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Illinois Sports Wagering Act

The Illinois Sports Wagering Act has introduced a legal framework for sports betting in Illinois. On this page, we provide clarity and insight into the Act's provisions and implications.

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What is the Illinois Sports Wagering Act?

The Illinois Sports Wagering Act is a comprehensive legal framework that governs and regulates Illinois sports betting. Enacted as part of a larger capital bill in 2019, this Act legalizes sports wagering at licensed venues, including casinos, racetracks, and sports facilities, as well as through online platforms.

When was the Illinois Wagering Act signed into law?

Signed into law by Governor J.B. Pritzker on June 28, 2019, the Illinois Sports Wagering Act led to the placement of the state's first legal sports bet on March 9, 2020. This historic event signaled the official legalization of sports betting in Illinois, setting the stage for the implementation of the Act's provisions.

The signing of the Act into law was the culmination of extensive legislative efforts and marked the beginning of a new era in Illinois' gaming and sports betting industry.

Summary of the Illinois Sports Wagering Act

This summary provides a concise overview of the Illinois Sports Wagering Act's key components, including its purpose, regulatory framework, and the various measures implemented to ensure ethical, responsible, and fair sports wagering practices within the state.

Legislative purpose

The Illinois Sports Wagering Act was established to legalize and regulate sports betting within Illinois, marking a significant shift from an unregulated to a regulated betting environment. This legislation responds to the growing popularity of sports betting across the nation and aims to harness its potential as a valuable revenue source. Central to the Act's purpose is ensuring the integrity and fairness of sports betting activities. It seeks to safeguard the ethical conduct of sports wagering, preventing manipulation and unethical practices. Additionally, the Act places a strong emphasis on promoting responsible gambling, incorporating measures to prevent problem gambling and protect consumers.

To oversee these objectives, the Illinois Gaming Board is tasked with the regulation and enforcement of the Act. The Board's responsibilities include managing the licensing process, monitoring sports wagering operations, and ensuring compliance with the Act's provisions. Through the Board's oversight, the Act aims to maintain a sports betting industry that operates transparently, ethically, and responsibly, aligning with the broader goals of consumer protection and integrity in sports and betting activities.

Key definitions

The Illinois Sports Wagering Act includes several key definitions essential for understanding and implementing the legislation. "Adjusted Gross Sports Wagering Receipts" refer to the total revenue from sports wagering after deducting the winnings paid out to bettors. The term "Athlete" encompasses both current and former professional and collegiate athletes. The "Board" mentioned in the Act is the Illinois Gaming Board, which is responsible for regulating sports wagering in the state. "Covered Persons" is a broad category that includes athletes, referees, team personnel, and others closely associated with sports contests.

The Act also defines "Official League Data" as the statistics and information used to determine outcomes for certain types of sports wagers, specifically obtained under agreement with sports governing bodies. The Act distinguishes between "Tier 1" and "Tier 2" sports wagers; Tier 1 wagers are based solely on the final score or outcome of a sports event and placed before the event begins, while Tier 2 wagers include all other types of sports bets. These definitions are crucial for the effective regulation and understanding of sports wagering under the Act, ensuring clarity and consistency in its application and enforcement.

Licensing requirements

Under the Illinois Sports Wagering Act, strict licensing requirements are set to regulate who can legally offer sports betting. Entities seeking to provide sports wagering must obtain the appropriate license from the Illinois Gaming Board. The Act outlines several types of licenses, including the master sports wagering license for organizations like land-based casinos, horse racing tracks, sports facilities, and online sports wagering operators. Additionally, there are occupational licenses for individuals working in sports wagering operations, supplier licenses for those selling or leasing sports wagering equipment, and management services provider licenses for entities managing sports wagering services.

Applicants must undergo a thorough application process, which includes background checks and the submission of detailed operational plans. The process is designed to ensure that only those entities and individuals who meet the high standards of integrity and responsibility required by the Board are granted licenses. The licensing fees and structures vary depending on the type of license, and there are provisions for license renewal. These stringent licensing requirements are a cornerstone of the Act, ensuring that sports wagering in Illinois is conducted in a legal, ethical, and regulated environment.

Sports wagering authorization

The Act authorizes and sets the framework for legal sports betting within the state, under specific conditions. It permits licensed entities, such as casinos, racetracks, and sports facilities, to conduct sports wagering. Additionally, the Act allows for online and mobile betting platforms, expanding the accessibility of sports betting to a broader audience.

However, there are restrictions in place: betting on minor league sports events and, with certain exceptions, collegiate sports events involving Illinois teams, are prohibited. This is to ensure the integrity of amateur sports and protect young athletes. The Act mandates that individuals placing bets must be at least 21 years old, aligning with the legal age for gambling. Furthermore, it specifies that bettors must be physically located within the state of Illinois to place a wager. This geographical restriction is crucial for regulatory and legal compliance.

