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Video gambling boosts bar revenue

Published: Tuesday, Jan. 15, 2013 12:03 p.m. CST

Bar owners in DeKalb County had hoped to make more money after installing video gambling terminals in their establishments. Now there’s proof.

Three bars – Karlsbad Tavern in Genoa, Houlahan’s Tavern in Waterman and Olde Tyme Inn in Sandwich – have raked in thousands of dollars in November and December just by operating terminals.

This is not including revenue the bar might have received from more customers.

“They’ve brought new faces into our business and that in turn helps business,” said Karl Gallagher, owner of Karlsbad Tavern, 413 W. Main St. He estimated that his food and liquor sales have increased by 10 to 20 percent.

Gallagher operates three terminals. According to records the Illinois Gaming Board – the state’s gambling overseer – publishes monthly, the three terminals produced $10,578 in net income in November and $8,398 in December.

Twenty five percent of a terminal’s income is funneled to the state, with another five percent going to the local government where the terminal is located. Three-fourths of a percent is directed to Scientific Games, the gaming company operating the network for the terminals.

The remaining 69.25 percent is divided evenly between the establishment hosting the terminals and the terminal operator. With these figures in mind, Gallagher’s revenue from his terminals for November and December would come to a little more than $6,600.

When asked if Gallagher suggested other businesses try their hand with video gaming terminals, he said “yes.”

The five terminals at Houlahan’s Tavern brought in $12,450 in November and $11,262 in December. Their total profits for the tavern for the two-month period: just less than $8,300.

Houlahan’s owner Tom Houlahan said people start playing the video gambling terminals around 3 or 4 p.m., “and they stay pretty busy all evening.” He also thinks they are increasing food and liquor sales.

“The first couple of weeks we had a big increase in food and liquor sales,” Houlahan said, estimating those sales to be up 15 percent. “But they do stay pretty busy, and we pick up in food and liquor as well.”

Olde Tyme Inn’s five terminals garnered $24,404 in November and $24,481 in December. The inn’s share for the two-month period was more than $17,000.

These three bars won’t be the only locations DeKalb County residents can get their video gaming fix for long. Terminals are in place, but not on, at Five Points Pub, 105 S. Main St., Kingston; KJ’s Tap, 518 E. Lincoln Highway, DeKalb; and Mardi Gras Lanes, 1730 Sycamore Road, DeKalb.

Employees at each of these locations stated that their machines should be on this week.

Meanwhile, Joe Reisman of J & K’s Half Moon Tavern in Hinckley is waiting on word for when his machines will arrive. He said he was approved for a license two weeks ago; he said he hoped it was his terminal operator when the Daily Chronicle called last week for an interview.

Although people have been asking about the machines, Reisman said he has no idea what to expect in terms of a profit boost.

“I’ve talked to other business owners who said it hasn’t made any difference, and others have said it has made a lot,” Reisman said.

Reisman said he will have five machines installed, and that if they don’t work out, he can always have them removed.

“I’ll wait and see what happens,” Reisman said.

Meanwhile, 24 bars and veterans organizations in the county are awaiting action from the gaming board on their license. A spokesman for the board said there’s no definite time table for license approval, as the board is facing a backlog.

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