Illinois Online Sports Betting Remote Sign-Up Push Earns Frosty Reception
Daniel Acker for The Washington Post via Getty Images. Pictured: Illinois State Capitol building.
It seems increasingly likely Illinois sports bettors will have to register for sportsbooks in-person throughout the rest of the year after lawmakers responded coldly to remote sign-up pitches during a legislative hearing Wednesday.
Multiple lawmakers dismissed industry stakeholders’ appeals to remove the registration requirement that mandates Illinois sports bettors complete sign-up at a digital sportsbooks’ brick-and-mortar partners. Gaming industry stakeholders argued during a virtual hearing Wednesday that the requirement has a negligible benefit to retail gaming entities and instead pushes would-be legal players back to the black market.
Illinois and Nevada are the only states with such in-person registration mandates for online sportsbooks. As gaming industry officials noted Thursday, Nevada’s plethora of casino options creates a minimal hurdle; in Illinois, the in-person sign-up effectively eliminates access to multiple sports betting options in what is already a small array of legal options.
For example, a Chicagoland-area resident may only have to travel a few miles to register for a PointsBet affiliate in the area, but would have to drive roughly four hours to sign up for DraftKings’ partner facility in East St. Louis. For many bettors, any sign-up beyond downloading an app eliminates market participation.
“There is no need to have the people in Illinois have to drive in order to complete their registration,” said Trevor Hayes, William Hill’s Head of Government Relations, during Wednesday’s House committee hearing while supporting mobile registration.
“It has been a success and I think it is time to open it up,” Hayes said.
Politicians Stick With In-Person Registration
After months of often tense negotiations, lawmakers approved a sweeping 2019 gaming bill that, among other gambling expansions, allowed retail and online sports betting. At the time already one of the nation’s most expansive gaming markets, Illinois officials tried to balance competing video gaming terminals, horse racing, casinos and other gaming interests.
The in-person registration was one such compromise. Fearing online gaming would reduce foot traffic, the casinos pushed, and ultimately earned, an in-person registration requirement.
That original legislative intent, lawmakers said Wednesday, should remain.
“That was a really important part of what the final outcome of the bill was,” said Rep. Bob Rita, who chaired Wednesday’s gaming meeting.
Chicago’s first retail sports bet came in March 2020, days before the COVID-19 pandemic shuttered retail casinos. The first online bet wouldn’t come until May and, with casinos still closed, Gov. J.B. Pritzker issued an executive order that month permitting remote registration.
Bolstered by remote sign-up, six online sportsbooks have launched since May 2020; BetRivers, DraftKings, FanDuel, William Hill, PointsBet and Barstool Sportsbook. Pritzker renewed the order for several additional months, spurring hopes remote registration would, in effect, remain permanent until the original physical sign-up period sunset in 2022.
Instead, Pritzker surprisingly allowed the exception to expire earlier this month. There’s little indication Pritzker will reinstate the order, leading legislative action the only plausible path to remote sign-ups.
Wednesday’s hearing revealed lawmakers have seemingly little political inclination toward doing so.
“As we come out of a pandemic, we still need to continue to look at our brick-and-mortars, who are employing people and paying taxes,” Rita said Wednesday.
In the meantime, It appears other leading brands such as BetMGM that have already earned regulatory approval may delay implementation until the clause sunsets next year. In neighboring Iowa, BetMGM launched Jan. 1, 2021, the day the state’s in-person registration requirement expired.
Stakeholders Seek College Betting Ban Repeal
Many of the same mobile registration advocates also asked lawmakers to repeal the in-state college betting ban. Illinois bettors can’t wager on in-state programs such as the University of Illinois or Loyola Chicago, a prohibition that has drawn stakeholder backlash, notably during the two school’s NCAA Tournament matchup last month.
University of Illinois Athletic Director Josh Whitman said Wednesday that he and the state’s other Division I programs oppose a repeal bill sponsored by Rep. Mike Zalewski. Whitman, a former Illinois football player, said the legislation intensifies the already extensive pressure on student-athletes, and gambling leaves them subject to further vitriol from not only disgruntled fans, but angry sports bettors.
Zaleski countered the probation does little to protect athletes, and that a regulated, legal market actually helps detect illicit gambling issues or impacts on college competitions.
John Pappas, representing online gaming industry advocacy group iDEA Growth, said the in-state college betting ban costs Illinois up to 15 percent of its potential betting handle.
“Given the popularity and passion in the state for hometown teams, the current law is curtailing growth without any corresponding benefit to the player or game integrity,” Pappas testified Wednesday.
“We believe the most efficient way to avoid the negative impacts is for the legislature to legalize and regulate bets on these college games so there’s full transparency and that the regulated market can ensure that players and games are protected,” Pappas said.
Other Gaming Issues
In another part of Wednesday’s lengthy gaming hearing, representatives from the WNBA’s Chicago Sky and American Hockey League’s Chicago Wolves asked for rights to open in-stadium sportsbooks at their respective playing venues. Larger professional sports venues for teams such as MLB’s Chicago Cubs, which announced plans to open a sportsbook at Wrigley Field, were permitted to open sportsbooks under the 2019 bill. Other host stadiums for the NFL’s Chicago Bears as well as the NBA’s Chicago Bulls and NHL’s Chicago Blackhawks, were permitted the rights to sportsbook licenses under the 2019 sports betting law.
Additionally, advocates for the smaller sports organizations asked lawmakers to reduce the $10 million licensing fee. The fee, which only encompasses retail sports betting rights at the stadium itself, is the same charged to online operators, which can take online bets statewide.
The hearing further addressed elected officials’ other lingering concerns from the sweeping 2019 sports betting bill, and also touched future horse racing, video gaming terminal, online poker and iCasino gaming and lottery policies, among a host of other issues.
Lawmakers took no votes or other actions on any legislation or proposal Wednesday. Any gaming bill faces a steep political and logistical climb in this year’s initial legislative session, which is set to conclude next month.