By Matthew Walberg and Ray Long, Chicago Tribune reporters
October 8, 2013
A wave of video gambling establishments catering to women is starting to sweep across Illinois — cozy, well-lit spots with names like Stella's Place, Emma's Eatery, Dotty's and Betty's Bistro.
They're a far cry from the stereotypical male-dominated corner tap. In fact, at Lucy's Place, they'll cut a patron off after four drinks.
Owned in part by a pair of Springfield lobbyists, Lucy's Place has 20 locations in southern and central Illinois. And in coming months three new chains could open more than 80 cafes, most of them in the Chicago area, according to public records.
They're backed by heavy hitters, including veteran operators of gambling cafes in Oregon and Nevada. Another influential player is social gaming visionary Mark Pincus, one of the founders of Internet gaming giant Zynga.
Representatives from several of the companies said the venues provide a comfortable place for customers to gamble and are a positive addition to communities, bringing in revenue without the public safety headaches sometimes associated with bars.
But critics say the cafes prey on women and could exacerbate the plight of problem gamblers by making gambling even more accessible.
"Because of the stigma ... many women don't go into bars," said Anita Bedell, executive director of Illinois Church Action on Alcohol & Addiction Problems, an anti-gambling group.
"But these are labeled as country kitchens or upscale Starbucks, and that's why they're getting approved," Bedell said. "They're coming into neighborhoods, by shopping malls and schools, and it's making gambling too accessible in communities."
In northwest suburban Bartlett, officials have issued liquor licenses to two cafes, and two more are seeking approval. The village already has four bars or restaurants that offer video gaming, but Jim Plonczynski, director of community development, said he was impressed with what the companies had to offer.
The companies "are very upfront about the target demographic: women who don't want to go to bars and want to go out for drinks or a sandwich and gamble," he said.
Keith Whyte, executive director of the National Council on Problem Gambling, said that while his organization does not advocate for or against legalized gambling, the seemingly innocuous cafe setting raises concerns.
"They tell themselves they're just popping down to get a scone or see a friend or get some time away from the kids, but what they're really doing is engaging in the same kinds of activities as they would at a casino," he said. "It's just a different setting, but we know that setting can make a difference."
Further, they provide something experts say female problem gamblers seek — a safe, comfortable place to escape the stresses and worries of life.
The public needs to be aware that there may be some additional risk of problem gambling at these cafes, Whyte said. The evidence is not clear, but they may exacerbate gambling addiction among women, he said.
One of the architects of the state's video gambling rules said he did not anticipate these new gambling venues when he was crafting the legislation.
"I didn't take the position that these things were inappropriate. It was just something I didn't think about," said Rep. Lou Lang, D-Skokie. "I think maybe there is a place for these facilities."
Illinois Gaming Board officials have the power to intervene if the cafes improperly exploit the law, Lang said, adding that local governments can use zoning, planning and inspection rules to ensure conformity to community standards.
The Pincus factor
As part of its pitch to Bartlett officials earlier this year, Des Plaines-based Laredo Hospitality Ventures LLC provided a glossy handout showcasing three cafe concepts.
One of them, Stella's Place, is billed as "a neighborhood cafe and gathering place for adults to enjoy a light meal and gaming." Another, Maxine's, was described as "a contemporary take on the Rat Pack era," while Shelby's projects the feel of a small-town diner.
Plonczynski said the village has approved a liquor license for Stella's Place, which the state requires for a business to offer video gambling. Laredo Hospitality Ventures is also seeking a liquor license for Maxine's, he said.
One of the principals behind the company is Pincus, the former head of Zynga, an Internet game developer headquartered in San Francisco. The company operates online gambling in the United Kingdom but recently abandoned efforts to start online gambling in the U.S., according to news reports.
Pincus hung up on a Tribune reporter and did not return subsequent phone calls. Neither did his partners Gary Leff and Charity Johns. Leff founded the Stir Crazy restaurant chain and serves as lead design and development adviser for Rivers Casino in Des Plaines; Johns has held high-ranking positions with Starbucks, Cosi and Jamba Juice, according to Laredo Hospitality Ventures' handout.
