TL;DR
Over the past half-decade, video gaming terminals have quietly transformed from tavern amusements into another engine in Batavia’s local economy. Between July 2021 and July 2026, patrons of local establishments wagered nearly $214 million into these machines, resulting in almost $19 million in player losses. With gambling restrictions once again on the agenda for city council we’re looking at the numbers over the past five years.
The 5-Year Financial Ledger (2021–2026)
To understand the scale of Batavia’s gaming landscape, we need to track the trajectory of the gross handle (Total Amount Played) and the Net Terminal Income (NTI), which is the gaming industry’s term for Total Player Losses.
While advocates often frame video gaming terminals as a lifeline for small businesses, an analysis of five years of Illinois Gaming Board data for Batavia shows a more nuanced reality.
The baseline years of 2021 through 2023 were characterized by steady, predictable volume across 8 to 9 active establishments. However, the period between 2024 and 2026 marked an expansion phase, peaking at 14 active establishments and 63 terminals. Consequently, total wagers surged, passing $49 million in the 2024-2025 reporting cycle.
The Five-Year Video Gaming Terminals Leaderboard
A closer look at establishment-level data reveals that a handful of venues dominate Batavia’s video gaming terminal market. The leaderboard is sorted by Total Player Losses (NTI).
Table 2: Batavia Establishment Leaderboard (Sorted by 5-Year Total Player Losses)
| Rank | Public Establishment Name | Terminals | Total Played | Total Won | Total Player Losses (NTI) | Player Payout % (RTP) |
|---|---|---|---|---|---|---|
| 1 | Speedway | 5 | $45,558,241.76 | $41,553,433.59 | $4,004,667.77 | 91.21% |
| 2 | Rosati’s Pizza / Oasis | 5 | $33,308,932.59 | $30,245,942.62 | $3,062,989.97 | 90.80% |
| 3 | Crosstown Pub | 5 | $35,143,155.15 | $32,184,760.03 | $2,958,395.02 | 91.58% |
| 4 | Bulldog’s Cellar | 5 | $19,982,791.28 | $18,165,976.57 | $1,846,857.29 | 90.91% |
| 5 | Riverside Pizza & Pub | 5 | $20,600,427.59 | $18,823,851.50 | $1,776,576.15 | 91.38% |
| 6 | Moose Lodge | 6 | $14,397,958.91 | $13,000,376.27 | $1,397,626.01 | 90.29% |
| 7 | JT’s Tavern | 5 | $13,939,929.59 | $12,699,378.48 | $1,240,551.11 | 91.10% |
| 8 | VFW Post 1197 | 5 | $9,149,637.02 | $8,400,116.54 | $749,520.48 | 91.81% |
| 9 | Wilson Street Tavern | 4 | $6,710,113.50 | $6,057,709.20 | $652,404.30 | 90.28% |
| 10 | Pal Joey’s (Inactive) | 5 | $7,285,970.76 | $6,773,513.87 | $512,454.67 | 92.97% |
| 11 | Overflow | 4 | $3,834,598.60 | $3,465,702.82 | $368,919.68 | 90.38% |
| 12 | Funway | 4 | $3,215,366.43 | $2,894,593.60 | $320,793.21 | 90.02% |
| 13 | East China Inn | 5 | $367,117.84 | $325,332.43 | $41,786.16 | 88.62% |
| 14 | Gammon Coach House | 5 | $459,086.97 | $425,454.00 | $33,632.97 | 92.67% |
(Data aggregated from 2021-2026 IGB annual reporting. Pal Joey’s is flagged as inactive, having dropped off the reporting ledger following the 2022-2023 cycle.)
Expanded Player Odds & Payout Analysis
Over the 5-year cycle, what the players won shows some variance across establishments. The highest payout rates belonged to Pal Joey’s (92.97%) and Gammon Coach House (92.67%). Conversely, East China Inn (88.62%) and Funway (90.02%) delivered the most punishing odds for local players.
These payout variances are not driven by luck, but by structural mathematics and terminal software profiles:
- Game Portfolio & Volatility: Terminals favoring low-volatility games like video poker naturally run a higher winning percentage compared to highly volatile, themed penny slots engineered for frequent, small wins but wider profit margins for the house.
