Betting in black: 5 years in, video gambling a success for DeKalb County businesses, cities


SYCAMORE – Adam Swedberg said he’s seen a lot of changes in his 30 years running a bar.

[Matthew Apgar – mapgar@shawmedia.com]

Happy hours have been outlawed (and come back), craft beers have exploded in popularity and five years ago, the games with labels reading “for amusement only” became (somewhat) legitimized.

After the General Assembly passed the Video Gaming Act in 2009, the first terminals in Illinois were switched on in September 2012. By November, there was video gambling in Sandwich and Genoa.

“A lot of bars stayed afloat because of the machines,” Swedberg said.

 

[Matthew Apgar – mapgar@shawmedia.com]He said the five machines at Cub and Spank’s in downtown Sycamore have allowed him to sponsor more events around the community. Although the bar always sponsored softball teams, he said, he wasn’t able to donate a lot to charity before.

“We try to use a portion of the revenue positively,” he said.

[Matthew Apgar – mapgar@shawmedia.com]Video gambling has been a moneymaker. In August, 285 terminals were spread across 66 locations in DeKalb County, according to the Illinois Gaming Board, the agency that oversees video gambling and riverboat gambling. Bettors wagered a total of $11.6 million, losing $914,000. That $914,000 is the net terminal income, 30 percent of which goes to the state, while the remaining 70 percent is split between the machine operator and the business.

“It’s grown quicker than expected,” said Derick Ibarra, a partner in a business that operates cafés in DeKalb and Sycamore.

He said he came from the restaurant business. His family used to own Cabana Charley’s in Sycamore.

It wasn’t a deliberate shift, Ibarra said, but changes in the restaurant industry led to the cafés. He had opened a few terminals next door to the restaurant his family owned, and later, when it came time to reconcept the restaurant, he said he felt someone elsecould do a better job.

“We got out of the restaurant business, but continued with the gaming business next door,” he said.

[Matthew Apgar – mapgar@shawmedia.com]The name stayed with the video gambling business and now, there are two Charley’s Video Gaming parlors.

Ibarra said there are three entities that work in the business together – the business housing the terminals, whether it is a restaurant, bar or café; the company that owns and operates the terminals; and the state.

Through August – the most recent available data – the state has collected almost $1 billion, and another nearly $200 million in video gambling tax has been distributed to municipalities. Illinois has collected $8.1 million from DeKalb County video gambling.

[Matthew Apgar – mapgar@shawmedia.com]Across the county during the five-year period, municipalities have collected more than $1.6 million.

In Sycamore, that money goes toward capital projects, City Manager Brian Gregory said. “We use it for sidewalks,” he said.

In DeKalb, City Manager Anne Marie Gaura said the city expects to take in about $205,000 this year from the terminals, which she said is a 30 percent increase over last year. The revenue goes into the city’s general fund, which funds general operations, she said, including police, fire and public works.

According to the Illinois Gaming Board, no municipality in DeKalb County has banned video gambling, but 10 have passed ordinances regulating the terminals.

Gregory said Sycamore hasn’t seen problems connected with the gambling terminals. The city has a special class of liquor license for video gambling cafés, along with regulations determining how much space can be used for gambling or alcohol sales.

Owners have said they take precautions to prevent problems.
Swedberg, who runs five machines in his bar in downtown Sycamore, said he's never seen anything out of the ordinary in his establishment.
"I'm not going to let people panhandle to gamble," he said. "If you can't afford it, you shouldn't do it."
Five is the maximum number allowed in one establishment by state statute.
Ibarra said he agrees with regulation.
"There needs to be limitations in place," he said.
His DeKalb location is part bar, part video gambling. When reflecting on any controversy at the time video gambling first was legalized in Illinois, he said things have changed.
"People always grow tolerant," Ibarra said. "Now no one bats an eye."
[Matthew Apgar – mapgar@shawmedia.com]Owners have said they take precautions to prevent problems.

Swedberg, who runs five machines in his bar in downtown Sycamore, said he’s never seen anything out of the ordinary in his establishment.

“I’m not going to let people panhandle to gamble,” he said. “If you can’t afford it, you shouldn’t do it.”

Five is the maximum number allowed in one establishment by state statute. Ibarra said he agrees with regulation.

“There needs to be limitations in place,” he said.

His DeKalb location is part bar, part video gambling. When reflecting on any controversy at the time video gambling first was legalized in Illinois, he said things have changed.

“People always grow tolerant,” Ibarra said. “Now no one bats an eye.”


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