Sen. Cristina Castro is pessimistic about Illinois' chances of passing online casino legislation before 2023

Illinois Internet Gaming Act To Remain In Hibernation Until 2022

The Illinois legislature is back in session, albeit briefly. The Senate and House reconvened on Tuesday for a six-day veto session that will take place in two blocks of three days each, from Oct. 19-21 and Oct. 26-28.

This session, which would ordinarily happen a little later in November, was thought to be the last hope for the Internet Gaming Act (IGA) in 2021. That bill, sponsored by Rep. Robert Rita in the House and Sen. Cristina Castro in the Senate, would have added online casinos and poker to the state’s existing online and retail sports betting market.

Sadly, the state appears to be drawing dead in this hand, at least. After learning of the final dates for the veto session, Online Poker Report reached out to Sen. Castro to ask if we could expect the effort to continue. A short and to-the-point response arrived on Wednesday morning from Maggie Lenkart, an intern working in communications for the Senate Democrats.

Internet gaming legislation likely won’t be heard during this veto session, but the senator remains committed to working with stakeholders on bringing an iGaming option to Illinois.

Instead, the legislature will be considering other issues, such as redrawing congressional districts and possibly repealing a controversial abortion law.

That doesn’t mean the bill is dead, however, merely dormant. The Illinois legislature works on a two-year cycle, and 2021 is only the first year of the 102nd General Assembly. Thus, the IGA will still be on the table when the legislature reconvenes in the second week of January.

IGA provides a lot to be excited about

As disappointing as it is that Illinois online casino legislation won’t happen this year, the state is still in a good place. The IGA created a lot of excitement when it first appeared, and for good reason.

It’s a big state, for one thing, with only slightly less population than Pennsylvania. The latter is, of course, the largest state to have legalized online gambling to date. Illinois sports betting has also been going well. To date, the market has generated nearly $6 billion in handle, over $460 million in revenue and almost $72 million in taxes.

The bill itself is almost perfect. For one thing, it aims to get Illinois iGaming off the ground as quickly as possible. It directs the Illinois Gaming Board to do so by way of emergency rules and gives it a short deadline to do so. It also instructs the board to copy other states’ rules as much as possible rather than reinventing the wheel. That’s important in an industry where state-by-state regulation often leads to inconsistency and chaos.

Furthermore, the bill is forward-thinking when it comes to interstate gambling. That’s particularly important for online poker, where interstate traffic sharing is the key to success. Unlike other states’ bills, which have generally left this as something to be figured out later, the IGA expressly permits the Gaming Board to enter into such compacts.

The only real downside to the bill is that it imposes an in-person registration period on operators. A similar rule led to a slow start for Illinois sports betting. Fortunately, the one contained in the IGA is only a six-month period, which would only be a nuisance, not a disaster.

Will 2022 be the year? Don’t count on it

Just as the primary legislative session was winding down this spring, the Senate asked for a study on the potential tax revenue online casinos would create. The deadline for that report was Oct. 1, which is one reason there was speculation the issue would come up during the fall veto session.

Though that won’t happen, the report itself is complete. In fact, it came in well ahead of schedule in July. Depending on the tax structure, it estimates Illinois’ annual online casino tax revenue would be anywhere from $75 million up to $230 million. Even the low end of that is significantly more than sports betting is currently producing.

However, it cautions that online casinos could cannibalize much of that revenue from the state’s existing video gaming terminals (VGTs). It points out that the VGTs themselves did the same thing to Chicago area casinos.

This is, of course, a common refrain. Moral opposition to gambling sometimes prevents states from getting gambling expansion bills off the ground. As those efforts come closer to fruition, however, the more critical resistance often comes from stakeholders in existing forms of gambling, who worry about competition.

Sen. Castro, speaking to PlayIllinois over the summer, was pessimistic about her bill’s chances in the coming year:

I don’t know if it can be done in a year. It’s going to take time to educate my colleagues on what iGaming is and what it isn’t. There are people with concerns, and we need to address VGTs. Maybe we set up the groundwork over 2022 and look at 2023 to pass it.

Either way, Illinois is a favorite to legalize online casinos at some point. However, iGaming legislation is almost always a frustratingly slow process, and it looks like the Prairie State will be no exception.

- Alex is a journalist from Dartmouth, Nova Scotia, Canada. Now site runner for Online Poker Report, he has been writing about poker and the online gambling industry in various capacities since 2014.
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