IGB Meeting Update: July 2021

Every month, the Illinois Gaming Board (“IGB”) meets to discuss any changes in the Illinois gaming market and issue licensing and disciplinary decisions. What follows is a repost of the notes by our friends at Fox Rothschild in their “At Stake” Newsletter. You can also find official IGB meeting minutes on the IGB website.  The minutes of each IGB meeting are typically posted following the next scheduled meeting of the Board.

The IGB held its webinar-based monthly meeting on July 14, 2021. Members present included Member Ramirez, Member Hayden and Chairman Schmadeke. The meeting began with the approval of the June meeting minutes. Neither the Chairman nor the Board Members had any opening comments.

The Administrator opened his comments with the happy news that IGB is making plans for in-person meetings. He is hopeful that the next meeting on September 14, 2021 will be in person, but acknowledged that the health and safety of IGB staff members and the public is still of the utmost importance. He encouraged individuals to continue their mitigation efforts and get vaccinated.

The Administrator continued with an update on the casino license applications status. Besides the approvals from last month’s meeting, there was limited new information. The Administrator stated that the investigation process for Waukegan and South Suburban applicants is ongoing and that the investment banker contract has been finalized.

Next, the Administrator addressed the current national coin shortage. He stated that there will be an emergency rule, similar to the coin shortage emergency rule issued last July. The rule will be issued in the next seven to 14 days. He also stated that they expect to have a permanent rule presented at the September 2021 meeting which would avoid the need for any future emergency rulemaking.

The Administrator reminded interested parties that the IGB is currently assessing agency operations to ensure that current and future operations are consistent and transparent. To assist with those efforts, there are two topics in which the IGB is requesting public comment:

• rules permitting staff to issue opinions in response to industry questions
• modernization of casino conduct and related revisions to current rules, specifically Rules 3000.600 - 671

Public comments are due, electronically, by August 31, 2021 to the email address: IGB.DirectorOfPolicy@illinois.gov.

Revenue Report

Lastly, the Administrator provided his revenue report. The Administrator stated there are 40,181 live video gaming terminals (VGTs) in 7,659 licensed locations across the State. In May, these VGTs generated approximately $228.8 million in Net Terminal Income for the State, with total tax revenue of approximately $78 million. The State received approximately $66 million in taxes with local municipalities receiving approximately $11 million.

In summary, the Administrator said that the combined (video gaming, sports wagering and casino) gaming industry total tax revenue for January 1 through May 31, 2021 is approximately $373.5 million to the State and approximately $74 million in tax revenue to localities, for a grand total of approximately $448 million.

The meeting continued with two speakers during the public commentary section of the meeting.

Teresa Guinzy, Owner of KITT, LLC d/b/a Lucky Dogs addressed the Board and spoke about her pending establishment license which was allegedly submitted back in October of 2020. She informed the IGB that the delay was hurting her business and her ability to be competitive. The Administrator thanked Ms. Guinzy for her comments and stated that staff is working diligently to process retail establishments in accord with the rules and regulations.

Next, Anita Bedell, Executive Director of Illinois Church Action on Alcohol and Addiction Problems, addressed the Board with concerns over the continued absence of a self-exclusion list for video gaming. Ms. Bedell was also concerned that there was no enforcement of underage drinking and gambling. The Administrator replied to Ms. Bedell stating that this Board is just as concerned with underage gambling. He continued to say that the IGB is in compliance with laws and regulations, specifically related to the 2019 law concerning underage sting operations, and that IGB does not comment on ongoing/pending investigations. He concluded by saying the IGB follows the law and is compliant with the law.

The meeting continued with the Administrator presenting proposed new rule 1800.370, related to the deactivation of VGTs. If this sounds familiar it is because the previous administrator addressed this matter as well but did not present the rule to the Joint Committee of Administrative Rules (“JCAR”). Staff is currently working to revise the previous proposed rule to better achieve flexibility and conserve resources for IGB staff. Under this proposed rule, the IGB would have authority to deactivate machines under limited circumstances (such as expiration of a liquor license) and reactivate machines after proof of compliance and payment of $150 VGT reactivation fee per machine.

