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Illinois Takes Step Towards Legalizing Online Casino Gambling

February 24, 2021

Given the rousing success of online sports betting in the state of Illinois, it was only a matter of time before state legislators were going to attempt to also legalize online casino gambling. That day has finally arrived.

Just this week, Representatives Robert Rita and Jonathan Carroll filed the Internet Gaming Act Under House Bill 3142.

Under the language of the bill, current brick and mortar casino operators in the state would be permitted to apply for licensing that would allow them to offer online casino gambling services to Illinois residents. The bill would allow each casino owner to apply for up to three skins, skins being the brand name of online casino websites.

The fees attached to this bill are rather stiff. Each casino would have to pay an initial fee of $500,000 for the gaming license and $250,000 a year thereafter for renewal. Management companies that would be enlisted to manage online casino gambling operations would have to pay a fee of $100,000. However, that fee could be discounted by 50% if the management company currently holds certification across other verticals within the state. The annual renewal fees for management companies would be $50,000.

As far as software developers and content providers, they would need to pay $50,000 to have their content included on any of the state's online casino websites. Again, software providers would get a 33% discount to $50,000 if they are already providing software content in other areas.

Finally, occupational licensing would be available for individuals who would be hired to make programming changes. The cost of this licensing would be $1,000 unless the individual is already licensed within the state's gambling industry. If that were the case, the fee would be reduced to $500 and a $500 renewal fee.

Other features in bill HM3142 include the ability for casinos to comingle operations across multiple jurisdictions. This would be of interest to online poker providers that would benefit by letting their customers participate in poker tournaments with poker players from other states.

Of course, tax rates are the primary interest of state legislation. Under this bill, the applicable tax rate on online casino gambling revenue would be set at 12% to be paid directly to the State Gaming Fund. It is noteworthy that $10 million of the money paid to the State Gaming Fund would be allocated to the Department of Human Services to provide problem gambling treatment services.

Should the bill get passed in the House, it would then get 90 days with the Illinois Gaming Board where provisions could be made for an emergency rollout. After everything has been put into place, the bill would go to the desk of Governor J.B. Spritzer for signing.


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