Illinois lottery bill eyes regulation of courier sales as Texas court blocks crackdown

A proposed bill in the Illinois Senate would authorize the state’s lottery to regulate third-party courier services, potentially expanding access to retail lottery tickets through online orders, even as Texas moves in the opposite direction with a court battle over similar services.

Senate Bill 2035, introduced by Sen. Celina Villanueva in February, would amend Illinois law to allow licensed lottery retailers to contract with third-party entities to facilitate ticket sales. These couriers operate by accepting online orders, purchasing tickets at physical locations, and delivering digital copies to customers while retaining the originals.

The bill outlines strict requirements for participating couriers, including prohibitions on terminal commingling, out-of-state ticket sales, and the sharing of user data with unaffiliated entities. Agreements between sales agents and couriers must be submitted to the Lottery Control Board within five business days of execution.

“[The bill] allows a licensed lottery sales agent to enter into an agreement with a third-party entity to assist with processing the sale of lottery tickets on behalf of the licensed lottery sales agent,” the legislation states. It also mandates that “the licensed sales agent to provide a copy of agreement to the Lottery Control Board within 5 business days.”

Violations of the law could result in criminal penalties ranging from a Class B misdemeanor to a Class 4 felony. As of April 11, SB2035 remains under review by the Assignments Committee.

The measure comes as Illinois continues to report record-setting lottery revenues. Online lottery sales reached $686 million in fiscal year 2024, contributing to a total of $3.86 billion in sales and $883.6 million in proceeds to the state. If passed, the bill could bolster overall sales by allowing courier services to operate within the retail space, though their impact may be less pronounced than in states without an existing online lottery platform.

Meanwhile, Texas is facing legal headwinds in its attempt to restrict courier services. A state judge issued a temporary restraining order late last week blocking the Texas Lottery Commission from enforcing a new rule that would have barred lottery retailers from working with couriers. The rule had threatened to shut down LTC Texas, a company affiliated with New Jersey-based Lotto.com.

State District Judge Sherine Thomas ruled that LTC Texas “is likely to win its case” and barred the commission from taking enforcement actions, including seizing terminals. A hearing on the matter is scheduled for May 27.

The Texas legislature has pushed back aggressively against courier services. Lt. Gov. Dan Patrick and other lawmakers argue the services bypass a 1991 law prohibiting the use of telephones to buy lottery tickets. Sen. Bob Hall (R-Edgewood) has gone further, introducing a bill to eliminate the state lottery entirely.

“It will be crystal clear to everyone listening that the Lottery Commission has failed to uphold any of the principles of honesty and integrity,” Hall said during a recent committee hearing. “It is a well known fact that gambling, and the lottery is gambling, always attracts a culture of corruption.”

Courier activity drew heightened scrutiny in April 2023 when a group allegedly used couriers to purchase nearly all of the 25.8 million number combinations in a Lotto Texas draw, winning a $95 million jackpot.

Until early 2025, Texas lottery officials maintained they could not regulate courier firms. But the commission reversed course under legislative pressure, prompting the legal action from LTC Texas. The commission’s executive director, Ryan Mindell, who supported the regulatory pivot, resigned last month without public explanation.

Despite the controversy, the Texas Lottery remains a financial powerhouse, generating $8 billion in annual sales and approximately $2 billion in profit for the state.