101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3686

 

Introduced 2/14/2020, by Sen. Scott M. Bennett

 

SYNOPSIS AS INTRODUCED:
 
230 ILCS 10/7  from Ch. 120, par. 2407

    Amends the Illinois Gambling Act. Provides that if the Gaming Board does not issue all licenses within the time period specified under current law, then the Gaming Board shall reopen the license application process for those authorized licenses that have not been issued. Extends the relevant time frames for reopened license applications. Effective immediately.


LRB101 20639 SMS 70289 b

 

 

A BILL FOR

 

SB3686LRB101 20639 SMS 70289 b

1    AN ACT concerning gaming.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Gambling Act is amended by changing
5Section 7 as follows:
 
6    (230 ILCS 10/7)  (from Ch. 120, par. 2407)
7    Sec. 7. Owners licenses.
8    (a) The Board shall issue owners licenses to persons or
9entities that apply for such licenses upon payment to the Board
10of the non-refundable license fee as provided in subsection (e)
11or (e-5) and upon a determination by the Board that the
12applicant is eligible for an owners license pursuant to this
13Act and the rules of the Board. From the effective date of this
14amendatory Act of the 95th General Assembly until (i) 3 years
15after the effective date of this amendatory Act of the 95th
16General Assembly, (ii) the date any organization licensee
17begins to operate a slot machine or video game of chance under
18the Illinois Horse Racing Act of 1975 or this Act, (iii) the
19date that payments begin under subsection (c-5) of Section 13
20of this the Act, (iv) the wagering tax imposed under Section 13
21of this Act is increased by law to reflect a tax rate that is at
22least as stringent or more stringent than the tax rate
23contained in subsection (a-3) of Section 13, or (v) when an

 

 

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1owners licensee holding a license issued pursuant to Section
27.1 of this Act begins conducting gaming, whichever occurs
3first, as a condition of licensure and as an alternative source
4of payment for those funds payable under subsection (c-5) of
5Section 13 of this Act, any owners licensee that holds or
6receives its owners license on or after the effective date of
7this amendatory Act of the 94th General Assembly, other than an
8owners licensee operating a riverboat with adjusted gross
9receipts in calendar year 2004 of less than $200,000,000, must
10pay into the Horse Racing Equity Trust Fund, in addition to any
11other payments required under this Act, an amount equal to 3%
12of the adjusted gross receipts received by the owners licensee.
13The payments required under this Section shall be made by the
14owners licensee to the State Treasurer no later than 3:00
15o'clock p.m. of the day after the day when the adjusted gross
16receipts were received by the owners licensee. A person or
17entity is ineligible to receive an owners license if:
18        (1) the person has been convicted of a felony under the
19    laws of this State, any other state, or the United States;
20        (2) the person has been convicted of any violation of
21    Article 28 of the Criminal Code of 1961 or the Criminal
22    Code of 2012, or substantially similar laws of any other
23    jurisdiction;
24        (3) the person has submitted an application for a
25    license under this Act which contains false information;
26        (4) the person is a member of the Board;

 

 

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1        (5) a person defined in (1), (2), (3), or (4) is an
2    officer, director, or managerial employee of the entity;
3        (6) the entity employs a person defined in (1), (2),
4    (3), or (4) who participates in the management or operation
5    of gambling operations authorized under this Act;
6        (7) (blank); or
7        (8) a license of the person or entity issued under this
8    Act, or a license to own or operate gambling facilities in
9    any other jurisdiction, has been revoked.
10    The Board is expressly prohibited from making changes to
11the requirement that licensees make payment into the Horse
12Racing Equity Trust Fund without the express authority of the
13Illinois General Assembly and making any other rule to
14implement or interpret this amendatory Act of the 95th General
15Assembly. For the purposes of this paragraph, "rules" is given
16the meaning given to that term in Section 1-70 of the Illinois
17Administrative Procedure Act.
18    (b) In determining whether to grant an owners license to an
19applicant, the Board shall consider:
20        (1) the character, reputation, experience, and
21    financial integrity of the applicants and of any other or
22    separate person that either:
23            (A) controls, directly or indirectly, such
24        applicant, or
25            (B) is controlled, directly or indirectly, by such
26        applicant or by a person which controls, directly or

 

 

