- Two companion iGaming bills have been introduced in the Illinois Senate, House
- License holders can partner with up to three iGaming operators
- Illinois Gaming Commission will not issue iGaming licenses to casinos that reduced their workforce
Two companion iGaming bills have been introduced in the Illinois Senate and House of Representatives, with the legislation attempting to address retail casino cannibalization concerns.
Sen. Cristina Castro (D-22) introduced SB 1963 to legalize iGaming, while Rep. Edgar González, Jr. (D-23) introduced companion bill HB 3080 in the House.
The Internet Gaming Act will allow legal online casinos games in the state and license holders to partner with up to three iGaming operators.
Addressing Cannibalization Concerns
The iGaming bills will tax online casino games at a rate of 25% of adjusted gross revenues. Operators will be able to deduct free play and promos from their gross revenues.
The fee for an iGaming license will be set at $250,000 and the license renewal fee will be set at $100,000. However, renewal of an iGaming license comes with another factor that addresses cannibalization concerns to retail casinos.
Included in the bill is a requirement that disallows the Illinois Gaming Control Board to award or renew an iGaming license to an organization if it has reduced its workforce by 25% or more since Feb. 28, 2020, or the issuance of an iGaming license.
“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 authors wrote in the bill.
It’s a clear attempt to dissuade casinos from reducing their employee pools after receiving an iGaming license. One of the main concerns from iGaming opponents, such as casino unions, has been employee cost cutting from brick-and-mortar locations after legalization.
iGaming Bill Details
The bill sets the minimum age to participate in iGaming at 21.
Each iGaming platform will have to include responsible gaming language upon users signing into their accounts. Each platform must display the words “If you or someone you know has a gambling problem, help is available. Call (toll-free telephone number)” or comparable language approved by the Illinois Gaming Control Board.
The language must include the words “gambling problem” and include a number to a problem gambling service when a user logs into their account.
Slots, poker, table games, and live-dealer simulcast games will be eligible under the bill.
All iGaming tax revenues will be deposited into the state gaming fund.
Illinois iGaming Bills Aim to Address Concerns of Cannibalization
In recent years, the state of Illinois has been considering the legalization of online gambling, also known as iGaming. However, one of the main concerns that has been raised by lawmakers and stakeholders is the potential for cannibalization of existing land-based casinos and gaming establishments.
Cannibalization refers to the phenomenon where online gambling takes away revenue from traditional brick-and-mortar casinos. This is a valid concern, as studies have shown that in some cases, online gambling can indeed lead to a decrease in revenue for land-based casinos.
To address these concerns, Illinois lawmakers have introduced several bills aimed at regulating iGaming in a way that minimizes the risk of cannibalization. One of the key provisions in these bills is the requirement for online gambling operators to partner with existing land-based casinos in the state.
By requiring online gambling operators to partner with land-based casinos, lawmakers hope to ensure that the revenue generated from iGaming will benefit the state’s existing gaming establishments rather than compete directly with them. This partnership model has been successfully implemented in other states such as New Jersey and Pennsylvania, where online gambling has coexisted with land-based casinos without significant cannibalization.
Another important aspect of the Illinois iGaming bills is the inclusion of responsible gambling measures. These measures aim to protect consumers from the potential harms of online gambling, such as addiction and financial loss. By implementing strict regulations on advertising, age verification, and self-exclusion programs, lawmakers hope to create a safe and responsible online gambling environment for Illinois residents.
Overall, the Illinois iGaming bills represent a balanced approach to regulating online gambling in the state. By addressing concerns of cannibalization and implementing responsible gambling measures, lawmakers aim to create a sustainable and thriving iGaming industry that benefits both consumers and existing gaming establishments.