Online and mobile betting

The Illinois Sports Wagering Act includes provisions for online and mobile betting, significantly expanding the accessibility and convenience of sports wagering in the state. This aspect of the Act allows bettors to place wagers on sports events through internet-based platforms, including websites and mobile applications.

To participate in online or mobile betting, users must first register and create an account with a licensed sports wagering operator. Initially, there was a requirement for in-person registration at a physical facility, but this has been evolving to accommodate more flexible online registration processes.

Taxation and revenue allocation

The Illinois Sports Wagering Act establishes a taxation structure for the revenue generated from sports betting. A key component of this structure is the imposition of a 15% tax on the adjusted gross sports wagering receipts, which are the total earnings from sports wagering after deducting the winnings paid out to bettors. This tax rate is applied to all licensed sports wagering operations within the state, creating a significant revenue stream for Illinois.

The revenue collected from this tax is allocated to specific funds as outlined in the Act. The majority of the tax revenue is deposited into the Sports Wagering Fund, a special fund created under the Act. From there, the money is used for various state programs and initiatives. A notable aspect of the revenue allocation is the transfer of excess funds from the Sports Wagering Fund to the Capital Projects Fund, which supports public infrastructure projects and other capital expenditures in Illinois.

Additionally, the Act includes a provision for an extra 2% tax on the adjusted gross receipts from sports wagers placed within counties with populations over 3 million. This additional tax is intended to support criminal justice-related initiatives in those counties. Overall, the taxation and revenue allocation measures in the Illinois Sports Wagering Act are designed to ensure that the state and its counties benefit financially from the legalization of sports betting.

Responsible gambling

The Illinois Sports Wagering Act places a strong emphasis on responsible gambling, incorporating several measures to address and prevent problem gambling. Recognizing the potential risks associated with betting, the Act mandates that all licensed sports wagering operators include information about obtaining assistance with gambling problems. This is typically achieved through visible messages or links on their platforms, directing users to resources and support services for responsible gambling.

Furthermore, the Act introduces a voluntary self-exclusion program in Illinois. This program allows individuals to willingly prohibit themselves from engaging in sports wagering. It is designed to provide a tool for those who feel they are at risk of developing a gambling problem, offering them a way to control or limit their betting activities.

Prohibited conduct and enforcement

The Illinois Sports Wagering Act addresses prohibited conduct in sports betting and outlines strict enforcement measures to uphold the integrity of sports wagering. Prohibited conduct includes any actions or communications intended to influence the outcome of a sporting contest or individual performance for financial gain or to avoid financial or physical harm. This encompasses a range of unethical behaviors such as match-fixing, manipulation of betting outcomes, and providing inside information.

To enforce these regulations, the Illinois Gaming Board plays a crucial role. The Board is tasked with investigating allegations of prohibited conduct. It establishes a confidential hotline or communication method for reporting any suspicious activities related to sports wagering. Upon receiving credible allegations, the Board refers these cases to the appropriate law enforcement entities for further action.

Use of official league data

The Illinois Sports Wagering Act includes specific provisions regarding the use of official league data in sports betting. Official league data refers to the real-time statistics, results, and other data related to sports events, which are obtained from sports governing bodies or their authorized representatives. This data is crucial for determining the outcomes of certain types of sports wagers, particularly those known as "Tier 2" wagers, which are not solely based on the final score or outcome of a sports event.

The Act mandates that for certain types of bets, sports wagering operators must use official league data provided by authorized bodies. This requirement ensures the accuracy and consistency of the data used in sports betting, thereby maintaining the integrity of the betting process and the fairness of the outcomes. It also recognizes the proprietary value of the data generated by sports leagues and the importance of using official sources to safeguard against manipulation or misuse of information.

Supplier diversity goals

The Act places a significant emphasis on supplier diversity in the sports wagering industry. It mandates that all licensees under the Act must actively pursue and report on their goals and actual spending with businesses owned by minorities, women, veterans, and persons with disabilities, as well as small business enterprises. This requirement is part of a broader effort to ensure inclusivity and equal opportunity in the economic activities generated by sports wagering.

Each year, licensees are required to submit a detailed report outlining their procurement goals and the extent to which they have engaged diverse suppliers. These reports must include plans for increasing participation from diverse businesses, challenges faced in finding quality vendors, and strategies for overcoming these challenges. The Act also encourages licensees to share success stories and best practices to promote wider adoption of supplier diversity.

Compliance with the Illinois Gambling Act

The Illinois Sports Wagering Act ensures compliance with the broader Illinois Gambling Act. This compliance is crucial for maintaining a consistent and unified approach to gambling regulation in the state. Where the Sports Wagering Act is silent or lacks specific provisions, the rules and regulations established under the Illinois Gambling Act automatically come into play.

This means that the standards, procedures, and regulatory measures outlined in the Illinois Gambling Act apply to sports wagering activities, ensuring that there is no regulatory vacuum.