Illinois gambling expansion signed into law

Illinois governor J.B. Pritzker on Friday signed into law Senate Bill 690 which, among other things, permits the state’s racetracks to operate casinos and conduct sports betting, at least throwing a lifeline to a racing jurisdiction that has been on the verge of going under.

The massive gambling expansion legislation, passed early this month on successive days by the Illinois House and Senate, has at its centerpiece a long-awaited casino in the city of Chicago, along with five other new casinos dotting the state and adding to the 10 already operational. Sports betting also will proliferate in the state once the Illinois Gaming Board begins issuing licenses, and for the Illinois racing industry a day many believed would never come finally did following more than a decade of waiting.

The bill would permit Arlington and Hawthorne to install up to 1,200 slot machines and offer table games like blackjack and poker. Fairmount Park in downstate Illinois could have up to 900 slot machines. Tracks also can conduct sports betting, but revenue derived from that avenue would go merely to track owners, not race purses.

The new law puts an end to an Illinois practice known as recapture that has allowed tracks to deduct a considerable percentage of handle that would otherwise go to purses, a unique circumstance nationally that came into being when track operators here resisted a law change that permitted full-card simulcasting. Hawthorne and Arlington took about $7.2 million in recapture funds out of Thoroughbred purse accounts in 2018. Recapture would end the year after racetrack casinos began operating.

The legislation also calls for a new harness track and accompanying casino to be built in Chicago’s south suburbs. Illinois, once a national harness racing hub, has seen Balmoral Park and Maywood Park close in recent years and now has only fair racing and a summer meeting at Hawthorne.

The Illinois Thoroughbred Horsemen’s Association estimates that if the new track is built and both Hawthorne and Arlington maximize their casino opportunities, purses at Chicago-area tracks could roughly double, rising to $40 million or $50 million.

“It will take some time before Illinois Thoroughbred purses are substantially improved. But when the terms of this new law are fully implemented, Illinois can once again become a world-class destination for Thoroughbred horse racing,” ITHA president Mike Campbell said in a message to his membership Friday.

Arlington, Fairmount, and Hawthorne all have expressed an interest in conducting sports betting, but Arlington, owned by Churchill Downs Inc., has been quiet regarding how it will respond to the casino-enabling legislation. CDI is a majority stakeholder in Rivers Casino, the state’s largest pending the Chicago casino, which sits about 13 miles from Arlington. Fairmount and Hawthorne have expressed intent to convert their tracks into racinos as soon as possible, though sports betting can be more quickly implemented. Tim Carey, president of Hawthorne, said earlier this month he hoped the track could have at least a rudimentary casino running by the summer of 2020.