After five weeks on the job, Governor J. B. Pritzker has made it clear – bring legal sports betting to Illinois this year.
Pritzker released his FY 2020 budget on Wednesday, which accounts for over $200 million from sports betting. This number was estimated by the cost of licensing fees, renewal fees, and the 20% tax on sportsbooks’ revenue.
Pritzker set out his plans for the industry in the budget proposal, which include:
- Mobile wagering and land-based sportsbooks
- Up to 20 licenses available at a cost of $10 million each
- An annual interactive license renewal fee of $5,000
- The State Gaming Fund receiving the 20% tax revenue
Oxford Economics estimated that Illinois could generate between $384 and $680 million in sports betting revenue per year. A 20% tax rate would bring in anywhere from $75 to $140 million a year.
Many legislators are on board with implementing Pritzker’s plan; however, others suggest the numbers will be skewed.
“Both parties have been guilty of overestimating new revenues,” Senator Sue Rezin (R-Morris) said.
The “overestimation” of $217 million in the state budget would receive the majority of the contributions from the $10 million licensing fees and 20% revenue. The 20% revenue is the second highest tax rate in the country behind Pennsylvania, who also have the same cost for a license.
Representative Mike Zalewski (D-Riverside) explained that the license structure and tax rate will be discussed before a final bill is voted on.
“I think the tax rate specifically is very much pliable,” Zalewski said. “I think there are areas where the governor is looking for legislative guidance.”
Senate legislators are also considering a bill that former NFL player and Senator Napoleon Harris III (D-Harvey) introduced. His proposal, Senate Bill 0176,was assigned to the Executive Committee last week.
“I am calling on the legislature to take this up immediately,” Pritzker said. “Every day we argue about ‘who’s in and who’s out’ is money that goes to other states and to the black market.”
Pritzker will likely get his wish for sports betting in Illinois, as the Democratic Governor has the backing in both the House and Senate. The Democrats control nearly two-thirds of the seats in the legislature.