The Illinois House of Representatives is reviewing legislation that would regulate and legalize online gambling and daily fantasy sports. Earlier the state Senate voted 42-10 to approve the proposal, which, supporters said, could generate more than 0 million within a few years to help the state fill its .6 billion budget gap.
Internet games were included in the bill to appease casino operators, in particular Rush Street Gaming, which operates Rivers Casino near Chicago. Casinos consider fantasy sports as competition, but have long desired to get a share of online gambling. State Senator Kwame Raoul, sponsor of one of the online gambling bills, said, “There was controversy last year as to why are we regulating daily fantasy sports activity, which is ongoing in the state, and not regulating internet gaming, which is also occurring. So what this bill attempts to do is also regulate and bring licensure and supervision of internet gaming under the jurisdiction of the gaming board. And it would limit the operation of internet gaming to existing casinos.”
Under the bill, a new Division of Internet Gaming, administered by the Illinois Gaming Board, would supervise online casino and poker games. Only currently licensed casino and horseracing operators would be able to apply for an online gambling license; horseracing operators would have had to conduct a minimum of 30 days of live racing in 2016. Remote advance deposit wagering firms also could to apply, as long as they had processed a minimum of $1 million in Illinois-based handle last year. A $10 million deposit would be required to cover any future tax obligations. Operators would have to pay a license fee of $250,000.
For the first five years of operation, online gambling operators’ first $100 million would be taxed at 10 percent, then they would have to pay a 15 percent tax on gross gaming revenues.
Regarding DFS, last year a DFS bill was approved in the Senate but stalled in the House. Under the proposed bill, operators would be required to pay a 5 percent tax on their first $1 million in revenue; then a sliding scale would assess a 7.5 percent rate on any additional earnings up to $3 million, 10 percent between $3 million and $8 million and 15 percent beyond that.
DFS operators would have to pay license application fees of $500 for annual revenue of less than $100,000, $12,500 for annual revenue between $5 million and $10 million and $25,000 for more than $10 million a year.
Finally, the newspaper reported that annual license fees for Illinois daily fantasy sports operators would follow a similar pattern with prices ranging from $1,125 for the smallest firms up to $50,000 for the top earners.
