Online casino legislation is back on the table in Illinois after lawmakers introduced companion bills in the Senate and House of Representatives that tackle the cannibalization concerns of retail casino operators.
Respectively, Sen. Cristina Castro and Rep. Edgar González, Jr. introduced Senate Bill 1963 and House Bill 3080 to legalize online casino gambling on Feb. 6. However, US gaming law and sports betting attorney Dan Wallach alerted his audience to their introduction on LinkedIn early this morning.
The Internet Gaming Act created by the new bills would allow licensees to offer iGaming in the state via partnerships with up to three operators.
Bills attempt to address cannibalization concerns
The proposed bills require an initial $250,000 licensing fee, with renewals priced at $100,000. However, the Act also stipulates that renewals be subject to conditions aimed at addressing the cannibalization concerns of retail casinos.
Specifically, the bills disallow the renewal of online casino licensing if the applicant has reduced its workforce by 25% or more. The calculations will be based on workforce numbers as of Feb.28, 2020, or the initial date of licensing.
From the bills’ text:
The Board may not issue an Internet gaming license to an owners licensee or organization licensee that has reduced the size of its workforce by 25% or more since February 28, 2020. The Board may not renew the Internet gaming license of any owners licensee or organization licensee that has reduced the size of its workforce by 25% since the date its last Internet gaming license was issued or renewed.
The stipulation clearly attempts to offset labor unions’ concerns over potential revenue and job loss at retail casinos.
As with online casino legalization elsewhere, opponents in Illinois are concerned online casinos will negatively impact casino workers and the video gaming terminal (VGT) industry. VGTs, which operate similarly to casino slots, are available in retail environments like bars and truck stops in many local municipalities. Illinois is home to over 45,000 such machines in over 8,600 locations.
As Bonus previously reported, according to Illinois Licensed Beverage Association executive director Keith Wetherell, online casinos could result in a 40% drop in related revenue.
With these bills, lawmakers are attempting to address the labor portion of that opposition.
Notably, Gov. J.B. Pritzker recently called online casino legalization “worthy of consideration.”
RG reminders required on every sign-in
Tax-wise, the bills propose a 25% rate on adjusted gross revenue, with operators able to deduct free play and promos. All related taxes collected will go to the state gaming fund.
The proposed legislation sets the minimum participation age at 21 and allows slots, poker, table games, and live-dealer simulcasts.
To further address problem gambling concerns, the bills require online casino platforms to deliver responsible gaming (RG) messaging. That includes greeting users with RG reminders when they sign into their accounts.
Specifically, operators must display the following language or a comparable message approved by the Illinois Gaming Board (IGB).
If you or someone you know has a gambling problem, help is available. Call (toll-free telephone number)
In the latter instances, the phrasing must include “gambling problem” and a helpline service number to receive approval.
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