SB690 Passes in Illinois: LEGAL Sports Betting on the Way!

With every gambling expansion bill passed in the United States over the past few years, many different places have been given the moniker of “the new Las Vegas.” While many of the gambling industries of these states do not resemble Las Vegas’ at all, Illinois may be the first one to live up to Sin City – or Nevada as a whole – with the passage of SB690, which legalizes sports betting in Illinois and extends far beyond what we have seen in other states.

Yes, sports betting is now legal, but the bill paves the way for much more besides that. Just one of the allowances the bill has granted is the establishment of a casino in the Chicago area, something that has casino operators and patrons alike buzzing with anticipation.

SB690 was passed by the legislature on June 2 and sent to Governor J.B. Pritzker (D) on June 5. He has made statements in support of adding new forms of gaming to the state, and his signature is viewed as all but certain although he has 60 days from the time the bill was delivered to his desk to sign it.

Governor Pritzker Said That He Approves of Sports Betting as a Revenue-Generation Measure

Sports Betting Rules

Though it tends to get lost in the mix of all the other gleaming aspects of SB690, it is important to note that sports betting will also be legal in Illinois. There are actually six separate types of licenses that will be available, including occupational, supplier, and central system provider licenses, each with their own particulars and fee structures.

The main type of license that interests us is the master sports wagering license, which is what's needed before an organization can offer sports betting under its own name. The fee for obtaining such a master license is 5 percent of the applicant's gross gaming revenue for the previous year with a cap on the fee of $10 million. Each license will be valid for four years. Sports betting revenue will additionally be subjected to a 15% tax, which is a bit high but more or less in line with what we are seeing in other states.

Existing casinos will be allowed to apply for a license, but so too will horse tracks and sports facilities such as the Cubs’ Wrigley Field. Venues for athletic competitions will be able to install kiosks supporting sports wagering within five blocks of their locations.

Wrigley Field Is One of the Stadiums That Will Be Allowed to Host Sports Betting

Optimistic estimates hold that stadiums will begin taking wagers by the time the college and NFL football seasons kick off, but others are not so confident. The Illinois Gaming Board must still draft the needed regulations and approve of the licensees first, a process expected to take at least several months.

Sports betting will occur at brick-and-mortar facilities, but folks will also be able to place wagers online. The important thing to note about online sports betting, however, is that deposits into an online account must be made in-person at an approved, licensed facility at least during the initial phases of Illinois sports betting. This was done in an attempt to limit problem gamblers' ability to quickly reload thousands of dollars into an online account like you are able to at most offshore sites.

In order to place wagers on sports at a licensed facility, bettors have to be at least 21 years of age. Another interesting aspect of sports betting in Illinois is the fact that no licensees are able to offer odds on any competitions involving Illinois schools.

Official League Data

Perhaps the most interesting aspect of Illinois sports betting is the mandate requiring licensees to use official league data if they are offering live, in-game wagers or prop bets. This makes Illinois only the second state to include such a requirement after Tennessee legalized online sportsbooks, with a similar provision included, in April 2019.

Pro sports leagues, after ending their total anti-gambling stance, have attempted to insert integrity fees into all relevant sports betting legislation. These fees, generally stipulated as a percentage of betting turnover, are ostensibly designed to help the leagues fund anti-collusion and -cheating efforts, but they're widely viewed as a straight money-grab. No state that has made sports betting legal thus far has incorporated integrity fees into its laws.

Official data sources, controlled by the leagues, are a secondary attempt to capture some revenue. They will provide approved game information to the bookies in real time so that they can set the odds without relying on outside entities for a play-by-play account of what happened. There are undoubted benefits to such arrangements although one wonders why they must be demanded by law if they are really that useful.

Daily Fantasy Sports in the Doghouse

Daily Fantasy Sports (DFS) operators were one of the few stakeholders not entirely too pleased with the passing of SB690. The reason for this is that they will not be considered for licenses until the bill has been enacted for at least 18 months. In other words, we will not hear much of anything else regarding legal DFS operations in Illinois until at least Christmastime of 2020.

Further spurring the ire of the DFS industry is the fact that there will only be three licenses available for online-only operations, and they will cost $20 million apiece. Instate casinos and racinos will therefore be able to set up shop and get their businesses well underway before fantasy sports giants DraftKings and FanDuel will be able to enter the market.

These punitive measures were spearheaded by live casino interests, particularly Rush Street Gaming, which owns the Rivers Casino in Des Plaines. The stated purpose for the timeout was to penalize daily fantasy sports companies for continuing to serve the state after a 2015 attorney general opinion that DFS was illegal under Illinois law.

Understandably, DFS firms are annoyed by being singled out for special treatment under the Illinois gambling expansion rules. Jason Robins, the CEO of DraftKings, headed to Twitter to register his displeasure:

More Casinos Inbound

SB690 does not allow solely for the creation of one new casino in Chicago, but a total of six new casinos across the state. This is something that will up the casino count in the state from 10 to 16, a noticeable increase.

