Illinois Governor Rod Blagojevich, acknowledging his past year’s attempt to get new casinos and racetrack slots past state House Speaker Michael J. Madigan was a failure, now wants to lease out the Illinois Lottery to help fund the governor’s latest capital improvement program.

Blagojevich has downsized the planned budget for improving roads, schools and other infrastructure to USD 25 billion. When three or four taxable casinos and 4,000 racino slot machines were in the mix, he eyed USD 34 billion. Illinois has had no capital-improvements budget for a decade, partly because lawmakers worry about raising taxes to fund one.

The Daily Heraldof Arlington Heights noted that Blagojevich abandoned the casino quest – which he pursued for taxes, not because he favors more gambling – a week after the paper’s three-part series on the Illinois casino business.

It reported that casinos are tightening slot payouts to maintain profits as play slacks off in the current economy and that Illinois ranks low in the Midwest for gambling addiction programs.

The paper says the stories led some “suburban lawmakers” to shy from the casino support Blagojevich needs. Legislators defeated another Blagojevich lottery-leasing proposal early this year, and at least one chided the governor’s renewed hope for a multibillion-dollar upfront payment from a private company wanting to lease the state lottery. Residents accepted the lottery to fund education, not construction, said Rep. Barbara Flynn Currie, standing in for Madigan at the meeting where Blagojevich announced his plan.

Madigan was not there; he and Blagojevich revile each other and avoid contact whenever possible. But the legislature’s three other top leaders said many lawmakers could back the governor’s new program, especially if he signs an ethics bill they have sent him. That may not be known until the legislature resumes meeting November 11.