Zachary Mauer Senior Editor Loyola University Chicago School of Law, JD/MPP 2022
Illinois has historically been at the forefront of gambling regulations in the United States. Chicago, on the other hand, has resisted sanctioning formalized gambling locations until recently. Following the passage of the 2019 Gaming Expansion Law, Illinois expanded gambling across the state and Chicago is planning to open its first casino by 2025. Chicago is also concurrently debating an ordinance that would allow sports gambling within the city’s stadiums and arenas.
History of gambling in Illinois
The first type of gambling that was legal in Illinois was betting on horse races. The legalization of horse race betting in the 1920s helped kickstart an entire industry of tourism and revenue for the state. While the industry boomed throughout the 20th century, there are only two horse racing facilities left in Illinois after the recent closure of the Arlington International Racecourse in September. Illinois was also the first state to create a state lottery in 1974.
The Riverboat Gambling Act was enacted in Illinois in 1990, making it legal to operate casinos on riverboats. This made Illinois the second state in the US to legalize riverboat gambling. Originally, riverboat casinos were required to be continually moving along a waterway when gambling took place, but the law changed in 1999 to allow the riverboats to be permanently docked. Today there are ten riverboat casinos operating in Illinois including four riverboat casinos within the Chicagoland area.
Illinois expands gambling
In June 2019, Illinois Governor J.B. Pritzker signed the Gaming Expansion Law into law that considerably increased the ways that Illinoisans can gamble and the places where wagers can be placed. The law authorizes six new casinos to be built throughout the state, with one of them being built in Waukegan, one potentially located in one of six approved townships in Cook County, and one located within the City of Chicago. This would bring the total number of casinos in the state to 16.
The Gaming Expansion Law also provides a lifeline for those struggling horse racetracks. The act allows horse racetracks to operate slot machines and table games — earning them the aptly named title “Racinos.” Further, the Gaming Expansion Law creates Illinois’ first sports gambling regulations.
A casino is coming to Chicago
Besides the riverboat casinos just outside the city limits, Chicago does not have any formalized gambling locations within the city. In an effort to take advantage of an untapped revenue source, Chicago is forging ahead to build the first casino within the city limits by 2025. Once the casino is built, Chicago will become the largest city in the U.S. with a casino.
In November, city officials unveiled the five finalist proposals coming from three developers across five distinct sites across the city. The five casinos are being proposed for the Chicago Tribune printing site, the old Michael Reese site, near McCormick Place, at the One Central development near Soldier Field, and in “The 78” megadevelopment along the south branch of the Chicago River.
City officials claim that construction of a casino will create thousands of jobs and bring in millions in tax revenue to shore up the city’s underfunded police and fire pension obligations. The bidders will formally present their plans to the public on December 16. A majority of the City Council will have to approve the proposal before the winning bidder can receive a final operating license from the state’s gaming regulator. A vote is expected in early 2022. Once a winner is announced and approved, the winning bidder can establish a temporary casino in the city for up to two years, with a twelve-month extension as it builds out the larger casino.
Sports gambling in stadiums
An issue closely tied to the construction of a casino in Chicago is the future of sports gambling within the city’s sports stadiums. Chicago aldermen have been weighing an ordinance that would allow Wrigley Field, Guaranteed Rate Field, Soldier Field, Wintrust Arena, and the United Center to establish sportsbooks at or nearby their facilities. The biggest pushback to sports betting in stadiums has come from the developers of the casino proposals, in particular casino magnate and billionaire Neil Bluhm. Bluhm predicts that stadium sports gambling would have a “material negative impact” of about ten percent on the revenue of the Chicago casino and city tax revenues. In response, Deputy Mayor for Economic Development Samir Mayekar said Mayor Lori Lightfoot believes multiple sportsbooks and a casino can “coexist.”
“We’ve been paying very close attention to other municipalities where you have sports gaming establishments and casinos and we really haven’t seen a significant cannibalization,” Mayekar said.
On Tuesday December 8, Ald. Emma Mitts (34th Ward), the chair of the License Committee, abruptly recessed the committee hearing that was supposed to vote on the stadium sports gambling ordinance. Despite Mayor Lightfoot’s support, some aldermen were concerned that the two percent tax on gross revenues from sports betting is too little, as it is projected to raise only $400,000-$500,000 annually. “It seems like peanuts for an industry that is growing,” said Ald. Pat Dowell (3rd Ward).
Other aldermen were sympathetic to Bluhm’s argument. “There are too many unknowns,” said 7th Ward Ald. Greg Mitchell, “We are moving entirely too fast.”
Despite the potential revenue boon for the city, the social ills that come with gambling must not be ignored. Chicago’s gradual approach to legalizing gambling will give the city time to develop and support gambling addiction clinics. The tax income received from gambling should be used to fund those efforts, as well as utilized to address the violence that continues to plague the city. It remains to be seen whether Chicago seizes the opportunity to support its most vulnerable citizens with the millions of anticipated revenues from gambling.