New Illinois Gov J.B. Pritzker, whose family owns the Hyatt hotel chain, is estimated to be worth $3.5 billion.
In his first budget address, new Illinois Governor J.B. Pritzker said he is counting on $200 million in sportsbook licensing fees as part of a plan to account for a $3.2 billion deficit in the state’s budget. Because the legislator has failed several times over the years to expand gambling, lawmakers and media groups expressed skepticism at Pritzker’s plan.
Pritzker, a 54-year old billionaire, acknolwedged the years of acrimony and gridlock on the gambling expansion (and state budgets), but he called on lawmakers to stop the partisan battles long enough to add expanded gambling to the budget bill.
The new governor did not call for more land-based casinos. He did not propose new forms of gambling to bolster the state’s pari-mutuel race tracks. Instead, he called on a one-time truce to legalize sports betting — a trend which is sweeping the United States at present.
On May 14, 2018, the US Supreme Court struck down a 25-year ban on sports betting in 46 states. Because the PASPA federal ban on sports betting allowed Nevada to have sportsbooks and 3 other states to have sports parlays, the SCOTUS determined the law was unconstitutional based on the equal sovereignty and commerce clauses of the US Constitution.
JB Pritzker Speech on Sports Betting
In a speech before a joint session of the Illinois legislature, Gov. Pritzker said, “Expansion of gambling is a perennial effort in this state, and often these proposals get bogged down in regional disputes and a Christmas tree approach. But in those instances, we were talking about adding more riverboats or adding into other regions.
“Sports betting is different. This is a new market created by a recent U.S. Supreme Court decision. Every day we argue about who’s in and who’s out is money that goes to other states and to the black market.”
Illinois Gambling Expansion
Passing any gambling expansion is going to be difficult, becuase of all the moving pieces in such a bill. With so many different gaming interests in the state of Illinois, each group has its own stance on any gambling bill.
Already, Illinois race tracks say they want a piece of the action. They are hiring lobbyists to push for sportsbooks at their tracks, which in turn might lead other gaming interests to call for sports betting. But some of those interests would need to alter gaming compacts, so that adds another level of complexity to the issue.
Meanwhile, the many small businesses across the state with video lottery terminals are concerned that sports betting might hurt their VLT businesses. One segment of the industry is inexorably tied to the other niches.
Ivan Fernandez, the Illinois Gaming Machine Operators Association’s executive director, said of the new sports betting bill, “We would hope…as terminal operators that we would be eligible to obtain a license and then be able to offer sports betting at our customers’ locations.”
The History of Gambling Bills
Kent Redfield, who teaches political science at the University of Illinois at Springfield, said of Illinois’s politics over gambling, “The history is that it’s hard to keep these (gambling bills) clean. But the history is also that, more often than not, when they become a Christmas tree, they collapse under their own weight.”
State Rep. Mike Zalewski, chairman of the House Revenue Committee, said finding a balance between the competing interests will be hard — but still is possible. Zalewski said, “We have to balance the amount of people interested in offering it versus concerns about oversaturation, and that’s a very tricky balance. It would be really early in the process to say, ‘Yes, a hundred percent, we can do whatever the stakeholders want,’ or ‘No, there’s no way we would allow any of these different interests to get what they want.'”
Gov. Pritzker’s plan is to offer 20 sports betting licenses. Each license would cost a $10 million licensing fee, thus producing the $200 million needed for the Illinois state budget.
Tom Swoik Supports Sportsbook Bill
Tom Swoik, the association’s executive director of the Illinois Casino Gaming Association, said his group supports such a bill, so long as the ICGA gets its cut. Swoik said, “My members are in favor of sports betting as long as the casinos can participate in it. We think that it’s one of the few markets left out there where expansion will help the industry and help the state, as opposed to additional casinos or slots at racetracks. That’s just going to shift money around.”
The Illinois Casino Gaming Association wants a clean bill with no other forms of gambling included. Swoik added, “It wouldn’t bother us if it was part of a package deal, but on the other hand, we’d just as soon see sports betting separate with the potential of having internet sports wagering as part of that platform.”
Of course, Tom Swoik said his association would prefer to leave a sports betting fee out of the final law. That would undercut one of the main reasons Gov. Pritzker is backing the bill, so a fee-less bill might be a non-starter.
Welcome to the complicated world of Illinois gambling legislation, Governor Pritzker.
