Illinois residents who fancy a gamble can pick from a broad range of activities, from in-person wagering on thoroughbred horses at Fairmount Park and commercial gaming at the Harrah’s Joliet to online sports betting, lotteries, and social gaming. All these activities are legal and regulated in the Prairie State.
The gambling opportunities here are not as abundant as those in states like Nevada, but this hardly impedes the growth of the local industry. Data released by the Illinois Gaming Board reveals the state generated over $1.7 billion in commercial gambling revenue in 2021 alone. The Prairie State is home to various gaming vendors and commercial casino operators that provide employment to over 15,300 residents.
The state government rakes in more than $923 million in tax revenue from authorized gambling businesses each year. Gambling-related tax money is crucial for the funding of the local public school system and its infrastructure. Ten or so commercial gaming venues are strewn across the state at the moment of writing. Riverboat casinos are also legal here but have started to phase out in favor of landbased operation.
A full-fledged online gaming industry is the only thing Illinois is currently lacking. The state legislature gave the thumbs up to online sports betting back in 2019, paving the way for the arrival of major sportsbooks like FanDuel and DraftKings. Locals also have access to daily fantasy sports and online lotteries, but online casino games remain illegal for the time being.
Gambling Laws in Illinois
Various gambling products are legal in Illinois but only on condition the operators have obtained licenses from the respective regulator. Running a gambling business without proper authorization is considered a criminal offense in Illinois. All forms of illegal gambling and the corresponding sanctions are outlined in the Illinois Criminal Code.
Illinois Criminal Code
Native American Gaming Compact Act
Illinois Gambling Act
Illinois Video Gaming Act
Illinois Lottery Law
Illinois Criminal Code
Gambling is illegal in the Prairie State unless it falls under the exemptions outlined in Article 28 of the Illinois Criminal Code. Said exemptions include authorized pari-mutuel wagering on horse races, video gaming terminals, bingo, poker, lotteries, raffles, charitable games, casino gambling, and sports betting. The legal provision of all these products requires a license.
Skill and chance-based games fall under the exceptions on condition players are not required to pay for participation. The possession of antique slot machines is not illegal provided the owners do not use them for unlawful gaming activities. Antique slots are those that have been manufactured at least twenty five years ago.
Redemption machines and crane games do not constitute illegal gambling devices under the Criminal Code. The Attorney General of Illinois has the authority to impose sanctions on those who violate the provisions outlined in Article 28.
People who operate illegal gambling on boats, in vehicles, or real-estate properties are guilty of Class A misdemeanors. Repeated offenses of this kind constitute Class 4 felonies, which are subject to imprisonment of one to three years and/or maximum fines of $25,000 for individuals and $50,000 for corporations. Class A misdemeanors are less serious so the conviction is imprisonment of less than a year (up to 364 days) and/or fines of up to $2,500.
Native American Gaming Compact Act
Native American casinos are those operated by sovereign nations on tribal lands in trust. Tribal gambling venues are available in many US states but Illinois is not one of them. One such casino can start legal operations in the state provided that the Illinois General Assembly approves the Governor’s compact with a federally recognized tribe under the Native American Gaming Compact Act.
Illinois Gambling Act
The Illinois Gambling Act is the statute that governs commercial casino gaming in the Prairie State. Governor Jay Robert Pritzker signed it into law in June 2019 to authorize games conducted in landbased casinos. The legislation enabled the already existing riverboat casinos to transfer their operations on land. It also authorized six new gambling venues that are yet to commence operation.
At the moment of writing, commercial casino gaming is available in the cities of Rock Island, Joliet, Aurora, Des Plaines, Elgin, Metropolis, Rockford, East Peoria, Alton, and East Saint Louis. The law allows for the operation of the so-called racinos, i.e. racetracks and casinos combined. For this purpose, the racetracks must acquire licenses for commercial gaming from the Illinois Gaming Board.
Authorized operators can offer slot machines, electronic games of chance, and table games on their premises. Under the terms of the 2019 Act, Organization Gaming licensees based in Cook County can operate no more than 1,200 gaming positions, while those based in other counties are entitled to a maximum of 900 gaming positions.
Those who obtain Owners licenses face restrictions of up to 2,000 gaming positions. A new casino project is underway in Chicago where the maximum gaming positions are capped at 4,000. Some of the allowed table games include craps, blackjack, house-banked poker, roulette, klondike, pai gow, sic bo, and baccarat.
Illinois Video Gaming Act
Slots and other gambling machines became legal in Illinois after the passage of the Illinois Video Gaming Act in 2009. The state decriminalized this form of gambling in an effort to generate additional tax revenue and cope with the effects of the global financial crisis that hit the country the previous year.
