What you need to know about Illinois’ gambling expansion
Answers to frequently asked questions about new casinos and sports betting in Illinois.
The bill would allow for six new casinos – including one mega-casino in Chicago – and legalize sports betting statewide, among other changes.
Pritzker has indicated he will sign Illinois’ gambling expansion bill. Here’s what Illinoisans should know about it:
Where will the new casinos be located?
SB 690 would allow the Illinois Gaming Board to issue a license for a new casino in the cities of Chicago, Danville, Waukegan and Rockford, as well as one in Williamson County; and one license for a casino located in one of six south suburban Cook County townships: Bloom, Bremen, Calumet, Rich, Thornton or Worth Township.
How big will these new casinos be?
The Chicago casino will be the largest, with the bill allowing a maximum of 4,000 gambling “positions,” or seats available to place bets. Licenses for casinos in Danville, Waukegan, Rockford and the suburban Cook County township would each permit up to 2,000 positions; the Williamson County casino would have a maximum of 1,200 positions.
SB 690 would allow existing Illinois casinos, which currently operate under a limit of 1,200 gambling positions, to expand to 2,000 positions. Horse racing tracks will also be allowed 1,200 seats. Currently, only two of the state’s 10 existing casinos reach the 1,200 maximum number of positions, while three maintain fewer than 1,000 positions, according to ProPublica Illinois, casting doubt on Pritzker’s optimistic gambling revenue projections.
Previous attempts to bring a casino to Chicago involved calls for the city to assume ownership. The Chicago mega-casino authorized by SB 690 will be privately owned, with tax revenue split three ways between the city, state and casino operator.
Where will the Chicago casino be located?
The exact location is unknown and Chicago Mayor Lori Lightfoot has declined to speculate – but has indicated that she to move forward on the project quickly, according to the Chicago Tribune, with the goal of delivering a feasibility study before this fall. Pritzker said he would prefer the Chicago casino not be located downtown, according to the Chicago Sun-Times, but in an area that has “been left out” in terms of economic opportunity.
How much tax revenue will Illinois’ gambling expansion bring in?
In total, Illinois’ gambling could rake in $2.7 billion in one-time revenue at full implementation, according to revenue projections prepared by state legislative staff and reported by Capitol Fax. That would include all forms of new and expanded gambling, such as casinos, sports betting and video gaming. The expansion is estimated to generate $470 million in total annual recurring revenue afterwards.
In particular, the casino expansion is projected to bring in $360 million from one-time license, application and position fees in fiscal year 2020.
Other one-time revenue streams will come from bids on the new casinos, estimated to generate between $200 million and $300 million per license. Those revenues would collectively bring in between $1.2 billion and $1.8 billion.
One-time payments the state would begin collecting in fiscal year 2023 would bring in an estimated $630 million.
Recurring revenues from slot machines and table games would amount to an estimated $170 million and $17 million, respectively.
State revenues from the casino expansion, sports betting licensing, increased video gaming tax and a new tax on sports betting would go toward funding vertical infrastructure spending as part of Pritzker’s $45 billion capital plan.
However, these figures are only rough projections – and when it comes to revenue projections, Illinois has a history of reality falling short of expectations. This was on display the last time Illinois decided to expand gambling with promises of generous revenue windfalls.
When will the Chicago mega-casino open for business?
While there is no agreed-upon timeline yet, Lightfoot thinks Chicago could have a casino up and running before two or three years’ time, according to the Tribune.
SB 690 would allow the Illinois Gaming Board to establish rules under which casino owners and municipal leaders could negotiate a temporary gaming location during construction of a casino, meaning gambling could come even sooner than the completion of casino construction.
Will sports betting also be legal?
Yes. In addition to the casino expansion, sports betting would be legal in casinos, online and at Illinois’ most iconic sports venues.
Where can Illinoisans place bets on sports games?
SB 690 would allow sports betting at or within a five-block radius of a sports venue that seats more than 17,000 people. The Illinois Gaming Board could issue up to seven licenses for large sports venues.
Chicago’s Wrigley Field will be one iconic venue eligible for a sports wagering license. Other popular Chicago sports venues that could apply for licenses include Soldier Field, home of the Chicago Bears; the United Center, home of the Bulls and Blackhawks; and Guaranteed Rate Field, home of the White Sox.
