Chicago Approves Ordinance, Stadiums to Open Sportsbooks
Contents
Illinois has seen its fair share of unique rules and regulations relating to sports betting, and the latest news out of the state is sure to excite resident sports bettors. On Monday, a joint City Council Committee agreed to lift the existing ban on sports betting in Chicago to allow five stadiums to establish sportsbooks in and around their premises. The five approved stadiums will be Wrigley Field (Cubs), Guaranteed Rate Field (White Sox), Soldier Field (Bears), the United Center (Bulls and Blackhawks), and Wintrust Arena (Sky and DePaul).
Legislative Details
Chicago Mayor Lori Lightfoot presented the ordinance which was constructed by Alderman Walter Burnett and the Joint Committee for Zoning, Landmarks, and Building Standards and License and Consumer Protection approved it by a vote of 19 to 7. One key point of discussion was the involvement of minority groups in the industry, and the city of Chicago made a promise to “actively seek to achieve racial, ethnic, and geographic diversity when issuing primary sports licenses” as well as encourage minority-owned businesses to apply.
The late language was added to impose a 2% tax on revenue from all wagers made through a licensee within five blocks of its location, whether it is retail or mobile wagering. In addition to the 2% tax, each of the five stadiums will be required to pay a $10 million licensee fee that will be added to the state’s capital funding plan that impacts city projects. Jennie Huang Bennett, Chicago’s chief financial officer, was quoted as saying that the ordinance will provide an “incremental economic impact of approximately $1 million” per year.
Chicago Cubs Ready to Rumble
In addition to other key industry representatives, Chicago Cubs Chairman Tom Ricketts was in attendance on Monday to attest to the team’s preparedness for this moment. Ricketts said his team is “ready to go today” after signing a $100 million partnership with DraftKings in September 2020 that will make Wrigley Field the first MLB stadium to house a sportsbook. Ricketts has already received key zoning approval in August to build the sportsbook that will be over 22,000 square feet in size. Ricketts spoke to the team’s plans with the approval of the ordinance to open a restaurant with a sportsbook by the start of the 2023 season.
Pushback on the Ordinance
While many were excited at the prospect of Chicago sports franchises increasing their involvement with the sports betting industry, the ordinance received plenty of pushback from some parties. Neil Bluhm, Rush Street Gaming co-founder, spoke to his concern that the “five mini-casinos” would “take visitors and money away” from a Chicago casino, citing his company’s belief that the city could stand to lose $10 million to $12 million per year.
To dissuade concerns about Bluhm’s statements, Union Gaming Analytics presented a study that showed sports betting at the five stadiums would cost a Chicago casino “no more than $4.3 million” and Grant Govetsen of Union Gaming said, “there appears to be little to no correlation to sports betting revenue and traditional casino revenue.”
Jerry Reinsdorf, chairman of the White Sox and Bulls, accused Bluhm of playing both sides of the situation, describing how Bluhm “met with us on several occasions to operate sportsbooks in our buildings” and is now actively working against sportsbooks being established in the stadiums. Reinsdorf stated, “it makes me wonder: if he had gotten his way back then, would we be having this meeting today?”
Bally’s, which has two of the other three bids for the downtown Chicago casino license along with Rush Street Gaming, has voiced its full support for this ordinance. Wanda Wilson, a Bally’s board of directors member, stated that they “welcome the presence of retail sportsbooks at Chicago’s legendary professional venues and are confident it will have no impact on our casino revenue expectations.”
Some individuals expressed concern for a lack of focus on minority interests. Anthony Beale, Far South Side Alderman and one of Lightfoot’s most outspoken critics, said “there’s still nothing in it” for minorities, and Budget Committee Chair Pat Dowell described the revised ordinance as having “zero benefits that I can see for minority ownership or involvement or community benefits.” Those statements are on the extreme side, but it will be important for Chicago to remain focused on minority initiatives.
Next Steps
According to Chris Altruda of SportsHandle, the ordinance will now come up for a vote at Wednesday’s regularly scheduled Chicago city council meeting. However, given the number of “no” votes in the committee on Monday, it’s possible a final roll call could be taken. According to the city council’s rules, two aldermen can call for a “Defer and Publish” before roll call to move the vote on the ordinance to the next scheduled meeting which is scheduled for January. However, Lightfoot can maneuver this technicality by adjourning Wednesday’s meeting and calling for another one as early as Friday.
Regardless of what happens tomorrow, it seems very likely that this ordinance will be fully passed by the end of the week and Chicago stadiums will be able to work on developing their sportsbooks in the immediate future. Wrigley Field will likely be the first stadium to launch its sportsbook with DraftKings opening its retail sportsbook in the coming months.
