How long will it be until Illinois can fully realize the revenue implications of legalized sports betting and other gambling expansion? We’ll set the line at 42 months, and I’ll take the over.
Gov. JB Pritzker on Tuesday signed Senate Bill 516, which lowered the tax and fee rates for the Chicago casino first approved in 2019. The betting industry said the initial rates were too high to make running the casino feasible, which made retooling the plan necessary to turn on the revenue stream for things such as hospitals and higher education capital projects.
The timing, of course, is horrible. In February, Chicago Mayor Lori Lightfoot pegged the annual government take from Chicago’s unbuilt casino at $1.2 billion. But getting such a facility built and fully operational in the midst of a national health and economic crisis seems equal parts impractical and implausible.
The pandemic also temporarily tanked sports betting in Illinois. It was mid-May 2018 when the U.S. Supreme Court cleared the way for states to authorize sports wagering, but Illinois stumbled while other states sprinted. It took until March 9 of this year for the first legal sports bets to take place here, days ahead of the annual NCAA basketball tournament, one of the biggest betting events of the year. Yet before that week ended, all the major sports leagues had shut down indefinitely and March Madness was mothballed.
Although the pro baseball, basketball and hockey leagues have plans to return in some fashion, which will partially revive the market, teams likely won’t be playing with fans in attendance, sidelining plans for on-site betting that could have helped local tax coffers while also giving club owners additional revenue streams.
The NBA and MLB won’t resume regular-season contests for a few weeks, but players and staff members already are showing up positive for COVID-19, while some are choosing to stay home rather than risk contracting the virus. Neither sport attracts gamblers on the level of pro and college football, and given the way virus data is trending – plus what we’re all hearing about plans for having students on campus in only a few weeks – it’s not looking real great for full seasons this fall. That will further suppress the sports book market.
S.B. 516 also allows the Illinois Department of Agriculture to operate video wagering machines at the two state fairs – both already canceled for 2020 – so just add that to the list of revenue projections that need to be wholly recalculated.
Although the underlying logic behind gambling expansion remains sound, we’re a long way from meeting pre-pandemic revenue projections, which necessarily dulls enthusiasm for projects it was supposed to fund.
The house always wins, but only when it can take action.
• Scott T. Holland writes about state government issues for Shaw Media Illinois. Follow him on Twitter at @sth749. He can be reached at firstname.lastname@example.org.