After successfully voting a gaming expansion bill, Illinois now expects to beat Nevada in terms of total gaming and sports betting handle as confirmed by analysts.
Illinois $45-billion Plan, Gaming Expansion and Sports Betting
Earlier this year, Illinois Gov. J.B. Pritzker signed a landmark $45-billion capital plan designed to rebuild communities across the state. The six-year plan accounts for a fair chunk of revenue streaming in from the casino gaming sector.
Moving forward, Illinois will expand with six new land-based casinos, including one project in Chicago, which alone will generate 4,000 permanent jobs. In terms of potential, the casino industry is expected to bring in $2 billion in one-off licensing fees and then continue to generate $400 million per year in tax payments.
Illinois to Beat Nevada in Total Sports Handle in 2023
According to Global Market Advisors, Illinois could be potentially generating a higher total sports betting handle than Nevada. Early estimates put the figure at $5.2 billion in 2023, potentially pulling ahead of the Silver State that year.
Another study by the Camelot Lottery Solutions outlines that there are 450,000 Illinois residents who are prepared to start betting on legal sportsbooks options within the state, ditching offshore operators and the travel to neighboring states.
The Camelot Lottery also estimates there are already around 27,000 illegal gamblers, generating about $4 million in total handle. While Chicago’s home sports teams have been struggling, consulting firm FDJ Gaming Solutions expects casual sports fans to become more open to the idea of placing a wager.
Admittedly, Illinois major league teams have been facing some organizational difficulties, but even then, Global Market Advisors projects a minimum total handle worth at least $2.8 billion in 2023.
Should the minimum figure be reached, Illinois will still become the sixth-largest state in terms of sports betting potential, after states such as Nevada, California, New York, and even Texas.
How Has Sports Betting Helped Early Adopters?
Given their size, Iowa and Indiana, both neighbors to Illinois, did well. A total of $94 million was put down in wagers in Iowa during the first month of sports betting in August. In turn, this generated $862,000 in tax revenue for the state.
Indiana, on the other hand, claimed a pretty tax penny worth $1.1 million out of a $92 million total handle. The biggest revenue is expected to come in 2021 when both Indiana and Iowa will get a chance to benefit from major events, such as The Super Bowl and March Madness.
Illinois is also trying to catch up and launch on time for these events, but this may still be too optimistic of a timeline. The Illinois Gaming Control Board will be releasing the applications for a sports betting license by mid-December.
The Chicago Casino and Revenue for the State
The proposed Chicago casino is the flagship project dwarfing other casinos in terms of permanent jobs, including Rockford (1,500), Walker’s Bluff (2,000) and Danville (1,000). Big hopes are pinned on sports betting, expected to generate between $58 million and $102 million annually.
The tax revenue will be divvied up between infrastructure projects as well as affordable housing, hospitals, and universities. Meanwhile, the signed gambling law is even more ambitious, offering to expand video gaming terminals at venues such as race tracks, although this is paired to an increase in the overall VGT tax.
However, gaming expansion should generate a total of $350 million every year, helping to prop up a capital debt service. As to the licensing fees, they will be used for pay-go capital costs.
Gov. Pritzker has been hailed for his decision to support what is one of the largest bi-partisan efforts in rebuilding Illinois.
Nevertheless, the success of a Chicago casino is still questioned. Lawmakers want to slap the would-be project with potentially overwhelming tax rates, which would make it not feasible.
Debates are still ongoing with a downtown destination for the mega project still remaining a possibility, while local lawmakers will be discussing fee and tax reduction during the new session.