A handful of Democratic Illinois lawmakers are once again trying to legalize internet gambling, but a gambling insider is doubting their chances. The bills, House Bill 3080 introduced by state Rep. Edgar Gonzalez Jr., D-Chicago, and Senate Bill 1963 introduced by State Sen. Cristina Castro, D-Elgin, are nearly identical to previous versions. This marks the third consecutive year that legislation has been proposed, with the latest version including a tax rate of 25% on adjusted iGaming revenue. Supporters of the iGaming bill claim Illinois could collect an additional $1 billion annually in taxes. iGaming would offer a variety of gambling options, including online slots, table games, and live dealer games. According to the American Gaming Association, eight states currently allow mobile gaming.
In this article, SBS will be going over the latest gaming news coming from Illinois along with some additional notes and thoughts regarding gaming in the state and beyond.
The Illinois Gaming Machine Operators Association is opposed to the idea, and Christopher Altruda, a writer and contributor for a national gaming outlet, said he is not surprised the Illinois Gaming Board is not on board as well the same report notes. “Taking on an expanded vertical like this as you’re still settling the expansion of what you had for brick-and-mortar casinos and online sports betting, it’s a very tall ask of this state agency,” Altruda said. At over 40,000, Illinois has more video gaming machines outside of casinos than any other state. You can find them at bars, supermarkets, and gas stations.
A spokesman for the Illinois Licensed Beverage Association recently told lawmakers that online gambling poses a risk to the hospitality industry, resulting in bars closing or laying off staff. Altruda said the legislation is facing a tough road ahead. “I think the video game terminals create a unique dynamic as it pertains to Illinois because they are so extensive throughout the state and the invested parties in terms of the bars and taverns … this made a very focused push on what would happen in terms of potential revenue cannibalization there as opposed to brick-and-mortar casino revenue,” Altruda said. The two measures are currently stalled in committee.
In the years since the COVID-19 pandemic temporarily shut down Illinois casinos, video gambling terminals, horse racing, and professional sports, the state’s gambling industry has seen an explosion in growth. Even the state lottery, which was launched 50 years ago, has experienced an expansion in recent years after a decade of stagnation. Total state tax revenues from all sources of wagering in Illinois, including the lottery, surpassed $2 billion in the last fiscal year.
While Illinois already allows sports betting on mobile apps, iGaming includes online casinos and other forms of online gambling that are currently outlawed. Per the same article, State Rep. Edgar Gonzalez, D-Chicago, asked a panel of his fellow House members earlier this month to imagine Illinois facing another financial downturn like the pandemic-recession of 2020 when Trump was finishing out his first term. That year, Illinois faced a major budget shortfall, though federal stimulus money ended up helping the state recover.
Noted in the same report, proponents of Gonzalez’s House Bill 3080 point out that plenty of Illinoisans are already gambling on the internet illegally, often facilitated by overseas-based websites. “Whether or not you choose to pass legislation legalizing iGaming, it is already here,” James Hartmann, a lobbyist for sports betting giant FanDuel, told the panel. “Right now, you can take out your phone and in five minutes, be gambling real money slot machines from the app store, unregulated and untaxed.”
Hartmann, who was heavily involved in drafting and negotiating Illinois’ legalized sports betting framework as a House Democratic staff attorney in 2019, said iGaming sites are “flooding the Illinois market” – and operating unscrupulously. Meanwhile, FanDuel, Draft Kings, and other sports betting platforms must adhere to the law’s strict requirement for age checks, problem gambling prevention notifications, and other protections to maintain their expensive licenses. “And so while these bad actors profit, none of it is being captured in tax revenue for the state of Illinois,” Hartmann said. He and others pushing the iGaming bill claim Illinois could collect an additional $1 billion annually in taxes on internet gambling. The estimate is extrapolated from a 2024 report commissioned by the Sports Betting Alliance, an industry group that represents the four biggest sportsbooks in the US and takes a regular pulse of gaming in the States.
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