Public records obtained by the Tribune show that Pincus and his company, WorkPlay Ventures LLC, which owns more than a third of Laredo Hospitality Ventures, are named on liquor license applications for Stella's Place locations in a host of towns, including Bartlett, Fox Lake, Minooka and Chicago Ridge.
Whyte said Pincus' success in building games such as FarmVille and Zynga Poker has given him a wealth of data on who plays social games.
"I suspect he's taking a lot of that experience and using it in a bricks-and-mortar way," Whyte said. "I think it's incredibly significant. He's going to get women that were playing his online game for 15 minutes and 50 cents to go to his cafe and spend three hours and $150."
Officials from Blackhawk Restaurant Group LLC in Oakbrook Terrace have also obtained a liquor license in Bartlett for Betty's Bistro.
The owners include the owners of the Elmer's Restaurants chain in Oregon, which features video gambling as well, said sports finance and administration specialist Michael Thiessen, who teaches at Northwestern University.
Blackhawk Restaurant Group has nearly 40 cafes, mostly in the Chicago region, awaiting approval to operate video gambling machines at Betty's Bistros and at three other cafe concepts — Jena's Eatery, Emma's Eatery and Penny's Place, records show. Thiessen said Blackhawk Restaurant Group is "a restaurant company first and foremost" but offers video gambling machines as an amenity.
Officials for Lucy's Place and Dotty's say they appeal heavily to women, the bulk of their customer base, but dispute specifically targeting women.
"I don't know that we target anyone," said Dan Fischer, CEO of Dotty's, which has more than 150 locations in Oregon and Nevada. He currently has 20 locations ready to open in the Chicago area once he receives approval from the Illinois Gaming Board. He said he would like to open 150 locations throughout the area.
Fischer said that 70 to 80 percent of his customers are women over the age of 35, a selling point for the company when he approaches local governments.
"I always like to tell folks that we're a great business because we have an adult customer that isn't focused on alcohol and likes gaming versus a traditional bar," he said. "We are relatively problem-free for a local police department."
'Not her thing'
Attorney Matt Hortenstine is part owner of Lucy's Place LLC, along with Christopher Stone, Jim Reimer Jr. and several other partners. Stone and Reimer operate Government Consulting Solutions Inc., a Springfield lobbying firm that represents alcohol distribution giant Southern Wine and Spirits, power company Ameren and other major clients.
Stone said he and Reimer were hired to advocate for video gambling in Illinois before the legislation passed in 2009 but did not push for language that would open the door for these types of gambling sites. After the bill passed, they visited other states that have these types of businesses.
"We started doing some research," Stone said, "and we're just like, 'Wow.'"
The company's video gambling terminals have yielded nearly $1 million since the first store opened in Marion in April, Hortenstine said. Under the law, about one-third of the money goes to Lucy's Place. The rest is paid out in state and local taxes and fees to an unrelated company that operates the terminals and another that monitors the games.
Hortenstine said he is skeptical of any suggestion that businesses like his contribute to an increase in problem gambling.
"It's not Anheuser-Busch's fault that there are alcoholics in the world any more than it's our fault that there are people with gambling addictions," Hortenstine said.
An employee stood behind the counter one day last week at the Lucy's Place on Denver Drive in Springfield, ready to serve candy, snacks, beer and wine to customers. Coffee is free. The place is quiet and perhaps a little sterile — sort of a cross between a bar and an insurance office.
Five gambling machines along two walls sport names like Mega Winner. They were alive with electronic sounds and spinning wheels flashing various colors.
Lisa Ribble plopped down at one of the terminals and settled in.
"I'm excited," Ribble said, sitting at a game called Kitty Glitter. She explained how it works: "You get all the cats in a row, and you get money."
Ribble, 47, a home health care worker, said she is making fewer trips to riverboat casinos now that video gambling is available at cafes like Lucy's Place.
Janet Hammer, of Orlando, Fla., often comes to the Springfield area to visit friends and family.
On more than one occasion, she's taken her mother to Lucy's Place.
"She's 84 and I think going to a bar is not her thing, it never has been," Hammer said. "She prefers places like Lucy's. You don't have people in here drinking. They're here to play the machines."
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