The legislation authorized the operation of up to five gaming terminals in licensed non-gaming venues such as drinking establishments, smaller truck stops, fraternal establishments, and veteran facilities. Larger truck stops can install a maximum of ten terminals. All licensed gambling machines undergo audits by independent testing laboratories approved by the Illinois Gaming Board (IGB). Their theoretical player return should be at least 80%.
Another provision in the legislation stipulates that the machines cannot pay directly by dispensing coins or banknotes. The player gets a receipt ticket instead and turns it in to an authorized employee to receive the cash prize. The allowed credit denominations include ¢1, ¢5, ¢10, ¢25, and $1, with a $4 wagering limit per round. Cash awards per round must not surpass $1,999, while the prizes from progressive and fixed jackpots should not exceed $10,000.
Illinois Lottery Law
State-sanctioned lotteries made their way to Illinois after the passage of the Lottery Law in 1974. The legislation created the Illinois Lottery Control Board (ILCB) which regulates this form of gambling jointly with the Department of Lottery (DOL). The ILCB has five members all of whom must be US citizens and residents of the state. No more than three of the five members can share the same political affiliation.
Unclaimed prizes and most of the profits generated by the state-sanctioned lotteries go toward the Common School Fund for the financial aid of K-12 public schools. The rest goes toward the Capital Projects Fund which uses it to improve the local infrastructure. The remaining portion of the proceeds is used for various social initiatives like multiple sclerosis research and breast cancer charities.
The state-sanctioned lottery is operated by the UK-based Camelot Group. Illinois residents have the option to purchase their tickets over the internet and have access to multi-jurisdiction games like Mega Millions and Powerball.
Licenses Required for Commercial Gambling
The Illinois Gambling Act allows for the issuance of several types of licenses related to commercial gambling. Interested landbased operators must apply for Owners licenses, while racinos require Organization Gaming licenses. Supplier permits are necessary for the manufacturing, sale, and distribution of gaming machines. The IGB has the remit to issue no more than sixteen permits for casino gambling operations and ten of those have already been granted.
Owners and Organization Gaming Licenses
Licenses for Video Gaming Terminals
Occupational Licenses
Owners and Organization Gaming Licenses
All three permit types require candidates to submit application forms with the IGB and pay the associated application fees. The companies’ chief executive and chief operating officers are subject to thorough investigation and must file full disclosure forms with the local regulator. The same applies to individuals that have voting rights and an ownership interest in the gambling company that exceed 25%.
The regulatory agency will then conduct a detailed review of the application, closely investigating the probity, financial capacity, and industry experience of the applicants. The education and criminal background of the candidates also bears consideration.
If the investigation findings are satisfactory, the regulators will order the issuance of an Owners or Organization Gaming license. At the time of publication, Illinois has two preliminary suitable candidates for Organization Gaming permits (Fairmount Park and the Hawthorne Race Course) and ten holders of permanent Owners licenses. The gambling permits issued by the IGB are non-transferable.
Licenses for Video Gaming Terminals
Applicants for the operation of video gaming terminals (VGTs) outside commercial casinos undergo similar investigations. However, the establishment’s owners and key management officers must also submit their fingerprints to the regulator. The IGB focuses mostly on the applicants’ criminal background and compliance with the state and federal tax laws. The establishments where the applicants plan to operate their gaming terminals undergo additional inspections.
Occupational Licenses
Occupational licenses are necessary for casino employees on the gaming floor. The minimum age requirement for dealers, boxmen, and other floor persons directly involved in the gambling operations is 21 years old.
Staff members that fulfill non-gaming functions should be at least 18 years old. The candidates for occupational permits must provide two sets of fingerprints. Candidates who submit false information, lack the necessary qualification, or have violated the state gambling laws are very likely to have their applications turned down.
Player Protection Measures and Responsible Gambling
Players must be at least 21 years old or older to enter the commercial casinos and racinos in Illinois. Lottery participation is possible for persons aged 18 years and above. Gambling venues cannot operate in the proximity of universities, schools, churches, and other places of worship. The Illinois Liquor Control Commission disallows giving away free alcoholic beverages inside casinos.
Other than that, local players who cannot keep their gambling activities in check can voluntarily add themselves to the state self-exclusion program. Exclusion is possible for a minimum of five years, after which period the rehabilitated gambler can request his or her removal.
It is at the operators’ discretion whether to continue servicing gamblers after their removal from the list. If the venue is part of a larger casino chain, the operator has the right to prohibit the excluded gambler from entering any of the affiliated establishments.
A separate registry is available to persons looking to exclude themselves from playing video gaming terminals outside casinos or racinos. Players who add themselves to the VGT registry get regular emails with advice and links to various prevention or treatment programs in the state. Unlike regular casino gamblers, problem VGT players can remove themselves from the exclusion registry at will. Also, the registry is available to both Illinoisans and problem players from other states.
Licensed operators must put up signs with information about receiving help for problem gambling at the exits and entrances of their venues. The Prairie State lacks any specific limitations on the marketing of gambling products and services.
