With controversial 2% tax

Chicago City Council lifts ban on sports betting, paves the way for in-stadium sportsbooks

Soldier Field stadium in Chicago.
2021-12-16
Reading time 2:10 min

The Chicago City Council agreed Wednesday to lift the Chicago ban on sports betting and impose a Mayor-backed 2% tax on gross revenues from it, which allows sportsbooks to open in and around Soldier Field, Wrigley Field, Guaranteed Rate Field, the United Center and Wintrust Arena.

The 2% city tax on gross revenues from sports betting is expected to generate $400,000 to $500,000 a year based on an estimated $25 million in annual revenues from sports betting in Chicago.

Lightfoot added the 2% tax on the sports betting to try to address criticism that the stadium venues would eat into the taxes from the planned casino. That money is earmarked to help fund Chicago’s public pensions. Several aldermen noted then that the sportsbook taxes would pale in comparison to the many millions of dollars in taxes casino backers have said would be lost if the team owners are allowed to “cannibalize” the casino with their own establishments.

The ordinance allows sports gambling facilities within Wrigley Field, Guaranteed Rate Field, Soldier Field, the United Center and Wintrust Arena, or at sites within five blocks of those stadiums. Two off-track betting businesses licensed in Illinois could also opt to set up sportsbooks in Chicago, and one would be allowed in the casino, when it’s built.

The decision came with nine dissenting votes. Three mayoral allies — Budget Committee Chairwoman Pat Dowell, Ald. Greg Mitchell and Energy and Environmental Protection Committee Chair George Cardenas, Mayor Lori Lightfoot’s deputy floor leader — have denounced the city’s take as “peanuts for an industry that is growing” and “not a sufficient reward for the risks we’re taking.”

No more than 15 kiosks or wagering windows would be allowed at each location unless bettors can also buy food and drink. No one under age 21 would be allowed to place a bet. Sports wagering would be prohibited from midnight to 10 a.m. Monday through Thursday; midnight Friday to 9 a.m. Saturday; and 1 to 9 a.m. on Saturday and Sunday.

The city would issue two types of sports wagering licenses: “primary” and “secondary.” Primary sports licenses would start at $50,000 a year and cost $25,000 for annual renewal. Secondary sports licenses would start at $10,000, with an annual renewal fee of $5,000.

Billionaire casino magnate Neil Bluhm, who owns Rivers Casino in Des Plaines and is among the bidders for a Chicago casino, has been lobbying against the ban lift and warned that allowing sports betting in Chicago would mean the city’s casino would lose significant business, costing the city $11 million to $12 million in annual tax revenue, far more than the $400,000 to $500,000 in tax revenue that would be created by the city’s proposed 2% tax on sports books.

“I can assure you as an experienced casino and sportsbook operator, that this ordinance will cost the city of Chicago serious money,” Bluhm told aldermen during a committee meeting on Monday, claiming the ordinance would essentially create five “mini-casinos” that would take away visitors and money from a Chicago casino.

However, Mayor Lori Lightfoot and her top aides have disputed Bluhm’s claims, pointing to a study by Las Vegas-based Union Gaming, which found allowing sports betting in Chicago would not have a significant impact on casino revenue.

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