CHICAGO -- Mayor Richard M. Daley yesterday upped the ante on his proposal for a casino entertainment complex in chicago by unveiling legislation that includes the issuance of $1 billion of bonds backed by gaming revenues for the construction and renovation of Illinois schools.
The mayor's proposal will be introduced during a special session of the Illinois General Assembly scheduled to begin Nov. 17, according to Daley.
"This is a golden goose for Illinois," Daley said in a press conference. "The writing's on the wall, and anyone who tells us to slow down and take time is out of touch."
The $1 billion of bonds would be issued by the state Bureau of the Budget and backed by gaming revenues, the proposal says. Those funds would be deposited in the proposed Illinois School Building Fund, to be administered by the Illinois State Board of Education. If debt service from gaming revenues is not sufficient, the state's sales tax revenues would be used to pay off the bonds, according to John Holden, spokesman for the city's finance department.
In March, Circus Circus Enterprises Inc., Hilton Hotels Corp., and Caesars World Inc. proposed a plan to build a $2 billion casino and entertainment complex in Chicago. Legislative approval of land-based gambling and a 10% reduction in the state's gambling tax would be needed to accommodate the privately financed complex.
However, the casino proposal met with a cool reception from Gov. Jim Edgar and many Illinois lawmakers, who were concerned about expanding gambling in the state.
But State Senate President Philip Rock, D-Oak Park, believes the addition of the bonding for school is "very much a plus on the side of the bill's passage," according to Cindy Huebner, Rock's spokeswoman. She added that Rock will sponsor the bill in the Senate and that House Speaker Michael Madigan, D-Chicago, will sponsor it in the House.
Edgar yesterday expressed opposition to the mayor's proposal and said he would veto the plan, according to Mike Lawrence, the governor's spokesman.
Lawrence said the mayor's plan "raises new concerns" and could jeopardize state general revenues currently used to fund education. The spokesman explained that if the school building fund bonds go into default, the state's general revenues, which finance the state's share of funding, would be tapped to pay off the bonds.
Daley's proposal also would create a five-member Metropolitan Entertainment District Authority, which would be able to issue $500 million of revenue bonds to cover land purchases, relocation costs for residents and businesses, and other expenses. Under the plan, the mayor would appoint four of its five members.
The authority's bonds would be backed by fees, lease payments, and other revenues of the authority. If debt service is not sufficient, according to the mayor, Circus Circus, Hilton Hotels, and Caesars World would be responsible for paying the bonds off.
As a result of the Nov. 3 election, Republicans will have a majority in the Senate come January. But the upcoming special session will give the Democratic mayor a Democrat-controlled legislature to consider his casino bill.
Mark Gordon, spokesman for Republican Senate Minority Leader James Philip, R-Wood Dale, the probable next Senate president, said Philip was out of the state and has not reviewed the mayor's latest proposal. Gordon noted, however, that it is unlikely that the measure would pass this fall primarily because it did not include enough incentives for downstate legislators.
But the issue could be resurrected next spring when Republicans will control the Senate with a 32-to-27 majority, Gordon said. Passage of the measure in the next session, he said, would depend on whether legislators "sit down and seriously negotiate a realistic proposal."
Gordon said Philip has been opposed to the mayor's proposal, but has not "slammed the door" on the idea.
The Illinois State Board of Education has not reviewed the plan in detail and could not comment on the plan, according to Kim Knauer, spokeswoman for the board.