As for the size of these gambling operations, the Chicago venture is going to be the biggest, with more than 4,000 “gambling positions.” Casinos that will exist in Danville, Waukegan, Rockford, and Cook County will host a maximum of 2,000 gambling positions, and finally, Williamson County’s casino will be allowed to host a little more than a thousand gambling positions. If one does the math, that is more than 13,000 brand new betting positions for the state.

While that may seem like a dramatic increase (and it is), Illinois did not stop there. To assuage the fears of the 10 currently operational casinos, SB690 also increases the cap of gambling seats allowed at these sites, up to 2,000 from the previous cap of 1,200.

Horse racing tracks – of which there are three – will also be allowed to offer a more authentic casino experience as the bill allows for 1,200 gambling positions to exist at each track. And the gambling taking place at racetracks will not solely be slots and video poker because table games, such as blackjack and roulette, will be permitted.

Other Items to Note

As was mentioned on more than one occasion up to this point, the Illinois gambling expansion bill is massive, consisting of more than 800 pages. As a result of this, things tend to get lost in the details.

A massive detail has to do with gambling in Chicago’s two major airports – O’Hare and Midway. The bill outlines that the holder of the coveted Chicago casino license will also be permitted to fixate slot machines in both of the aforementioned airports. This is worth noting because the only other place in the US where you can gamble in an airport is at Las Vegas’ McCarren International in Nevada.

O'Hare Airport Will Most Likely Feature Slot Machines Along With Nearby Midway

Illinois currently allows for gambling machines to be placed in bars, restaurants, and truck stops, but SB690 increases the number of machines venues can lay claim to. Bars, restaurants, and other similar establishments can now boast five gambling machines apiece as opposed to the previously allowed four. Truck stops are allowed to have up to 10 gambling machines. Finally, the maximum allowable bet at these venues will be increased from $2 to $4 with these sites now also able to offer jackpots as high as $10,000.

Potential Impact

With all of these changes, estimates claim that a one-time bounty of $2.7 billion will be collected by the state once new casinos, gambling venues, sportsbooks, and gambling machines have been fully implemented. From then on, more than $300 million in annual tax revenues are expected.

As you can imagine, the prospect of massive tax revenues was a major contributing factor to the support SB690 received from state senators and representatives. While it's hard to exactly calculate all the ins and outs of Illinois state finances, because a lot depends on how various terms are defined, by any measure, they're not good. Debts are widely reckoned to stand above the $200 billion mark with a large fraction of the total representing unfunded pension liabilities. Illinois has received the worst credit rating of any state in the country.

Unlike in many other jurisdictions that have authorized betting on sports to begin, Illinois actually has a chance to achieve the revenue projections that are being bandied about. With a large existing brick-and-mortar casino scene, there are plenty of organizations in the mix that already have sizeable customer bases and experience in handling gambling enterprises. This may enable Illinois sports betting to reach its potential a lot quicker than in other states.

One sour note is sounded by the mammoth $10 million licensing fees. If there's any aspect of SB690 that threatens to scupper the entire project before it even gets underway, it is these exorbitant charges, which are among the highest in the nation.

Nevertheless, we could see more than a few companies bite the bullet and hand over these massive sums as happened in Pennsylvania, which has similarly huge upfront licensing costs for sports betting.

Licensed Online Poker Down the Road?

Illinois has had three waves of major gaming expansion: riverboat casinos in 1990, video gambling terminals in 2009, and the current addition of sportsbooks and additional casinos in 2019. Thus, it's not too farfetched to conclude that there will eventually be another round of adding new gambling to the mix, and it's likely that the next installment will consist of licensed IL online poker and casino games.

Indeed, the Prairie State has already seen online gaming legislation introduced with HB479 in 2017. Though this bill passed the state senate with a vote of 42-10, it languished in the House until the legislative session expired, and it was not taken up again in subsequent sessions.

Still, it seems we're getting closer to regulated Illinois online gaming, and the appearance of internet sportsbooks in the near future will make it exceedingly likely that instate gambling interests will push to supplement their online endeavors with casino and poker games.

If and when they're successful in doing so, Illinois could really give a shot in the arm to licensed USA online poker. New Jersey, Delaware, and Nevada already have a poker traffic sharing agreement in place although the only poker room that has benefited from it to maximum advantage so far is WSOP.com. Should Illinois join in this compact, it would make the prospect of interstate poker more appealing to other poker operators.

This is dependent on the Department of Justice's reinterpretation of the Wire Act being struck down because if the DoJ is correct, then interstate poker is against federal law, and only single-state online card games are legal. A lawsuit on this matter was decided against the Justice Department on June 3, 2019, but most observers expect the government to appeal, and we likely won't have a final verdict for a couple of years.

Bet Online Today!

While we wait for the legalized Illinois sports betting scene to emerge, you can wager at offshore bookies in the meantime.

The Illinois statutes against gambling have never been used to prosecute anyone for gambling online, and the various federal laws that might apply to this activity specifically target only the organizers and managers of the wagering sites, not individual bettors. Thus, you have nothing to fear if you elect to bet on sports online.

For a rundown of the best places to engage in sports betting over the internet, check out our page devoted to the leading American-friendly online sportsbooks. For casino games, like slots and blackjack, head over to our list of recommended internet casinos. And for thorough information on offshore poker sites, read our guide to the USA online poker scene.