Sports Betting Regulation in Illinois
Illinois was among the first states that jumped on the sports betting bandwagon after the 2018 repeal of the nationwide ban under PASPA. The State Legislature approved the Sports Wagering Act one year later in June 2019. The legislation paved the way for a gambling expansion in the state, allowing for in-person, online, and mobile wagering on professional sports, motorsports, and collegiate events.
Approved Retail and Online Sportsbooks
Licensing Fees and Requirements
No In-Person Registration for Online Punters
Approved Retail and Online Sportsbooks
Betting on the outcome of political elections is prohibited in Illinois. Commercial casinos, racetracks, and a maximum of seven sports arenas that seat more than 17,000 persons can all apply for master betting licenses with the Illinois Gaming Board.
At the moment of publication, ten or so operators hold permits for the provision of betting services. Some of the online sportsbooks Illinoisans can choose from include FanDuel, DraftKings, BetMGM, BetRivers, PointsBet, and Caesars. Unibet has also applied for a sportsbook license but is yet to receive authorization from the IGB.
The Fairmount Park and Hawthorne race tracks also have permission to operate sports wagering. No sports facilities hold licenses for the time being. Some of the approved suppliers of sports wagering software include Novomatic, NYX Digital Gaming, and SBTech Malta Limited.
Licensing Fees and Requirements
Companies interested in obtaining master sports betting licenses must start by submitting their documents for approval upon paying an application fee. Each approved candidate can operate no more than one online sportsbook skin in Illinois.
While the Prairie State is undoubtedly a lucrative market, the initial licensing fees are quite hefty, to say the least. Existing casinos and race courses must pay initial fees of $10 million or 5% of their annual gambling revenue and wagering handle, depending on whichever amount is lower.
The fees for newly authorized landbased operators are 5% of the AGR but no more than $5 million. Sports facilities looking to offer legal wagers are subject to $10 million initial licensing fees, while online-only permits cost $20 million. On a more positive note, licensees are not subject to integrity fees as is the case in some states like Indiana.
Licenses expire every four years and operators can renew them at a cost of $1 million. Additionally, online and landbased licensees pay taxes of 15% based on their gross betting revenue. The profits from bets made in Cook County and Chicago are subject to additional tax rates of 2%.
No In-Person Registration for Online Punters
Before March 5, 2022, Illinois punters who wanted to bet on sports via mobile apps or over the internet had to register their accounts in person at a landbased betting facility. The good news is locals no longer have to suffer this inconvenience thanks to the most recent changes in the Illinois sports wagering legislation.
The amendments also authorized limited betting on local collegiate events provided that punters place their wagers in person. Under the new rules, only betting on the outcomes or finals scores (tier 1 wagers) of local collegiate games is possible. The law prohibits wagering on the performance of individual collegiate athletes. Residents who have self-excluded from casino gambling are unable to place sports wagers for the duration of their exclusion.
Legal Status of Online Casino Gambling
As we warned earlier, legal online casino gambling is yet to arrive in the Prairie State. Locals have no access to online slots or table games like blackjack, roulette, and baccarat. The only available forms of online gaming in Illinois are sports betting and the state-sanctioned lotteries.
Daily fantasy sports are another legal alternative for Illinoisans who can enjoy them at first-rate websites like DraftKings and FanDuel. Betting on live horse racing events is also possible at locally authorized racebooks.
Given the limited range of options, it is unsurprising some Illinoisans choose to satiate their appetites for interactive gambling at offshore online casinos. Such players have no legal recourse in cases of refused or delayed payments, though. To our knowledge, the Illinois authorities neither block the access to such unauthorized sites, nor prosecute locals for using their services.
Illinois Gambling Regulator
Before we wrap things up, here are a few words about the local regulatory body, the Illinois Gaming Board (IGB). Created by the passage of the Illinois Gambling Act, the IGB takes on oversight and licensing responsibilities, regulating the operations of commercial casinos, racinos, and sportsbooks. It supervises them both in online and landbased form.
The IGB also carries out routine audits that aim to preserve the integrity of the local gaming industry. The Board consists of five members selected by the Illinois Governor with the approval of the Illinois Senate.
All key persons employed in the IGB are prohibited from gambling participation at local casinos. Only residents of the Prairie State can become board members of the IGB. Board members serve a three-year term and only three of them can have the same political party affiliation.
Conclusion
Illinois legislation ensures a properly regulated gambling environment for locals looking to have a flutter on lotteries, landbased casino games, poker, bingo, and sports events. Several legal online sportsbooks have already gone live in the Prairie State.
Residents also have the option to purchase tickets for the state-sanctioned lottery over the internet but online casino games remain illegal for the time being. Given how lucrative these activities could be from a tax perspective, perhaps state lawmakers would change their rigid stance and introduce legislation to regulate them in the future.