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1        indirectly, such applicant;
2        (2) the facilities or proposed facilities for the
3    conduct of gambling;
4        (3) the highest prospective total revenue to be derived
5    by the State from the conduct of gambling;
6        (4) the extent to which the ownership of the applicant
7    reflects the diversity of the State by including minority
8    persons, women, and persons with a disability and the good
9    faith affirmative action plan of each applicant to recruit,
10    train and upgrade minority persons, women, and persons with
11    a disability in all employment classifications; the Board
12    shall further consider granting an owners license and
13    giving preference to an applicant under this Section to
14    applicants in which minority persons and women hold
15    ownership interest of at least 16% and 4%, respectively.
16        (4.5) the extent to which the ownership of the
17    applicant includes veterans of service in the armed forces
18    of the United States, and the good faith affirmative action
19    plan of each applicant to recruit, train, and upgrade
20    veterans of service in the armed forces of the United
21    States in all employment classifications;
22        (5) the financial ability of the applicant to purchase
23    and maintain adequate liability and casualty insurance;
24        (6) whether the applicant has adequate capitalization
25    to provide and maintain, for the duration of a license, a
26    riverboat or casino;

 

 

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1        (7) the extent to which the applicant exceeds or meets
2    other standards for the issuance of an owners license which
3    the Board may adopt by rule;
4        (8) the amount of the applicant's license bid;
5        (9) the extent to which the applicant or the proposed
6    host municipality plans to enter into revenue sharing
7    agreements with communities other than the host
8    municipality; and
9        (10) the extent to which the ownership of an applicant
10    includes the most qualified number of minority persons,
11    women, and persons with a disability.
12    (c) Each owners license shall specify the place where the
13casino shall operate or the riverboat shall operate and dock.
14    (d) Each applicant shall submit with his or her
15application, on forms provided by the Board, 2 sets of his or
16her fingerprints.
17    (e) In addition to any licenses authorized under subsection
18(e-5) of this Section, the Board may issue up to 10 licenses
19authorizing the holders of such licenses to own riverboats. In
20the application for an owners license, the applicant shall
21state the dock at which the riverboat is based and the water on
22which the riverboat will be located. The Board shall issue 5
23licenses to become effective not earlier than January 1, 1991.
24Three of such licenses shall authorize riverboat gambling on
25the Mississippi River, or, with approval by the municipality in
26which the riverboat was docked on August 7, 2003 and with Board

 

 

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1approval, be authorized to relocate to a new location, in a
2municipality that (1) borders on the Mississippi River or is
3within 5 miles of the city limits of a municipality that
4borders on the Mississippi River and (2), on August 7, 2003,
5had a riverboat conducting riverboat gambling operations
6pursuant to a license issued under this Act; one of which shall
7authorize riverboat gambling from a home dock in the city of
8East St. Louis; and one of which shall authorize riverboat
9gambling from a home dock in the City of Alton. One other
10license shall authorize riverboat gambling on the Illinois
11River in the City of East Peoria or, with Board approval, shall
12authorize land-based gambling operations anywhere within the
13corporate limits of the City of Peoria. The Board shall issue
14one additional license to become effective not earlier than
15March 1, 1992, which shall authorize riverboat gambling on the
16Des Plaines River in Will County. The Board may issue 4
17additional licenses to become effective not earlier than March
181, 1992. In determining the water upon which riverboats will
19operate, the Board shall consider the economic benefit which
20riverboat gambling confers on the State, and shall seek to
21assure that all regions of the State share in the economic
22benefits of riverboat gambling.
23    In granting all licenses, the Board may give favorable
24consideration to economically depressed areas of the State, to
25applicants presenting plans which provide for significant
26economic development over a large geographic area, and to

 

 

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1applicants who currently operate non-gambling riverboats in
2Illinois. The Board shall review all applications for owners
3licenses, and shall inform each applicant of the Board's
4decision. The Board may grant an owners license to an applicant
5that has not submitted the highest license bid, but if it does
6not select the highest bidder, the Board shall issue a written
7decision explaining why another applicant was selected and
8identifying the factors set forth in this Section that favored
9the winning bidder. The fee for issuance or renewal of a
10license pursuant to this subsection (e) shall be $250,000.
11    (e-5) In addition to licenses authorized under subsection
12(e) of this Section:
13        (1) the Board may issue one owners license authorizing
14    the conduct of casino gambling in the City of Chicago;
15        (2) the Board may issue one owners license authorizing
16    the conduct of riverboat gambling in the City of Danville;
17        (3) the Board may issue one owners license authorizing
18    the conduct of riverboat gambling located in the City of
19    Waukegan;
20        (4) the Board may issue one owners license authorizing
21    the conduct of riverboat gambling in the City of Rockford;
22        (5) the Board may issue one owners license authorizing
23    the conduct of riverboat gambling in a municipality that is
24    wholly or partially located in one of the following
25    townships of Cook County: Bloom, Bremen, Calumet, Rich,
26    Thornton, or Worth Township; and

