Local governments across Illinois that allow video gambling are seeing their cut of the action grow once again. Municipalities and counties collected more than $7.6 million in additional revenue from video gaming terminals in 2025, pushing their combined haul to roughly $160 million.
That total — spread across nearly 1,100 local governments — marks a 5% increase over the previous year, according to Illinois Gaming Board records. The footprint expanded too: the number of establishments offering video gambling rose 2.3%, from 9,230 in 2024 to 9,441 in 2025, while the number of terminals climbed 1.8%.
For Many Suburbs, the Money Is a Bonus — Not the Goal
Despite the growing dollar figures, many suburban officials are quick to frame the revenue as a secondary benefit rather than a fiscal strategy.
In Palatine, which only began allowing video gambling in 2022 at the urging of local restaurant owners, the village pulled in nearly $235,000 from 64 devices last year. The funds are earmarked for capital improvement projects, and officials deliberately limited where the machines can go — no gas stations or standalone strip-mall parlors.
“It wasn’t done as a revenue grab. We’ve seen businesses invest those dollars back into their operations — updating menus, keeping prices down and renovating.”
— Jim Schwantz, Palatine Mayor
Schwantz added that the machines keep a low profile: “There’s no outside advertising. You wouldn’t even know it’s in some of our places unless you walked in and went looking for it.”
Slower Uptake in Warrenville
Not every community has seen a rush. Warrenville, which also opened the door to video gambling in 2022, expected more restaurants to participate. Instead, just four businesses offer it, and the city collected $60,031 in 2025 from 20 devices. The money flows into Warrenville’s capital maintenance replacement fund.
“We have a different set of criteria than other places. It has to be a location that serves food and has been in operation for over a year before they get a license.”
— Cristina White, Warrenville City Administrator
Lake County Ties Its Cut to Problem Gambling
The unincorporated areas of Lake County host the largest concentration of terminals in the state — 73 licensed businesses running 416 machines in 2025, generating more than $1.2 million in tax revenue.
By statute, the bulk of that money is steered toward a special fund that awards grants to social programs, with preference for efforts that ease the harms of problem gambling. The law requires $825,000 of the county’s annual collections go into that fund; the rest lands in the general fund.
“Gambling addiction has a real cost and hurts vulnerable people. That’s the reason we established a guaranteed amount.”
— Paul Frank, Lake County Board member
How the Money Is Split
The tax on the machines has been raised since Illinois legalized them in 2012, including an increase to 35% of net terminal income that took effect on July 1, 2024. For every dollar a terminal generates, the host municipality keeps 5%, the state takes 30%, and the business owner and terminal operator divide the remaining 65%.
Net terminal income is the money wagered minus the credits paid back to players. After the tax and a small fee for the statewide central communications system that links every terminal, currently 0.92% of net terminal income, the remainder is shared equally between the terminal operator and the licensed establishment. A licensed establishment may host up to six machines, and a large truck stop up to ten.
In Addison, Gaming Taxes Fund the Calendar
Addison posted one of the highest suburban totals, generating nearly $800,000 in video gambling taxes last year. Village Manager Joe Maranowicz said the revenue underwrites the community’s entire events calendar — but the village has also tightened its rules and capped new licenses.
“We put it all back into the community. Every event we have, the gaming revenue pays for all of it — that and cannabis taxes too. We want video gaming to be an accompaniment to the business, not the reason for the business.”
— Joe Maranowicz, Addison Village Manager
A Statewide Windfall
The local gains are a slice of a much larger pie. Illinois collected more than $955 million in video gambling taxes last year — and that figure comes despite Chicago maintaining its long-standing ban on the devices. With venue counts, terminal numbers and collections all still trending upward, video gaming’s role in funding Illinois communities looks set to keep growing.
No other form of gambling comes close to video gaming terminals as a source of tax money in Illinois. Through November 2025, statewide terminal revenue for the year had already passed $2.91 billion, while the state’s 17 casinos posted a record $1.94 billion in gross gaming revenue for all of 2025, up 15% on 2024. When lawmakers added the one-point terminal tax increase to the 2024 revenue package, it was projected to generate about $50 million for the state and roughly $10 million for local governments.
Chicago Moves to End Its Ban
The biggest holdout has now begun to change course. In December 2025, a City Council majority approved a $16.6 billion alternative budget for 2026 that lifted Chicago’s ban on video gambling; the version that cleared the Finance Committee assumed about $6.8 million in licensing fees from the machines. Mayor Brandon Johnson, who called the plan “morally bankrupt” in part because of its reliance on video gaming, neither signed nor vetoed it, allowing it to take effect on January 1.
Implementation has been contested. In early February 2026 the mayor still had not asked the Illinois Gaming Board to begin licensing, and Ald. Anthony Beale (9th) said he would send the board his own letter notifying it that the ban had been lifted. Later that month City Clerk Anna Valencia formally notified the board, and on February 26 the state started accepting applications from businesses hoping to run the machines in the city. Bally’s, which is building a permanent casino in the River West neighborhood, has argued that terminals in city bars would cut into the revenue and jobs its project was expected to deliver. When state lawmakers examined the issue in May 2025, projections put the potential gain from Chicago terminals at about $250 million for the state and $50 million to $70 million for the city.
“Legalization of video gaming would have direct impacts on our host community agreement with Bally’s.”
— John Arena, Chicago Intergovernmental Affairs Director, May 2025
