was Joliet, Illinois.
From the outside it looked like a dark, brooding, sinister
place, made creepier by the fact that the first major building
you encountered was the fortress-like Illinois State Prison. At
that time the prison was the town's whole identity. Shipping had
long since vanished from the Des Plaines River. The railroad that
once sustained it was little more than a whistle-stop for the few
commuters into Chicago. And the neighborhoods were full of old
rundown gothic houses -- was it my imagination, or did they all lean
to one side, like witches' lairs?
When I revisited the city lately, I doubted my own memory of
what it once looked like. The downtown slums are gone. The
condemned buildings have been replaced by government offices and
plazas. The street lamps are new, the roads paved smooth as
glass, and the residential neighborhoods look like a picture of
all-American middle-class dreamland.
Say all you want about casino gambling -- in this case it's
transformed a wasteland into a city. The Illinois legislature
approved casinos in the early 1990s, awarding 10 licenses for
riverboats in cities that were economically depressed. To give
you some idea of how bad off Joliet was, it was the only city to
get TWO licenses.
Unfortunately, the lawmakers couldn't leave good enough
alone. They taxed the casinos at a higher rate than any other
state, then raised taxes again, then raised them a month ago to
70 percent of revenues, double the rate of the next highest
state, an amount so obscene that they'll probably choke off much
of the good that's been done here. Wall Street has already
panicked over the tax and advised investors to stay away from
Illinois. Bonds have been downgraded for companies with exposure
to Illinois. All capital improvement projects at the existing
casinos have been canceled.
It's grim -- and Steve Marshall, Vice President of Marketing
at Harrah's in Joliet, says it might get grimmer.
"The people doing this have absolutely no business sense
whatsoever," he says. "We're a politically easy target, and the
state has a $5 billion budget deficit. But these are private
companies, with hundreds of millions of dollars invested in
Illinois. There's much more upside for the state in allowing us
to grow our businesses. (Gov. Rod) Blagojevich is out of
control. It's unhealthy for the industry, it's unhealthy for the
employees, and it's slowly killing the business."
This is not the sort of talk you normally hear from casino
executives, who tend to be diplomatic to a fault. Obviously this
is all-out war.
You get some sense of what effect the new taxes will have
when you walk through the cavernous pavilion that fronts the
Harrah's barge on the Des Plaines River. For the first seven
years of Illinois gambling, operators were limited to cramped
riverboats that had to actually cruise every two hours -- an
annoyance to customers and an enormous expense. In 1999 the
legislature approved dockside gaming, and in October 2001
Harrah's became the first Illinois casino to replace its
riverboat with a roomy spacious barge.
It was supposed to be the first step toward developing a
lavish landside pavilion full of restaurants, shops, hotel towers
and the like. But it's mostly just a big empty hallway. "It's
been downsized," says Marshall curtly. "Just cosmetic changes
They did manage to complete construction on a 204-room hotel
that is definitely the finest lodging place for miles -- spacious
rooms with all the amenities and four high-roller suites. Ninety
percent of the rooms are given away to the casino's premium
"Actually our objective," says Marshall, "is not to have a
single dollar cross the counter. We want ALL the rooms comped. We
want that many good players here all the time. The hotel gives us
a good competitive advantage over (crosstown rival) Empress. Our
hotel is on the level of a Wyndham, the upper scale of hotels.
Theirs is more like a Hampton Inn, and it's not even connected to
(I've stayed in both hotels, and what he says is true.)
Joliet is probably the most competitive gambling market in
the state. Not only are there two casinos vying for each other's
business, but the city is just a 25-minute drive from the Indiana
state line, where four casinos are packed closely together in the
northwestern corner of the state, including another Harrah's in
East Chicago. Especially on weekends, many Illinois gamblers
would rather drive to Indiana, where there are no limits on the
number of slot machines. In Illinois, a casino can't have any
more than 1,200 "gaming positions," which is a formula that limits
slot machines to about 1,150 per property. Most Indiana casinos,
on the other hand, have at least 2,000, plus a lot more card and
"There's been a structural shift in the market," says
Marshall. "Indiana has had double-digit growth since last August.
We've taken it on the chin from them."
Faced with the inability to build new facilities, Harrah's
is forced back on that old standby known to casino managers
everywhere -- coddling and pampering the customer.
"Fortunately," says Marshall, "Harrah's has the customer
service edge, not just here but nationwide. As VP/Marketing, I
spend two hours a week devoted just to thinking about customer
interaction, trying to come up with more ways to make them happy.
We do a lot of customer service surveys. We try for continual
improvement, and we base everything on scores. Employees get
points for customer service, and bonuses are based on how well we
The other thing Harrah's does, here as elsewhere, is flood
the mailboxes of people who have a "Total Rewards" frequent-
gambler card. The Harrah's computer database is so sophisticated
that they can target a customer according to his past habits,
offering him precisely the giveways most likely to cause him to
get in the car and drive to the casino.
"Our customer is typically 40 to 60," says Marshall, "and he
lives in the south and western suburbs of Chicagoland. He makes
six trips a year, and he samples ALL the casinos."
What he samples is less than luxurious. Chicago has the
third-largest gambling market in the country, after Las Vegas and
Atlantic City, but its casinos lag far behind states like
Mississippi and Louisiana, which have better hotels, classier
facilities, and a lot more restaurants and shopping areas.
Harrah's/Joliet is limited to one high-end restaurant, a steak
joint called Van Buren's, plus a sports bar and a 250-seat
buffet -- which is excellent, by the way.
They're also forced to limit the number of table games they
can offer. "Over time we've yielded the casino floor to the slot
machine," says Marshall. "It just pays more per square foot." The
result: only 38 tables. (The competing Horseshoe Casino in
Hammond, Indiana, by contast, has more than 100.)
Entertainment, too, is woefully lacking. A very small
lounge, called Sevens, is open on weekends only. And the casino
sponsors just two or three live entertainment events per year at
the nearby Rialto Square Theater, which seats 1,800. Usually the
shows run to no-name attractions like the "Wheel of Fortune"
contestant search, although they recently brought in Don Rickles
for their 10th anniversary, and B-level acts like Howie Mandel
have worked there in the past.
There are no bus programs -- too expensive. ("The taxes
prevent that.") There were plans for an additional hotel tower,
but those have been canceled. Ten years ago, when Joliet was back
on its heels, Harrah's was welcomed like the long-awaited
economic savior. But now that the city is rejuvenated, it's
Harrah's that's most likely to be enlisted on the welfare rolls.
E-mail Joe Bob Briggs, "The Vegas Guy," at JoeBob@upi.com or
visit Joe Bob's Web site at www.joebobbriggs.com. Snail-mail:
P.O. Box 2002, Dallas, Texas 75221.
sidebar . . .
HARRAH'S JOLIET CASINO & HOTEL
151 N. Joliet St., Joliet, Ill.
Theme: Generic Slots o' Fun
Total investment: $130 million
Known for: Suburbanites with time on their hands
Marketing niche: Chicago day-trippers
Gambler's Intensity: Medium
Cocktail speed: Slow
Rare games: None.
Surrounding area: Downtown Joliet, which is sparkly clean
but has seen better days. There's no nightlife to speak of
outside the casino.
Web site: harrahs.com/our_casinos/jol/
Overall rating: 56
Joe Bob's bankroll: Down $40 after an hour of "Monopoly":
total to date +149
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