At StakeNovember 13, 2015 – Newsletters
The Illinois Gaming Board (IGB) held its monthly meeting on Friday, November 6 in Springfield. Following is a summary of both the Riverboat and Video Gaming Meetings, as well as additional items of note.
The Chairman’s opening remarks included a welcome to Springfield. He stated he looks forward to holding approximately two Board Meetings in Springfield next year.
The Chairman also welcomed new Board Member Dee Robinson and noted her accomplishments as a successful business owner and CEO of Robinson Hill Inc., a food and beverage distributor. He stated that Member Robinson is a member of the Business Leadership Counsel, the Chicago Network and the Economics Clubs and that she was recognized as entrepreneur of the year by Black MBA magazine and named ”Top 100 Under 50 Executive Leaders.”
Continuing his comments, the Chairman informed the audience of the Diversity Business Symposium taking place at the Par-a Dice Hotel in East Peoria on Tuesday, November 17, where Administrator Ostrowski will be the keynote speaker.
The Administrator encouraged participation in the Diversity Business Symposium by both casino personnel and vendors to highlight and build relationships among casinos, their communities and vendors. Secondly, the Administrator stated that the Board and staff have discussed the minority contracting goals and will continue to work with Mr. Swoik of the Illinois Casino Gaming Association and casino general managers. Those goals are due to the Board by December 1, 2015. Staff is currently trying to coordinate a call to further discuss this matter.
Alton Gaming Company d/b/a Argosy Alton had its owner’s license renewed, and the following Level 1-Occupational Licenses were approved:
- Joelle Shearin – Vice President and General Manager of Argosy Alton
- Jeffrey Smith – Surveillance Manager of Argosy Alton
- Christopher Britten – Information Systems Operations Manager of Hollywood Casino Joliet
- Mark Begrin – Interim Vice President of Finance of Hollywood Casino Aurora
- Jason B. Jones – Internal Auditor of Casino Queen, Inc.
- Randall H. Conroy – Senior Vice President and General Manager of Southern Illinois Riverboat Casino Cruises, Inc. d/b/a Harrah’s Metropolis Casino
- Eric Zabel Des Plaines Development d/b/a Harrah’s Joliet Casino
The Board stated that due to company restructuring, GTECH USA, LLC has its initial consideration, and staff will continue working with the company to prepare the requirements for the Board’s final consideration. In addition, as a result of the Scientific Gamines acquisition of WMS Gaming, Inc., WMS no longer exists, and the Board approved the waiver of the two-meeting rule requirement and granted the surrender of WMS Gaming, Inc.’s supplier license.
The following Supplier Renewals were granted:
- Bally Gaming, Inc.
- JCM American Corp.
- NRT Technology Corp.
The Board approved 65 Level 2-Occupational Licenses and 183 Level 3-Occupational Licenses and denied three such licenses.
The Board denied the Requests for Hearing and the Requests to Reapply of two individuals, Betty Alms and Christina Ratcliff, due to alleged noncompliance with the Board’s hearing request rule.
The Board issued a disciplinary action against Occupational Licensee Mr. Leonard Romberg III and approved the revocation of his occupational license. Mr. Romberg allegedly took possession of a chip during his employment and was terminated as a result of his alleged actions.
Video Gaming Meeting
The Chairman declined to make any additional remarks beyond those of the Riverboat Meeting and opened the floor to other Board Members. At that time, Board Member Dunn addressed the issue of video gaming and having multiple locations at a mall. Among other things, he stated that video gaming and these locations are adversely affecting casinos. He indicated they are decreasing tax revenue and employment in the state and that video gaming business does not hire enough additional people to the workforce to count.
There were two speakers during the public commentary portion of the meeting: (1) Marylyn Neumeyer of J.D.’s Firewater, Inc. and Trustee for Village of Swansea and (2) Anita Bedell as Executive Director Illinois Church Action on Alcohol and Addiction Problems (ILCAAAP).
Ms. Neumeyer requested that the IGB consider the adverse effects casino cafes have on the community of Swansea when reviewing the location renewals for such establishments. She cited issues such as loss of taxable revenue due to the limited sales at casino cafes.
