Illinois online gambling
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Illinois Online Gambling

Illinois is the sixth-largest state in the US, and Chicago is the nation’s third-largest city. It is one of the most sports-dense states, too, and home to ten riverboat casinos.

It’s also a state in which online gambling bills have been discussed for several years without any tangible progress — at least until June 2019.

During an overtime weekend in the state capitol, lawmakers approved a broad expansion of gambling within a funding package just before the end of the session. Although it does not have any provisions for online poker, it does authorize both retail and online sports betting in Illinois.

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Illinois online gambling news

History of Illinois online gambling legislation


There was cause for optimism in Illinois in 2018. An active bill (H 479) was reintroduced directly into the House Rules Committee, putting it just a few steps from becoming law.

Legislators also indicated the possibility of an omnibus gaming package a la Pennsylvania, which would likely settle the issues of online gambling and DFS for good.

It’s that omnibus effort that gained traction. Subcommittees conducted hearings on a loaded-up expansion bill, which would have authorized a new Chicago casino along with all forms of modernized US gambling.


Entering 2017, Illinois was still locked in its budget stalemate. The new governor and his Democratic rivals weren’t seeing eye to eye on a number of issues, a hindrance the legislative process.

Legalizing online gambling appeared to be a substantial long shot, but it turned out to be an active year on that front. A handful of bills appeared over the course of 2017, each including different provisions for land-based expansion, online gaming, and daily fantasy sports:

H 479 is the one that got the most traction, passing a vote in the Senate. The bill included both fantasy sports and online gambling, a compromise designed to appease land-based casino operators who are opposed to DFS.

Although the bill did not meet the May deadline for passage, neither did a budget agreement. The legislature was forced into a “continuous session” overtime, during which H 479 was used as a bargaining chip to try to make progress.

The bill surfaced again during the special session, but no further movement came. The state finally managed to pass a budget package in August, but it did not include any provisions for online gaming.

There were still three relevant bills active in the House, including H 479. Once again, though, hopes were extinguished by inaction, and the bills were left to stagnate until the final legislative session expired.

As a busy 2017 came to an end, nothing had actually happened on the gaming front.


As was the case the year prior, 2016 was framed by fantasy sports legislation rather than movement on the online gambling front.

Rep. Michael Zalewski’s DFS bill was reintroduced in 2016 as H 3655, and a matching Senate bill, S 469 was also filed in the upper chamber. The House passed its bill in April and sent it up to the Senate for consideration. The Senate passed it a month later, returning the amended version to the House Judiciary Committee.

That’s where things went awry for H 3655.

Land-based casino operators were the primary opponents, drawing parallels between their industry and “DFS betting.” But another major stumbling block crept up during the legislative process, too.

During this time, Rep. Rita Mayfield was allegedly contacted by an industry lobbyist. Here are Mayfield’s partial comments via a report by Capitol Fax:

The email basically alleged in exchange for considerations, donations, that he could guarantee votes. That’s illegal. We have a former governor in jail right now for doing that. So it is an issue. It is why I am not comfortable voting on this bill. And I was originally a co-sponsor of this bill when it first came out….

…But because of the actions of your lobbyist, I am no longer comfortable voting on this bill. I know I have several of my members that are not comfortable voting on this bill, simply because of the implications of illegality.

In light of the pushback, Zalewski indicated that he would not call for a vote on his bill in 2016.


Online gambling talks were off the table for the next two years, while daily fantasy sports endured some time under the microscope.

Zalewski introduced H 4323, dubbed the “Fantasy Contests Act.” It was the first piece of legislation aimed specifically at DFS, but it was more of a conversation starter. Zalewski seemed to know it was unlikely to see much action amid the budget struggle.

Late in the year, Attorney General Lisa Madigan was asked to give her opinion on the currently legality of DFS in Illinois. She did, and it was not favorable to the industry.

Madigan opined that daily fantasy sports operators were in violation of Illinois law and requested that they cease operations within the state:

I enclose the Attorney General’s opinion concluding that the daily fantasy sports contests offered by FanDuel and DraftKings constitute “gambling” under Illinois law. In light of the opinion, we expect that both FanDuel and DraftKings will amend their Terms of Use to include Illinois as an additional state whose residents are not eligible to participate in contests unless and until the Illinois General Assembly passes legislation specifically exempting daily fantasy sports contests from subsection 28-1(a) of the Illinois Criminal Code of 2012.

Both FanDuel and DraftKings have chosen to continue to operate in defiance of the opinion. Both sites filed suit against the state AG.


Part of what was hindering the progress of gambling expansion in Illinois was a nagging $100 billion public pension shortfall. Gov. Pat Quinn had called the situation an “extreme emergency” and stressed that he wouldn’t move forward with gambling expansion until the issue was settled.