- The Law of Large Numbers: High-traffic venues like Speedway or Rosati’s have logged a lot of wagers, forcing their payout percentages into a tight, mathematically programmed convergence (~91%). Conversely, lower-volume locations experience greater short-term statistical variance.
- Operator Configurations: Licensed corporate terminal operators program the pacing and limits on these terminals to achieve desired target margins and potential player profiles.
Regardless of short-term variance or high winning percentages, the core mathematical reality is unavoidable: cumulative losses represent permanent wealth loss for players. The house—or in this case, the terminal operator—always wins.
The Fiscal Plumbing & The 50/50 Split
When a resident loses $100 in a Batavia video gaming terminal, the money is divided by the plumbing under the Illinois Video Gaming Act.
- The State of Illinois deducts roughly 29% for state taxes and central communications system fees.
- The City of Batavia receives a 5% cut.
- The remaining ~66% of the loss is subjected to a strict 50/50 split between the host business and the corporate terminal operator (e.g., Accel, Gold Rush, J&J Ventures) who owns and maintains the terminals.
Only about 33% of players’ losses stays in the register of the local Batavia business. Another 5% goes to City Hall. Over five years, that means roughly two-thirds of the nearly $19 million lost by local players—over $12 million—permanently left the local community, funneled to state coffers and corporate operators headquartered elsewhere.
Local Commerce vs. Wealth Extraction
Analyzing video gaming terminal expansion through the lens of municipal finance requires looking at the “substitution effect”—what happens when disposable income spent on gaming displaces spending on dining, retail, and community services.
A stark contrast emerges when comparing video gaming terminal tax yields against Batavia’s dedicated 2% Municipal Liquor Sales Tax. Batavia’s liquor tax, which relies on the active consumption of goods, generates approximately $360,000 to $430,000 annually. By contrast, the City’s 5% share from video gaming terminals has yielded between $168,958.65 and $224,970.50 annually.
Traditional excise taxes reflect circulating commerce. A dollar spent on beer or food requires kitchen inventory, front-of-house payroll, and supply chain logistics, which vibrantly support the downtown ecosystem. Conversely, video gaming terminal taxation is essentially a fractional royalty on raw wealth extraction.
Furthermore, as the number of terminals expanded in Batavia, the financial impact per terminal evolved:
- 2021–2022: $84,479 lost per terminal
- 2022–2023: $80,109 lost per terminal
- 2023–2024: $78,971 lost per terminal
- 2024–2025: $74,506 lost per terminal
- 2025–2026: $66,548 lost per terminal
While market saturation and the addition of 23 new machines slowly diluted the extraction efficiency per terminal, the aggregate drain on the local economy continued to climb, clearing $4.1 million in player losses over the last reporting year alone.
Operational Shifts & Customer Dwell Time
The influx of video gaming terminals fundamentally alters the operational dynamics of local hospitality venues for some customers. The traditional tavern or restaurant model relies on a 45-to-60-minute “dwell time,” where patrons dine, converse, and turn over the table.
Video gaming terminals incentivize a pivot for some customers. Extended two-hour-plus solitary terminal sessions shift the operational focus away from food, beverage, and hospitality service toward stationary screen time. This transition reduces physical table turnover and alters the social fabric of the venue from communal gathering to isolated gaming.
Municipal Regulatory Context: Draft Ordinance 2026-031
Faced with an expanding gaming footprint and escalating player losses, the Batavia City Council is considering regulatory controls meant to halt gaming expansion, while providing “beefier” controls.
Key provisions in the draft ordinance include:
- License Caps: A hard citywide cap of 14 gaming licenses, coupled with a specific downtown mixed-use (DMU) zoning cap of 9 licenses, effectively freezing downtown expansion.
- Spatial Buffers: A mandate for 100-foot separation buffers from the property borders of parks, schools, and churches.
- Enforcement Powers: Enhanced mayoral revocation powers specifically targeting underage gambling violations and mandatory financial compliance.
- Use-It-Or-Lose-It: A sunset clause revoking any gambling license near a park, school, or place of worship that goes unused for twelve months.
By implementing these caps and buffers, the aim is to transition Batavia’s municipal policy from passive revenue acceptance to active economic defense—attempting to balance the fiscal survival of local businesses against the wealth extraction from the players.
Author: Jim Fahrenbach
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