Wednesday, June 17, 2009

More Poker, lets run some more numbers

Now lets talk numbers a bit, the 30% tax rate for the state is based on Net Terminal Income (page 72) that is money put into a video gaming terminal minus credits paid out to players.

So lets say you want the state to get $500,000,000 each year (sort of the middle of the $345 to $641 million range the Trib references).

500 Million is about 30% of $1,666,666,666.67 (really the 666 numbers are the way it works out, not an editorial)

So you need a Net Terminal Revenue Number of $1.7 Billion dollars for the entire state. or $37,037.04 per machine. In order to get to a Net Terminal Revenue number with an 80% payout (minimum allowed by law) you would need to have $185,185.19 bet per machine or about 8,333,333,333 bet statewide.

Again there is no way the average payout is going to be at 80% but I am giving the state the benefit of the doubt, without it, the numbers are even tougher to hit.

8,333,333,333 * .2 = 1,666,666,667 (Net Terminal Revenue)

So with about 8,300,000 people over the age of 18 in Illinois, it works out to each person will have to bet about $1,000 on video poker to hit the 8.3 Billion bet number.

Assuming you can bet $100 an hour, that would be 10 hours of play for every adult in the state or 83,000,000 man hours playing or each machine would have to be in use about 1,844 hours a year. Another way of looking at it each machine would have to average about 5 hours a day of $100 an hour play every day of the year.

Another number to ponder, to meet the net terminal revenue number every adult in the state would have to lose about $200 a year a video poker.


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