Illinois Strip Club Owners Will Not Challenge Amended "Pole Tax"

The Illinois Club Owners Association will not mount a constitutional challenge to the amended "pole tax" bill should it become law, according to Michael Ocello, president of VCG Holdings (which owns Roxy's, PT's and Penthouse in Metro East).

The adult industry has been lobbying hard against the bill as originally proposed by Sen. Toi Hutchinson in February. She wanted to tax strip clubs $5 per patron in order to fund aid to sexual assault victims, based on the notion -- hotly contested by the industry -- that strip clubs correlate with sexual assault.

In an April 13 letter to Hutchinson, an industry attorney all but threatened to sue and grind the collection process to a halt. He pointed down to Texas, where lawmakers tried to enact a similar law only to see it become mired in litigation, shifting the new public revenue into escrow pending the legal outcome.

"The difficulty with collections, enforcement and very expensive legal challenges which are certain to follow the enactment of this bill render it extremely costly to the citizens of Illinois," the attorney wrote to Hutchinson. "For all the foregoing reasons, I respectfully request you vote against this bill."

Since then, Hutchinson has rewritten the bill to give strip clubs that serve alcohol two choices: Charge only a $3 tax per patron (which will probably get passed onto the customer at the door) or allow the club to pay an annual flat rate based on their taxable income.

"I still will argue vehemently that we do not cause the problem [of sexual assault]," says club owner Ocello, who is also a part-time police officer in Centreville, Illinois. "But this is a reasonable solution."

He adds that he was able to get an interesting concession from officials.

"We've met with Senator Hutchinson and the Lt. Governor's office, they have even said that they don't think we're the cause of some of these things [sexual assaults], but that they're just trying to fill a shortfall for something really important."

As for the new tax he must pay, Ocello concludes: "I don't like it, but I don't like a lot of taxes we have to pay."

A vote on the amended Senate bill has not yet been scheduled.