Galena, East Dubuque seek to boost gaming-related revenue following state law change

EAST DUBUQUE, Ill. — A recent change to Illinois state law could lead to an increase in the fees that area municipalities collect from video gaming terminals.

The law, effective Dec. 17, allows non-home-rule municipalities to impose an annual fee of $250 per video gaming terminal. That fee previously was capped at $25 per year.

Both Galena and East Dubuque are non-home-rule municipalities, meaning they only can exercise powers for which state law explicitly provides authority.

“We have to follow the rules they give us, and now the Legislature just gave us the right of up to $250 (per terminal),” said East Dubuque City Manager Loras Herrig.

Both cities currently are working to change their ordinances and collect the higher fee, which could add significant funds to their gaming-related revenue streams.

According to the Illinois Gaming Board, there currently are 90 video gaming terminals operating in 16 businesses in East Dubuque. A $250 annual fee for each terminal could garner $22,500 for the city, an increase of more than $20,000 from the city’s current total at the $25-per-terminal rate.

Galena boasts 50 terminals in 10 establishments. Increasing the annual terminal fee to $250 could lead to an additional $11,250 in revenue for the city.

However, officials in both cities are striving to ensure that this additional revenue does not come at the expense of business owners.

At a recent City Council meeting, Herrig said the city is working with the three terminal operators that install and maintain the machines in the city to develop a system by which terminal operators would cover the fee, either by paying the city directly or reimbursing the business owner.

Herrig said two of the three companies already cover the fee for their machines, one via reimbursement and the other via direct payment. The city would rework its ordinance to include that provision for all gaming terminals in town.

“If we can guarantee that it doesn’t place a burden on our local businesses and we can increase the revenue for our city, we’re going to pursue that,” Herrig said.

East Dubuque City Council members last week approved all liquor and city licenses for the city’s establishments for 2022, including video gaming terminal fees at the $25 rate. Herrig said a potential fee increase, if approved, would take effect in 2023.

Galena City Administrator Mark Moran said city officials also are working with the main terminal owner of the city’s machines, who would pay all or part of the increased terminal fee.

“That would take part of the payment pressure off the establishment owner,” he said.

Galena City Council members plan to discuss a change to the city’s video gaming ordinance at their meeting on Tuesday, Dec. 28. Moran said that change, if approved, would take effect in the city’s next fiscal year, which begins May 1.