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Illinois Lottery handling bets

Sep 25, 2019 3:00 AM

The gambling bill Illinois Governor J.B. Pritzker signed into law in June checks in at a whopping 816 pages, a fitting size given the hopes and ambitions that include an estimated $650 million in revenue when including licensing fees collected for sports books who wish to do business in the Land of Lincoln.

Tucked within that bill and covering only six pages, is a pilot program for the Illinois Lottery to offer sports parlay betting at retail spaces — think your neighborhood corner store or gas station — at up to 5,000 locations across the state.

Though smaller in size and scope than sports betting as a whole, it has the chance to be the first legalized form of sports betting offered in Illinois as negotiations among casinos, state government, and sports books plod along.

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Illinois Lottery general counsel Cornell Wilson called sports parlay betting “a great opportunity for the lottery to grow and facilitate the state’s revenue” during a meeting of the agency’s control board in August.

Sports parlay betting via state lottery is not a new concept, but an underused one — only Delaware currently offers it. That state’s program, which began in 2012, requires a $2 minimum bet and at least three correct picks for the bettor to win from professional and collegiate games. It also operates on a small scale and has just over 100 retail locations.

According to the Delaware state lottery office, the program created $6 million in revenue in 2018, but the number for this year is in a state of flux — the state also has legalized sports betting now available. Also, sports bettors in neighboring New Jersey and the Philadelphia area have legalized sports gambling and no longer need to make the trip across state lines to wager.

The initial plan for Illinois is to have electronic kiosks at 2,500 authorized retailers across the state in the first year. If things go according to plan, they would match that total in the second year and give the state sports betting offerings at approximately two-thirds of the 7,400 locations lottery tickets are already offered.

There are two challenges the Illinois Lottery must overcome for this to be successful, though. One is the fixed length of the program — the clock is already running, rules must be written by state officials to bring the program into existence, and the expiration date is Jan. 1, 2024.

The other is finding someone willing to take on the one-time $20 million license fee — a substantially higher amount than the usual five and six-figure amounts for such a program.

That fee raises the question whether anyone could turn a profit on such a short time span and also appears to limit the potential suitors for the Illinois Lottery to large corporate outfits.

But with a glacial pace for sports betting becoming more entrenched in Illinois with each passing month and neighboring states Iowa and Indiana offering full sports betting services that take potential revenue out of Illinois, it is possible a state lottery system could offer a short-term salve and provide impetus to get sports betting operational on a large-scale basis quicker. 

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