Last week, the Illinois Gaming Board approved Churchill Downs’ $400 million purchase of a majority stake in Rivers Casino in Des Plaines, Illinois. This transaction has led many to speculate that adding sports betting to Illinois’ largest state casino could be Churchill Down’s long-term play.
Adding to the momentum is that fact that Illinois Governor J.B. Prizker is in favor of sports betting in the Prairie State. However, in order for sports gambling to become legalized in Illinois there are several obstacles that must first be cleared. First, Illinois legislators would need to determine where sports gambling should be legalized (i.e., which locations will it be permitted in). In addition, there is always the issue of the taxing structure for both in-person and online mobile sports betting.
Furthermore, the Illinois Gaming Board must determine which entities would get the limited number of licenses. As we’ve seen in other states – racetracks and casinos will both be vying for a piece of the action.
There is certainly reason for these competing interests to find a common ground. It has been estimated that legalized sports gambling in Illinois could generate almost $800 million in annual wagers – which would mean big money for the state.
But, in order to succeed in Illinois, legalized gambling would have to compete with existing offshore betting. The key for lawmakers will be to set a reasonable taxing structure for legalized sports gambling. Currently, it is reported that Illinois may implement a process by which it levies a 20 percent tax rate on sports books’ gross wagering revenue, which some experts have estimated will generate in excess of $135 million per year in tax revenue for the state. Currently, online betting is projected to be the biggest source of potential income for the state if legislation is passed to legalize sports betting.
Illinois State House of Representative Mike Zalewski – the chairman of the House Revenue Committee, is expected to help draft Illinois’ proposed sports gambling legislation in the upcoming months. The goal would be to get it to the Governor J.B. Prizker before June 1, 2019.
While there is no guarantee that all the aforementioned hurdles can be cleared – there is certainly room for optimism as Representative Zalewski believes that it is a solid bet that sports gambling comes is legalized in Illinois.
Citizens of the Prairie state are known for being big time sports fans. Therefore, it seems like legalized sports betting in Illinois would be a perfect fit. If Governor J.B. Prizker approves proposed legislation this summer – we wouldn’t be surprised to see legalized sports gambling up and running in Illinois in 2020.
