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* Is the capital project funding in jeopardy? Time will tell, but if nothing else, this development won’t make it easier to sell bonds…

Blackhawks owner Rocky Wirtz on Tuesday filed a lawsuit claiming Gov. Pat Quinn and other state leaders violated the Illinois Constitution when they passed legislation to increase taxes on alcohol and expand gambling to fund the governor’s $31-billion public works program.

The suit, filed in Cook County Circuit Court, claims the 2009 Capital Program rolls too many subjects into one bill and fails to adhere to a uniformity clause, because the new law imposes “arbitrary, widely disproportionate new taxes on beer, wine and spirits.” Mr. Wirtz, president of Wirtz Beverage Illinois LLC, wants a judge to declare the new law unconstitutional and stop the “use of state funds and resources in the operation and administration and regulation of programs created by legislation.” […]

Mr. Wirtz claims the higher rates will raise taxes on beer 22% and up to 90% for wine and spirits, and that state lawmakers have failed to provide “coherent rationale” for the “vastly disproportionate” increases.

More…

The Wirtz suit could pose a greater threat to the public works plan, which would be hard to launch if a court blocked or stalled implementation of the tax hikes or gambling expansion. Legal challenges were expected when Gov. Pat Quinn signed the measures into law this summer. But in Wirtz, the program now has an opponent with broad political influence and the deep pockets necessary to mount an effective court fight. […]

The newly filed Wirtz lawsuit contends lawmakers violated several dictates of the Illinois Constitution in stitching together the building program, most prominently a mandate that legislation on substantive matters not pertain to a mishmash of unrelated subjects.

The suit also claims the video poker program, which would allow bars across the state to install video poker machines linked to the state through a closed-circuit Internet connection, violates federal gambling rules.

A companion plan to hire a private management firm to run the Illinois lottery similarly runs afoul of federal law, the suit alleges.

In essence, pretty much every single dollar raised to fund the capital bill is now being challenged.

* This is without a doubt the greatest problem with the new video gaming law…

The state’s top gambling regulator said [yesterday] it will be “absolutely impossible” to meet a mid-September deadline for drafting rules needed to roll out legalized video poker around Illinois. […]

“The video gaming statute creates not only a new branch of gaming, it creates an entirely new industry of gaming,” Jaffe said, estimating as many as 15,000 businesses across the state would be eligible to install gambling machines. “We are working on rules, but there is no way in the world that we will rush to finish rules like that unless we have the knowledge to do it and the ability to do it.”

The Gaming Board has no experience with stuff like this. The project probably should’ve been given to the Lottery, which already has a statewide network of machines and somewhat similar experience. The South Dakota video gaming law handed over authority to its Lottery, and things seem to be going pretty well there.

But keep in mind that the Gaming Board, like any state entity, is a bureaucracy, and bureaucracies always want as many resources as possible…

Jaffe said he was “disappointed but not surprised” that lawmakers failed to provide funding to get the program off the ground. The gaming board estimates it would need at least 75 additional staff members and $10 million just to implement the program. It would take even more resources to properly monitor and regulate, which he said poses a whole other set of problems.

* Somebody left this comment on the blog today, and I checked the IP address so I’m comfortable front-paging it…

Heard [Quinn] is also issuing an amendatory veto to reduce the number of signatures required for towns put the video gaming issue on the ballot. Using a horse racing related bill. Don’t know why he just didn’t AV the original bill if he wants that.

Expect more of this stuff.

* Related…

* Critics urge state to reconsider video

* Taxes going up on candy, shampoo, liquor

posted by Rich Miller
Wednesday, Aug 26, 09 @ 10:20 am

Comments

AV’ing the original bill would have held it up ’til veto session. This way he can have the capital cake but eat the populist anti-gambling icing too.

Comment by Beans Wednesday, Aug 26, 09 @ 10:31 am
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Taxes going up on candy, shampoo, liquor
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Sounds like we need a song from V-Man ala Alan Jackson’s “Everything I Love” to make a REAL statement re: our feelings about the increased taxes.

Comment by Anonymous Wednesday, Aug 26, 09 @ 10:31 am
Unless the state goes double-barreled with its GO or a portion of existing revenues — sales and/or gas tax — to provide additional coverage, I don’t think there’s a market for the cap bonds while the proposed revenue sources are in question.

I doubt if the suit has merit — I’m pretty sure the GA knows how to draft a revenue bill. The first move by the state is to get it tossed with prejudice as quickly as possible.

But what a brilliant pr move by Rocky Wirtz, friend of every Joe Sixpack who’s a potential Blackhawk ticket buyer. He learned a lot from his old man’s mistakes, and every pr moves he’s made to date has paid off at the gate.

Every day, it appears the video gaming portion of the revenues will be a lot smaller and a lot further down the road than projected. Looks like the folks who are currently profiting from illegal gambling will stay in business for quite some time.

Comment by wordslinger Wednesday, Aug 26, 09 @ 10:51 am
And down the rabbit hole we go.

The problem with the Wirtz suit is the court consider public policy impacts of a restarining order (such as the possible loss of stimulus money etc which may never be recovered, need for the jobs etc) AND the State can ask the court to order Wirtz to put up a bond to cover any losses it incurs if the temp restarining order isgranted, but Wirtz ultimatly fails. i.e. wirtz could be placed on the hook for any lossed stimulus funds, and any economic losses incured from delays in the capital project. this is discretionary, but I wonder how interested Wirtz will be if he has to cover the States losses.

Comment by Ghost Wednesday, Aug 26, 09 @ 11:43 am
The AV allowing the changes to local government referrendum on video gaming was issued to SB 1595.

Comment by unclesam Wednesday, Aug 26, 09 @ 12:50 pm
I guess we can frame this photo. Quinn and Wirtz probably won’t be taking in any more games together this coming season! Oh well, Quinn was never a hockey-guy anyway.

http://images.google.com/imgres?imgurl=http://media.ca
nada.com/fae0b6fd-d281-4d23-840e-569bef1c674c
/wirtz510.jpg&imgrefurl=http://www.faceoff.
com/story.html%3Fid%3D347bc622-58c8-4770-8ef
d-ed6c83b4e74f&usg=__KrLXUV9d4bQN4SN8s
Wwk7zNgNHc=&h=420&w=510&sz
=82&hl=en&start=1&um=1&tb
nid=MzMBt3uChPHM9M:&tbnh=108&tbnw=131&prev=
/images%3Fq%3Dquinn%2Bwirtz%26hl
%3Den%26sa%3DN%26um%3D1

Comment by Chi Gal Wednesday, Aug 26, 09 @ 1:04 pm
There is a provision in HB255, the bill that among other things, purports to legalize video poker, that requires 25% of the eligible voters to sign a petition for a referendum banning video poker in the municipality. Gov. Quinn could not use his amendatory veto power on the provision for at least two reasons. One, General Assembly inserted into HB255’s companion appropriation bill, HB312, a provision stating that if anything is changed in HB255, HB312 has no effect, regardless of whether the Governor signs it. Two, conversely, the General Assembly put a provision into HB255 providing that it did not take effect at all unless all of the appropriations bill HB312 became law. This is unprecedented in Illinois law. Essentially, the Legislature tried to tie the Governor’s hands such that he could not exercise his constitutional veto powers. And they did it so to lock up the pork projects members wanted.

Comment by TheBoss Wednesday, Aug 26, 09 @ 3:48 pm
Go Rocky!!!

Comment by Ricketts Field Wednesday, Aug 26, 09 @ 9:35 pm