In the mind of Senate President John Cullerton, that put the brakes on online gambling talks, too. “We cannot take that issue up until we resolve whether or not we’re going to have new casinos in Illinois and that again is very difficult to predict,” he said.

Cullerton went on to express some frustration with the lack of legislative progress: “I’m not a fan of gambling, but we have gambling in Illinois. It’s called Hammond, Indiana. Two thirds of the license plates over there are from Illinois. So we’re losing money. We’re helping fund the schools in Indiana, not in Illinois. So we probably should pass something.”

It was an election year in 2014, though, and nothing of any significance was moving. In a hotly contested race, Quinn lost to Republican challenger Bruce Rauner, who leaned into the tape for 50.3 percent of the vote. Quinn was the only Democratic governor to lose his re-election campaign in 2014.

Rauner was the new governor of Illinois, and he was about as unfavorable to online gaming as his predecessor.


Illinois first considered online gaming legislation in 2013.

The state was actually debating a bill regarding the expansion of land-based casinos, including the addition of properties in Chicago and four other spots. Quinn vetoed the initial proposal, though, citing a few key objections.

Just days later, Sen. Terry Link submitted a new gambling expansion bill, and this one included both land-based and online components.

The bill, S 1739, aimed to legalize online gambling under the supervision of a new Division of Internet Gaming. The oversight body would have collected licensing fees of $20 million and enforce a 15-20 percent tax rate for operators. The proposal also included provisions for interstate gaming and a limited bad-actor clause.

The legislation went through several hearings and amendments in the Senate throughout the months of March and April. Online gambling was never something the governor was keen on, though, and it was too much to realistically bite off. It was removed in the final amendment before the bill passed out of the Senate.

The overarching issue of gambling expansion wasn’t settled in 2013 at all, so it seemed likely iGaming would resurface in 2014.

Inside Illinois’ land-based casino industry

In 1990, Illinois became the second state in the US to legalize riverboat casinos (behind Louisiana). The Argosy Alton Belle was the first to open in 1991.

In 2009, the state updated its gaming code with the “Video Gaming Act” which approved he installation of video game terminals in retail establishments.

Illinois’ brick-and-mortar gambling facilities currently consist of ten casinos licensed by the Illinois Gaming Board:

  • Argosy
  • Casino Queen
  • Grand Victoria
  • Harrah’s Joliet
  • Harrah’s Metropolis
  • Hollywood Aurora
  • Hollywood Joliet
  • Jumers
  • Par-A-Dice
  • Rivers Casino

There are also three horse racing tracks and several associated off-track-betting parlors licensed by the Illinois Racing Board:

  • Arlington Park
  • Fairmount Park
  • Hawthorne

Projected IL online gambling revenue

We expect Illinois’ regulated online gambling market to generate $1.72 billion in revenue during the first five years of operation.

With a tax rate of 15 percent on casino games and 15 percent on poker, Illinois could expect some $258 million in tax revenue over the first five years of regulated online gambling.

The total take for the state could be increased by additional license fees for suppliers, license renewal fees, and other fees not contemplated by our analysis.

In millionsYear 1Year 2Year 3Year 4Year 5
Online poker revenue$47$41$40$39$39
Online casino revenue$233$275$306$347$355
Total industry revenue$280$316$346$386$394
Tax from poker (15%)$7.05$6.15$6$5.85$5.85
Tax from casino (15%)$34.95$41.25$45.9$52.05$53.25
Total tax revenue (not incl. fees)$42$47.4$51.9$57.9$59.1

Upfront revenue from license fees

The bill calls for a $10 million license fee.

The fee is an upfront tax payment, so the state will receive what is effectively a lump sum payment as opposed to additional revenue (although it does have the benefit of being guaranteed; some licensees could stop operation before paying $10mm in taxes).

Licensing is open to:

  • Riverboat license holders
  • Tracks
  • Eligible ADWs

Additionally, recently published amendments to the bill appear to contemplate a widening of license eligibility.

Considering all of the above, we believe that a conservative estimate will see 13 entities apply for an operator’s license in Illinois, generating an upfront payment to the state of $130mm.

Additional license fees for suppliers, skins, and other ancillary providers could easily push that number toward $150mm.

Significant local economic impact

The experience in New Jersey suggests that online gambling operators spend roughly 25 percent of gross revenue on marketing expenses. The vast majority of that spend flows to local media, as national media campaigns are largely irrelevant for state-limited online gambling.

That translates to an expected local media spend exceeding $325 million in the first five years of operation.

Additional economic drivers include direct employment, indirect employment, and the complementary effect online gambling has on land-based casinos.

Image credit: Nagel Photography /
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