Venues eligible outside the city will include SeatGeek Stadium in Bridgeview, the soon-to-be-former home of the Chicago Fire; the Chicagoland Speedway in Joliet; and World Wide Technology Raceway in southwestern Illinois. Allstate Arena in suburban Rosemont, Illinois, is also exploring the feasibility of allowing sports betting, according to the Sun-Times.
In addition to larger sports venues, SB 690 would also allow sports betting at new and existing casinos and horse racing tracks. The bill would bar sports betting license holders from accepting wagers on athletic events affiliated with universities.
SB 690 would also allow up to 5,000 sports betting kiosks, similar to lottery ticket kiosks. The bill would allow the installation of sports betting kiosks in as many as 2,500 licensed locations as part of a pilot program during the first year, with that maximum increasing by another 2,500 the following year. Large sports venues would be able to apply for licenses to operate sports betting kiosks.
When can Illinoisans begin sports betting?
SB 690 will go into effect immediately once it is signed into law, but it is unclear when Illinoisans will first have the chance to place bets. There are few details regarding the timeline for the rollout of the gambling expansion. Neighboring Iowa legalized sports betting in May, and is aiming to begin sports betting operations in time for the college football season.
Rulemaking is not often a quick process. Sports betting-eligible venues will need to seek licenses, then physically implement sports betting services in accordance with state and local regulations.
What about online sports betting?
SB 690 would freeze popular online-only sports betting platforms such as DraftKings and FanDuel out of the market for the first 18 months, allowing casinos to have first priority in the fast growing mobile market.
After casinos’ 18-month head start, the bill would allow up to three licenses total for online-only platforms, running $20 million each.
How much tax revenue is sports betting projected to bring in?
Sports betting alone would generate $240 million in one-time revenues from licensing fees, according to projections prepared by legislative staff, and somewhere between $60 million and $100 million in recurring annual revenues upon full implementation.
Since when can Illinois legalize sports betting?
In May 2018, the U.S. Supreme Court reversed a federal law banning sports betting in all but four states. The court’s ruling in Murphy v. National Collegiate Athletic Association opened the door for states across the nation to draft their own sports betting laws.
According to ESPN, eight states currently have “full-scale” legalized sports betting: Nevada, New Mexico, New Jersey, Pennsylvania, Mississippi, Delaware, West Virginia and Rhode Island.
Seven states have passed sports betting bills since the May 2018 ruling, including neighboring states Iowa and Indiana.
Will gambling be allowed at airports?
SB 690 would allow video slot and poker machines at Chicago O’Hare International Airport and Chicago Midway International Airport. However, each gambling position added to Chicago’s two airports would subtract from the 4,000 available positions for Chicago’s mega-casino.
Airport gambling would only be available to passengers who are part of a private club, not the general public.
How will Illinois’ gambling presence compare with other states
This gambling expansion will make Illinois the gambling capital of the Midwest, far surpassing neighboring states in total gambling positions. In total, SB 690 will increase Illinois’ total number of state-sponsored gambling positions to nearly 80,000 from 44,000, according to ProPublica Illinois.
Will this expand video gaming in Illinois?
SB 690 will increase the maximum number of video gaming machines to six from five machines per licensed location. This could bring the total number of video gaming machines in the state to more than 7,000. Maximum bets placed on each machine will increase to $4 from $2.
The bill would hike the state’s 30% tax on video gaming by 3%, effective July 1. The resulting 33% tax would go up another 1% July 1, 2020. Revenue from those tax hikes would go toward funding Pritzker’s capital plan.
Video gaming would bring in $40 million in state revenue and another $8 million at the municipal level, according to Capitol Fax. Estimated recurring revenue would reach $50 million in state revenue and $10 million locally.
A throw of the dice
Promises of riches from the state’s last gambling expansion fell short. In 2009, Illinois legalized video poker and slots to help fund a $31 billion infrastructure spending program. State lawmakers projected state revenues to reach $1 billion by November 2013. In reality, the state brought in less than $70 million by that date. Five years later, total state revenues were supposed to rise to $2.5 billion, but state coffers only saw $1.4 billion by November 2018.
Taxpayers eventually found themselves burdened with $10 billion in debt – a cautionary tale for those relying on uncertain estimates of future revenues for today’s spending promises.
Lawmakers expecting revenue from Illinois’ new gambling expansion to enhance infrastructure, pay down pension debt and fund an unbalanced budget might instead be plunging the state further into a fiscal hole.
While many Illinoisans are likely to see big changes at sports venues and in their communities in years to come, state leaders shouldn’t bet on an upturn in the state’s fiscal health.