State Sen. Cristina Castro and Rep. Edgar Gonzalez have introduced Senate Bill 1963 and House Bill 3080, which would create the Internet Gaming Act and allow the Illinois Gaming Control Board to regulate the industry.
Under the proposals, casinos and horse racing tracks in Illinois would be permitted to operate up to three individually branded online gaming platforms, or “skins,” with an initial license fee of $250,000.
Online casinos would be taxed at 25% of adjusted gross revenue, with estimates suggesting the state could collect up to $800 million annually from the new industry.
For Castro, this is not a new battle. She previously introduced similar legislation in 2021 and 2023, both of which failed to progress through the legislature. However, the growing financial strain on Illinois could make this latest effort more appealing to lawmakers.
“In a tough budget year, you’re looking at ways to increase revenue,” Castro said. “This is one tool for that. And it’s something that could be more palatable to constituents.”
Challenges and Key Provisions
Despite the potential financial windfall, the bill faces opposition from various stakeholders, particularly proponents of Illinois’ massive video gaming terminal (VGT) industry. With nearly 8,700 licensees and more than 48,700 terminals statewide, VGTs are the largest source of gambling tax revenue in Illinois, generating $884.2 million in state receipts in 2024.
In comparison, the 16 Illinois casinos brought in $345.2 million in tax revenue, while sports betting contributed $244.2 million through November.
To address concerns about job losses at retail casinos, the proposal includes a workforce protection clause. Licenses will not be issued or renewed for organizations that have reduced their workforce by 25% or more since February 28, 2020.
This provision aims to mitigate fears of online gambling cannibalizing brick-and-mortar casino jobs. However, the bill does not define what constitutes a “workforce,” leaving room for debate among its opponents.
Additionally, the legislation emphasizes diversity and inclusion efforts. Licensed online gaming operators would be required to file annual reports detailing their spending with businesses owned by women, minorities, veterans, and people with disabilities.
They would also need to outline their future diversity goals and hold public workshops to promote supplier diversity.
Governor Pritzker’s Stance and the Road Ahead
Governor JB Pritzker, who has overseen significant gambling expansion in Illinois, including sports betting and new casino openings, has signaled openness to Illinois online casino legalization.
“It’s worthy of consideration,”
Pritzker said last month when discussing ways to address the state’s budget shortfall.
The bills have been referred to the Senate and House committees, marking the start of what could be a long legislative process. Illinois operates on a two-year legislative cycle, and previous attempts at passing online casino legislation stalled in committee.
Still, with neighboring states like Indiana and New York also considering similar measures, the pressure to modernize Illinois’ gambling landscape is mounting.
While the fate of online casinos in Illinois remains uncertain, the financial and political climate suggests this effort has more momentum than in previous years. Whether it gains enough traction to pass will depend on how lawmakers balance economic benefits with industry opposition.