Ms. Bedell thanked Member Dunn for his opening comments. She also voiced concern about video gambling parlors and wanted to know if, and how, the IGB is limiting the number of terminals operated by a single Terminal Operator. Specifically, Ms. Bedell referenced Penn National’s acquisition of Illinois Gaming Investors, LLC. According to Ms. Bedell, the volume of VGTs involved in this acquisition are equivalent to acquiring another casino but with less regulations and higher profits. Ms. Bedell also stated concerns that three of the largest Terminal Operator companies own approximately one third of the industry’s VGTs, which she claims is a form of undo economic concentration. Additionally, she asked that the IGB review and “perhaps narrow rules” regarding undo economic concentration. In conjunction, she asked that the IGB not approve player tracking devices and programs. She stated that such programs target problem and pathological gamblers. The Chairman stated that staff is currently working on the undo concentration rule.
The following Terminal Operators had their licenses renewed:
- Angelle & Green Gaming LLC
- Barcade Gaming LLC
- Dearborn Gaming, LLC
The Board passed three motions regarding DSG Amusement, Ltd. The Board rescinded the denial of DSG Amusement, Ltd.’s license renewal, denied the hearing request as moot and issued a disciplinary complaint seeking a $15,000 fine while allowing the Administrator to enter into settlement proceedings for payment of the fine.
The Board issued a disciplinary complaint and a $5,000 fine to the Terminal Operator, Midwest Electronic Gaming. Allegedly, Midwest Electronic Gaming was asked several times to respond to project requests by the Board and did not comply, thereby allegedly violating the Board Rules.
The Board approved 61 terminal handler licenses and two terminal technician licenses, and it denied seven such licenses.
The Administrator reported that there are 5,160 locations that are operational with a total of 21,676 VGTS.
The Board approved 130 location licenses and denied 21 location licenses.
The Board rescinded the denial of Yogibapa LLC, placing the application back to pending status, granted the request to reapply of Antonio Hudson d/b/a Club Suav-ve and authorized the Administrator to enter into settlement discussions with Greg’s Old Town Tap, including a $10,000 fine for the Board’s previously issued disciplinary complaint.
The IGB denied the hearing request of seven locations and granted the request for a hearing for Lisa Frisby Enterprises, LLC.
The IGB issued numerous disciplinary complaints to licensed establishments. Mr. Pellum stated that locations are too heavily relying on Terminal Operators to communicate with the Board and encouraged applicants to work with the Board to ensure all information is current and accurate.
The following establishments received disciplinary complaints:
- Wendell’s Dugout Lounge, Inc. allegedly failed to notify the Board of a liquor license suspension and was issued a $1,000 fine
- Wing Enterprises, Inc. allegedly allowed underage persons to play VGTs and was fined $5,000
- Tavern on 60, Inc. allegedly allowed underage persons to play VGTs and was fined $10,000
- Connie Fairbanks d/b/a Outhouse allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
- Los Charros of Carthage Inc. allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
- Delaney 3rd Street Grub & Pub, Inc. allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
- JARMAC of Illinois, LLC allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
- American Legion Clarence V. Scheel Post No. 292 of Mascoutah, Illinois allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
- R Bar LLC allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
- Sportsman’s Tap, Inc. allegedly failed to notify the Board of ownership changes in a timely manner and was fined $2,500
The Board also revoked the establishment licenses of three locations for allegedly actively concealing their ownership structures from IGB agents and staff or staff was not comfortable with the time taken to update the information. The locations are Di Fi and Family, Inc., Cermak Beach LTD. and Echo Lanes of Morris.
With the upcoming holiday season, we have recently inquired to the Illinois Gaming Board about the permissibility of presenting locations with holiday gifts. According to IGB General Counsel, reasonable and nominal gifts, such as fruit baskets or candy assortments, are permissible. However, records of the gifts and recipients must be maintained.
In addition, the IGB provided guidance on how video gaming licenses could share in the burden of the fines imposed by the Cook County Gambling Machine Tax Ordinance without running afoul to the IGB’s inducement policy. That guidance is available at https://www.igb.illinois.gov/FilesVideoLaw/CookCountyMachineTaxOrdinance.pdf
Please call or email with any questions.
Donna B. More
Partner, Fox Rothschild
Partner, Fox Rothschild