Illinois state Sen. Christina Castro filed a bill Wednesday looking to bring internet casino gaming to the Land of Lincoln.
The bill, SB 1656, would allow an “Internet gaming operator to offer Internet gaming.” It represents a subtle change from her unsuccessful 2021 legislation, SB 2064, which proposed authorizing “casinos or racetracks to offer Internet gaming or contract with a platform to offer Internet gaming” that would be regulated by the Illinois Gaming Board.
Castro’s bill allows for an internet gaming licensee to offer up to three branded skins and offers the possibility of interstate poker based on language that includes “acceptance of out-of-state wagers.” She again is proposing a 15% state tax on adjusted gross revenue that would be directed to the State Gaming Fund.
Castro’s filing raises expectations a corresponding bill will be filed in the Illinois House. Rep. Bob Rita, who is often the point legislator on all things gaming in Illinois, filed such a bill in 2021, calling for a 12% tax rate and also allowing for multistate poker.
Getting support for internet casino gaming in Illinois could prove challenging given the staggering amount of tax revenue already provided by video gaming terminals. The state received close to $786 million in taxes in the 2022 calendar year from VGT play — more than double the $302.9 million from casinos outside of sports wagering — as operators generated more than $2.7 billion in net terminal income. Local municipalities received an additional $135.5 million in tax revenue from the more than 45,000 VGTs in operation statewide.
Additionally, the expectation is that all six locations granted new casino licenses — including downtown Chicago — in the 2019 gaming expansion bill will all be in operation at either temporary or permanent venues at some point in 2023.
Other takeaways from Castro’s bill
Similar to her previous filing, Castro’s bill calls for no “home rule” taxes to be added to the state-imposed levy. This differs from sports wagering in Illinois: In addition to the 15% state tax for that gaming discipline, Cook County receives a 2% tax on operator revenue from all wagers made in the county — which includes the city of Chicago. There will be an additional 2% city tax in Chicago from wagers placed at sports facilities when those locations begin sportsbook operations.
Betfair recently filed an application to accept bets placed at the United Center through FanDuel, while DraftKings is expected to open its sportsbook adjacent to iconic Wrigley Field at some point this season.
Castro’s bill proposes an initial online gaming license fee of $250,000, with the length of the license to coincide with the applicant’s owner’s license or organizational license. The internet casino license renewal fee would be $100,000, but both fees can be pro-rated if an owner’s license or organizational license is issued or renewed.
The fee for an Internet Management Services Provider license that is required as part of an internet gaming license would be $50,000, with the license valid for four years. New applicants seeking such a license would be required to pay a licensing fee of $100,000 to the IGB, while existing license-holders would pay $50,000.
The IGB would also have the option to issue a temporary license within 30 days of receiving an application from any applicant that holds an equivalent sports wagering license or equivalent iGaming licenses in other legal jurisdictions. That temporary license would be valid for one year.
If Castro’s bill is passed, the IGB would have the ability to adopt emergency rules within 90 days of passage to begin administration.
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