 

 

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1        (6) the Board may issue one owners license authorizing
2    the conduct of riverboat gambling in the unincorporated
3    area of Williamson County adjacent to the Big Muddy River.
4    Except for the license authorized under paragraph (1), each
5application for a license pursuant to this subsection (e-5)
6shall be submitted to the Board no later than 120 days after
7June 28, 2019 (the effective date of Public Act 101-31) this
8amendatory Act of the 101st General Assembly. All applications
9for a license under this subsection (e-5) shall include the
10nonrefundable application fee and the nonrefundable background
11investigation fee as provided in subsection (d) of Section 6 of
12this Act. In the event that an applicant submits an application
13for a license pursuant to this subsection (e-5) prior to June
1428, 2019 (the effective date of Public Act 101-31) this
15amendatory Act of the 101st General Assembly, such applicant
16shall submit the nonrefundable application fee and background
17investigation fee as provided in subsection (d) of Section 6 of
18this Act no later than 6 months after June 28, 2019 (the
19effective date of Public Act 101-31) this amendatory Act of the
20101st General Assembly.
21    The Board shall consider issuing a license pursuant to
22paragraphs (1) through (6) of this subsection only after the
23corporate authority of the municipality or the county board of
24the county in which the riverboat or casino shall be located
25has certified to the Board the following:
26        (i) that the applicant has negotiated with the

 

 

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1    corporate authority or county board in good faith;
2        (ii) that the applicant and the corporate authority or
3    county board have mutually agreed on the permanent location
4    of the riverboat or casino;
5        (iii) that the applicant and the corporate authority or
6    county board have mutually agreed on the temporary location
7    of the riverboat or casino;
8        (iv) that the applicant and the corporate authority or
9    the county board have mutually agreed on the percentage of
10    revenues that will be shared with the municipality or
11    county, if any;
12        (v) that the applicant and the corporate authority or
13    county board have mutually agreed on any zoning, licensing,
14    public health, or other issues that are within the
15    jurisdiction of the municipality or county; and
16        (vi) that the corporate authority or county board has
17    passed a resolution or ordinance in support of the
18    riverboat or casino in the municipality or county.
19    At least 7 days before the corporate authority of a
20municipality or county board of the county submits a
21certification to the Board concerning items (i) through (vi) of
22this subsection, it shall hold a public hearing to discuss
23items (i) through (vi), as well as any other details concerning
24the proposed riverboat or casino in the municipality or county.
25The corporate authority or county board must subsequently
26memorialize the details concerning the proposed riverboat or

 

 

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1casino in a resolution that must be adopted by a majority of
2the corporate authority or county board before any
3certification is sent to the Board. The Board shall not alter,
4amend, change, or otherwise interfere with any agreement
5between the applicant and the corporate authority of the
6municipality or county board of the county regarding the
7location of any temporary or permanent facility.
8    In addition, within 10 days after June 28, 2019 (the
9effective date of Public Act 101-31) this amendatory Act of the
10101st General Assembly, the Board, with consent and at the
11expense of the City of Chicago, shall select and retain the
12services of a nationally recognized casino gaming feasibility
13consultant. Within 45 days after June 28, 2019 (the effective
14date of Public Act 101-31) this amendatory Act of the 101st
15General Assembly, the consultant shall prepare and deliver to
16the Board a study concerning the feasibility of, and the
17ability to finance, a casino in the City of Chicago. The
18feasibility study shall be delivered to the Mayor of the City
19of Chicago, the Governor, the President of the Senate, and the
20Speaker of the House of Representatives. Ninety days after
21receipt of the feasibility study, the Board shall make a
22determination, based on the results of the feasibility study,
23whether to recommend to the General Assembly that the terms of
24the license under paragraph (1) of this subsection (e-5) should
25be modified. The Board may begin accepting applications for the
26owners license under paragraph (1) of this subsection (e-5)

 

 

