A decision on gaming machines could hurt Pekin’s bottom line

Gaming machine
Gaming machine(WAVE)
Published: Jun. 1, 2023 at 9:51 PM CDT
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PEKIN (25News Now) - A ruling in Tazewell County Court could cost Pekin hundreds of thousands of dollars in revenue and may have implications statewide on the ability of local governments to collect earnings from video gaming terminals.

Judge Paul Bauer tossed out Pekin’s ordinance adopted last October charging gaming machine operators 2.5% of net revenue from the terminals, with that money to help fund police and firefighters’ pensions.

Supporters of the ordinance said charging operators based on their earnings was fairer than charging a flat fee for each gaming machine.

However, two members of Illinois Gaming Machine Operators Association (IGMOA) sued the city in December claiming the ordinance imposed an “illegal tax” violating Illinois’ Video Gaming Act.

Pekin has 44 businesses with video gaming terminals, and the city government expected to collect about $210,000 annually from the machines, according to a city staff’s report.

“This is an important win for our members, and for the small businesses and customers we serve in Pekin and across Illinois,” said Ivan Fernandez, the IGMOA’s executive director, in a news release.

“We work well with our local government partners in the communities we serve around the state, but sometimes, they seek to ask for a greater piece of the video gaming pie than the law allows,” Fernandez said.

“This ruling sends a strong message that Illinois communities should work with our members to draw in more customers and play, not drive them away with unnecessary taxing schemes, and we will take these arguments to other communities where these local taxes are being considered and pursued.” Fernandez also said.

The city can appeal the judge’s ruling. So far, there’s been no comment from the city.