games is among the leading suppliers of gaming machines in the Illinois market and that the company would take part in all aspects of the expansion.
IGT Vice President of Global Communications, Trade Shows, and Creative Services Paul O’Shaughnessy said that the company views the expansion as an opportunity and that it would move to install machines at the Illinois airports. IGT currently operates gaming machines at the Las Vegas and Reno airports in Nevada.
Nevada Casino Operators More Cautious
While some of the major gaming machine manufacturers seem to be enthusiastic about the upcoming opportunities in the Illinois market, casino operators have taken a more cautious approach.
A Penn National Gaming executive has told the Review-Journal that the company is reviewing the gaming and betting expansion bill and that this is one of the most massive expansion packages in recent years and is all happening in a state “that is already saturated from a gaming standpoint.”
Brian Sandoval, the former Governor of Nevada who now serves as President of Global Gaming Development at MGM Resorts International, said that Illinois “presents a new and dynamic market” and that they will certainly consider their options there.
Las Vegas Sands said that it currently has no plans to expand in Illinois and is not considering any opportunities.
According to experts, Chicago could certainly attract major casino operators due to its high volume of visitors, which last year reached 58 million.
However, Jennifer Roberts, Associate Director for the International Center for Gaming Regulation at the University of Nevada, Las Vegas believes that many operators might feel reluctant to expand in the Illinois market due to high tax rates and other costs. Casinos are taxed in Illinois on a graduated basis, which means that the more revenue they generate, the higher taxes they pay.
Follow us on Facebook and Twitter to stay up to date on the day’s top casino news stories.