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1upon the determination to issue such an owners license.
2    In addition, prior to the Board issuing the owners license
3authorized under paragraph (4) of subsection (e-5), an impact
4study shall be completed to determine what location in the city
5will provide the greater impact to the region, including the
6creation of jobs and the generation of tax revenue.
7    (e-10) The licenses authorized under subsection (e-5) of
8this Section shall be issued within 12 months after the date
9the license application is submitted. If the Board does not
10issue the licenses within that time period, then the Board
11shall give a written explanation to the applicant as to why it
12has not reached a determination and when it reasonably expects
13to make a determination. The fee for the issuance or renewal of
14a license issued pursuant to this subsection (e-10) shall be
15$250,000. Additionally, a licensee located outside of Cook
16County shall pay a minimum initial fee of $17,500 per gaming
17position, and a licensee located in Cook County shall pay a
18minimum initial fee of $30,000 per gaming position. The initial
19fees payable under this subsection (e-10) shall be deposited
20into the Rebuild Illinois Projects Fund. If the Board does not
21issue all licenses within that time period specified in this
22subsection, then the Board shall reopen the license application
23process for those licenses authorized under subsection (e-5)
24that have not been issued. The Board shall follow the licensing
25process laid out in subsection (e-5) with all time frames tied
26to the last date for issuing a license under (e-5) rather than

 

 

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1the effective date of the amendatory Act.
2    (e-15) Each licensee of a license authorized under
3subsection (e-5) of this Section shall make a reconciliation
4payment 3 years after the date the licensee begins operating in
5an amount equal to 75% of the adjusted gross receipts for the
6most lucrative 12-month period of operations, minus an amount
7equal to the initial payment per gaming position paid by the
8specific licensee. Each licensee shall pay a $15,000,000
9reconciliation fee upon issuance of an owners license. If this
10calculation results in a negative amount, then the licensee is
11not entitled to any reimbursement of fees previously paid. This
12reconciliation payment may be made in installments over a
13period of no more than 2 years, subject to Board approval. Any
14installment payments shall include an annual market interest
15rate as determined by the Board. All payments by licensees
16under this subsection (e-15) shall be deposited into the
17Rebuild Illinois Projects Fund.
18    (e-20) In addition to any other revocation powers granted
19to the Board under this Act, the Board may revoke the owners
20license of a licensee which fails to begin conducting gambling
21within 15 months of receipt of the Board's approval of the
22application if the Board determines that license revocation is
23in the best interests of the State.
24    (f) The first 10 owners licenses issued under this Act
25shall permit the holder to own up to 2 riverboats and equipment
26thereon for a period of 3 years after the effective date of the

 

 

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1license. Holders of the first 10 owners licenses must pay the
2annual license fee for each of the 3 years during which they
3are authorized to own riverboats.
4    (g) Upon the termination, expiration, or revocation of each
5of the first 10 licenses, which shall be issued for a 3-year 3
6year period, all licenses are renewable annually upon payment
7of the fee and a determination by the Board that the licensee
8continues to meet all of the requirements of this Act and the
9Board's rules. However, for licenses renewed on or after May 1,
101998, renewal shall be for a period of 4 years, unless the
11Board sets a shorter period.
12    (h) An owners license, except for an owners license issued
13under subsection (e-5) of this Section, shall entitle the
14licensee to own up to 2 riverboats.
15    An owners licensee of a casino or riverboat that is located
16in the City of Chicago pursuant to paragraph (1) of subsection
17(e-5) of this Section shall limit the number of gaming
18positions to 4,000 for such owner. An owners licensee
19authorized under subsection (e) or paragraph (2), (3), (4), or
20(5) of subsection (e-5) of this Section shall limit the number
21of gaming positions to 2,000 for any such owners license. An
22owners licensee authorized under paragraph (6) of subsection
23(e-5) of this Section shall limit the number of gaming
24positions to 1,200 for such owner. The initial fee for each
25gaming position obtained on or after June 28, 2019 (the
26effective date of Public Act 101-31) this amendatory Act of the

 

 

