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Thursday, December 17, 2015

Appellate Court Upholds $1000 Video Gaming Fee

Last December, we reported on a trial court decision upholding Elmwood Park's $1,000/terminal fee for video gaming licenses. Village's $1000 Video-Gaming License Fee Upheld. Last week, an appellate court decided Accell Entertainment Gaming LLC's appeal of that decision, ruling in favor of the Village and upholding the license fee.  

The Village had adopted an ordinance imposing a $1,000 license fee per video gaming terminal, relying on its home rule authority to impose the fee. A gaming company applied for and obtained state licenses to install video gaming terminals in a restaurant in Elmood Park. However, the company did not pay the Village's license fee, nor did it obtain the required local licenses for the gaming machines. Instead, the company requested that the Village waive the fee. When that request was denied, the company sued, claiming the fee was unconstitutional and the Village was preempted from requiring a license or license fee.

The appellate court upheld the ordinance based on Elmwood Park's home rule authority. Specifically, the court found the ordinance pertained to the Village's local government or affairs and was not preempted by state law. The court noted that the challenged ordinance "applies only to video gaming operations within the Village boundaries and it does not attempt to regulate video gaming operations outside of the Village’s boundaries." The court also determined that the license fee was not preempted by section 21 of the Riverboat Gambling Act, and also was not an impermissible occupation tax. At most, the court stated, the license fee was a tax that the Village was authorized to impose. As a result, the court upheld the trial court's dismissal of the challenge to the Village's video gaming licensing fee and ordinance. Accel Entertainment Gaming, LLC v. Village of Elmwood Park

On the same day it ruled in the Elmwood Park case, the appellate court issued a similar opinion upholding Cook County's video gaming tax of $1000 in Illinois Coin Machine Operators, et al. v. County of Cook. The analysis in both cases is nearly identical, although the first involved a home-rule municipality and the second a home-rule county.

Post Authored by Julie Tappendorf


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