A new bill in the state legislature could give Illinois sports betting some further tweaks just months after the last adjustment. It could also expand the market as demand for online-only sportsbook licenses in the state has cooled.
Under the bill’s provisions, sports teams in Chicago could apply for the same type of licenses that casinos in Illinois have when it comes to sports betting. The bill includes a provision that could lower the cost, too.
New Illinois sports betting proposals in the works
Illinois Rep. Lamont J. Robinson, Jr. filed HB5847 on Nov. 21. The bill does not yet have a companion in the Illinois Senate. Furthermore, it still awaits a committee designation.
The bill could potentially expand the number of sports betting options in Illinois. Among the bill’s main tenets are:
- Allows eligible sports teams to apply for a master sports betting license
- Creates a system in which the licensing fees attached to that license may be reduced
- Expands the area over which such an entity may offer online sports betting
Under the bill’s terms, several Chicago teams would fit the definition of an “eligible professional sports team.” Those could include entities like the Chicago Bears, Chicago Bulls, and Chicago Cubs.
The bill would alter the status quo in Illinois in some key ways.
But aren’t some Illinois teams already involved?
There are plans to open a DraftKings Sportsbook near Wrigley Field. Furthermore, FanDuel has designs on doing the same at the United Center. Those ventures involve the teams that play in/near those venues but not directly.
Currently, Illinois law allows the owners of venues where such teams play to apply for a specific type of license. That license allows those facility owners to erect physical sportsbooks and offer online sports betting over a five-block radius.
In the case of the Cubs, the same entity that owns them also owns Wrigley Field. However, other Chicago teams lease the spaces for their games. Examples include the Bears and the Chicago Sky.
Thus, under the current law, teams like those can’t get in on sports betting themselves. This bill would change that, allowing them to apply for the same kind of licenses that casinos in Illinois are eligible for.
For that reason, they would be able to also offer online sports betting statewide as opposed to just within a five-block radius. The bill could reduce the cost of such a license, too.
Reduced fees for minority inclusion
The bill also includes a provision that would cut the fees associated with a master license for a sports team in half. The bill allows such a deduction for teams that qualify as a “social equity applicant.” The bill grants that designation to applicants if:
- All stakeholders with at least 10% equity in the applicant are at least 15% minority-owned, women-owned, or owned by persons with disabilities
- All stakeholders with at least 10% equity in the applicant reported no more than $50 million in income during the previous tax year
Social equity applicants must satisfy both criteria. The bill also allows teams to assign a designee to operate their sportsbook interests on their behalf. Thus, readers should not infer this bill requires teams to take on new investors.
Instead, such a team could form a new corporation that fits these social equity parameters and then designate that corporation as its sportsbook operator. Such arrangements are becoming more common, with the practice currently in use in Maryland and Ohio.
While new licensing fees mean more revenue for the state, those are one-time expenses. This expansion aims to address another fault in Illinois’ gambling law.
Minimal interest in online-only licenses
The 2019 gambling expansion law in Illinois created another class of sports betting licenses for operators untethered to a physical facility in the state. Currently, three such licenses are available.
The problem is that no one seems interested.
Most of the major sportsbook brands contracted their way into the state via partnerships with casinos, horse tracks, or off-track-betting sites. DraftKings and FanDuel bought venues in Illinois to get their online sportsbooks into the market.
The online-only licenses cost $20 million to acquire. It’s a steep price to pay when you not only don’t have a facility partner to advertise for you but you’re entering the market years after your competition.
Eventually, Illinois might have to lower the asking price if it wants anyone to bite. That isn’t impossible.
Illinois has already altered its sports betting provisions once, allowing in-person bets on in-state college teams and ending in-person registration requirements. It might do so a second time with this bill.