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1101st General Assembly shall be a minimum of $17,500 for
2licensees not located in Cook County and a minimum of $30,000
3for licensees located in Cook County, in addition to the
4reconciliation payment, as set forth in subsection (e-15) of
5this Section. The fees under this subsection (h) shall be
6deposited into the Rebuild Illinois Projects Fund. The fees
7under this subsection (h) that are paid by an owners licensee
8authorized under subsection (e) shall be paid by July 1, 2020.
9    Each owners licensee under subsection (e) of this Section
10shall reserve its gaming positions within 30 days after June
1128, 2019 (the effective date of Public Act 101-31) this
12amendatory Act of the 101st General Assembly. The Board may
13grant an extension to this 30-day period, provided that the
14owners licensee submits a written request and explanation as to
15why it is unable to reserve its positions within the 30-day
16period.
17    Each owners licensee under subsection (e-5) of this Section
18shall reserve its gaming positions within 30 days after
19issuance of its owners license. The Board may grant an
20extension to this 30-day period, provided that the owners
21licensee submits a written request and explanation as to why it
22is unable to reserve its positions within the 30-day period.
23    A licensee may operate both of its riverboats concurrently,
24provided that the total number of gaming positions on both
25riverboats does not exceed the limit established pursuant to
26this subsection. Riverboats licensed to operate on the

 

 

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1Mississippi River and the Illinois River south of Marshall
2County shall have an authorized capacity of at least 500
3persons. Any other riverboat licensed under this Act shall have
4an authorized capacity of at least 400 persons.
5    (h-5) An owners licensee who conducted gambling operations
6prior to January 1, 2012 and obtains positions pursuant to
7Public Act 101-31 this amendatory Act of the 101st General
8Assembly shall make a reconciliation payment 3 years after any
9additional gaming positions begin operating in an amount equal
10to 75% of the owners licensee's average gross receipts for the
11most lucrative 12-month period of operations minus an amount
12equal to the initial fee that the owners licensee paid per
13additional gaming position. For purposes of this subsection
14(h-5), "average gross receipts" means (i) the increase in
15adjusted gross receipts for the most lucrative 12-month period
16of operations over the adjusted gross receipts for 2019,
17multiplied by (ii) the percentage derived by dividing the
18number of additional gaming positions that an owners licensee
19had obtained by the total number of gaming positions operated
20by the owners licensee. If this calculation results in a
21negative amount, then the owners licensee is not entitled to
22any reimbursement of fees previously paid. This reconciliation
23payment may be made in installments over a period of no more
24than 2 years, subject to Board approval. Any installment
25payments shall include an annual market interest rate as
26determined by the Board. These reconciliation payments shall be

 

 

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1deposited into the Rebuild Illinois Projects Fund.
2    (i) A licensed owner is authorized to apply to the Board
3for and, if approved therefor, to receive all licenses from the
4Board necessary for the operation of a riverboat or casino,
5including a liquor license, a license to prepare and serve food
6for human consumption, and other necessary licenses. All use,
7occupation, and excise taxes which apply to the sale of food
8and beverages in this State and all taxes imposed on the sale
9or use of tangible personal property apply to such sales aboard
10the riverboat or in the casino.
11    (j) The Board may issue or re-issue a license authorizing a
12riverboat to dock in a municipality or approve a relocation
13under Section 11.2 only if, prior to the issuance or
14re-issuance of the license or approval, the governing body of
15the municipality in which the riverboat will dock has by a
16majority vote approved the docking of riverboats in the
17municipality. The Board may issue or re-issue a license
18authorizing a riverboat to dock in areas of a county outside
19any municipality or approve a relocation under Section 11.2
20only if, prior to the issuance or re-issuance of the license or
21approval, the governing body of the county has by a majority
22vote approved of the docking of riverboats within such areas.
23    (k) An owners licensee may conduct land-based gambling
24operations upon approval by the Board and payment of a fee of
25$250,000, which shall be deposited into the State Gaming Fund.
26    (l) An owners licensee may conduct gaming at a temporary

 

 

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1facility pending the construction of a permanent facility or
2the remodeling or relocation of an existing facility to
3accommodate gaming participants for up to 24 months after the
4temporary facility begins to conduct gaming. Upon request by an
5owners licensee and upon a showing of good cause by the owners
6licensee, the Board shall extend the period during which the
7licensee may conduct gaming at a temporary facility by up to 12
8months. The Board shall make rules concerning the conduct of
9gaming from temporary facilities.
10(Source: P.A. 100-391, eff. 8-25-17; 100-1152, eff. 12-14-18;
11101-31, eff. 6-28-19; revised 9-20-19.)
 
12    Section 99. Effective date. This Act takes effect upon
13becoming law.