Despite there being more than 800 pages to the new gambling law passed by Illinois’ legislature at the weekend, there is no room for online poker.
Due to Illinois’ legislative session coming to an end last Friday, it has been a busy past couple of days in Springfield. At the top of the agenda for Illinois´ lawmakers was finding ways to fund a much-needed $45 billion infrastructure improvement plan. The measures eventually settled on included an increased tax rate on gasoline, the legalization of marijuana, and an expansion of regulated gambling.
The expansion of regulated gambling consists of six new brick-and-mortar casinos, slot machines and table games at racetracks, and an increased number of licenses (and higher taxes) for video gaming terminals. It also allows the state´s existing casinos to offer both in-person and online sports betting. The expansion of gambling is expected to generate $700 million next year from licensing fees and taxes.
Contentious Exclusion of DraftKings and FanDuel
The issue of bad actors is one that´s been around since Illinois first tried to pass an online gambling bill in 2013, but it has never before been applied to sports betting. However, the concept of excluding DraftKings and FanDuel from the online sports betting market – to give Illinois´ casinos a fighting chance against the online giants – has been around for some time.
During a hearing of the House Revenue and Finance Committee in April, one potential operator said “who´s going to pay a $10 million license fee to get a minimal market share” and it seems as if legislators listened – initially proposing a three year blackout of all online betting, then amending the bill so that “online-only” operators would be excluded for a period of eighteen months.
The language of the bill (i.e. “online-only” rather than specifically naming the two excluded brands) could help the state avoid legal action being taken by the two companies. DraftKings has already stated it will
pursue whatever legal avenues we can; although considering the company has been operating its DFS platform in Illinois illegally since 2015, I can´t see many courts being sympathetic to its case.
No Room for Online Poker or Online Casinos
The text of the gambling expansion bill is contained within SB 690 – an 816-page long omnibus bill covering everything from parking charges to tax incentives for Cloud Services Providers to build data centers in Illinois. What it´s missing is any provision for the regulation of online poker and online casinos. This was largely expected after lawmakers dismantled plans to comprehensively overhaul regulated gambling in Illinois last year.
The piece-by-piece approach could delay regulated online poker and online casinos in Illinois for up to three years. Lawmakers will likely want to see how sports betting performs both before and after DraftKings and FanDuel enter the market; and although the state has a lust for tax revenue, it has fallen for the myth of cannibalization in the past and is likely to do so against considering the concessions made to Illinois´ brick-and-mortar casinos this time.
So, although the regulation of sports betting and its limited online element is a step in the right direction, it´s going to be a long time before residents of Illinois can play at a regulated online poker site. My guess is that it will not be at least until 2024 before the first hand of state-sanction NL Texas Hold´em is dealt on the virtual felt; but, considering how long it has taken the state of Illinois to reach this stage, it could be many years later.