Casino

The Board began the Casino portion of the meeting with the final approval of the Owners License Renewal for Casino Queen, Inc. d/b/a DraftKings at Casino Queen.

The Board next approved Standard General Focus Fund L.P., as an Institutional Investor Casino Queen, Inc.

There was also a number of Key Person approvals. The following Key Persons are associated with the Rockford casino Applicant, 815 Entertainment, LLC:

• James Allen (President, Chief Executive Officer, and Member of the Board of Managers of Seminole HR Holdings, LLC)
• HR Rockford Owner, LLC (Owner, Business Entity)
• Rockford Casino Development, LLC (Owner, Business Entity)
• Seminole Hard Rock International, LLC (Owner,  Business Entity)
• SHRE/SHRI, LLC (Owner, Business Entity)
• Seminole HR Holdings, LLC (Owner, Business Entity)
• Agnes Billie-Motlow (Member, Board of Managers of Seminole HR Holdings, LLC)
• Danelle R. Boose (Owner)
• Brad Buchanan (Member, Board of Managers of Seminole HR Holdings, LLC)
• John R. Eder (Executive Vice President, CFO, Secretary, Treasurer of Seminole HR Holdings, LLC)
• Jeffrey E. Hook (Executive Vice President of Seminole Hard Rock International, LLC)
• Robert L. Gips (Member, Board of Managers of Seminole HR Holdings, LLC)
• Carla S. Gopher (Member, Board of Managers of Seminole HR Holdings, LLC)
• Alexander Johns (Member, Board of Managers of Seminole HR Holdings, LLC)
• Jon S. Lucas (COO of Hard Rock International, USA, Inc. and Hard Rock entities)
• Jim Shore (Member of HR Rockford Owner, LLC and Seminole HR Holdings, LLC)
• Connie Whidden (Member, Board of Managers of Seminole HR Holdings, LLC)
• Miles E. Bretsch (Owner)
• Daniel Fischer (Owner and President of 815    Entertainment, LLC)
• Brian J. Bear (Owner)
• Karen Eng (Owner)
• Bryan G. Westerman (Owner).

The following Key Persons are associated with the Hawthorne Race Course, Inc.:

• Thomas C. Barry Jr. (Owner, Board Member)
• Anthony Carey (Board Member and Secretary)
• Robert Francis Carey III (Owner, Board Member)
• Timothy Sean Carey (Owner, Board Member, President, and CEO)
• David Allan Collins (Owner, Board Member)
• William Charles Collins Jr. (Owner, Board Member)
• Chrissa Barry-Dolan    (Owner, Board Member)
• Richard William Finn (Owner)
• Thomas Gregory Finn (Owner, Board Member)
• Margaret Barry Jacob (Owner)
• Kevin D. Kline (CEO of Gaming)
• Mark Thomas Monaghan (Owner, Board Member)
• Ruth Ann Moreland (Owner, Board Member)
• Richard T. Finn GST Exempt Trust U/A 2/11/94 FBO Richard W. Finn (Owner)
• Walter F. Jacob and Margaret Barry Jacob Irrevocable Trust (Owner)
• Casey E.B. Allen (Owner)
• Colleen Carey Buckingham (Owner)
• Julie Anne Burke (Owner)
• Lisa M. Barry Cahill (Owner)
• Anthony Clement Carey (Owner)
• John Joseph Carey (Owner)
• Martin Brendan Carey (Owner)
• Margaret Ann Carey (Owner)
• Nancy Therese Carey (Owner)
• Paul Ignatius Carey (Owner)
• Susan Diana Carey (Owner)
• Margaret Mary Coleman (Owner)
• Phillip William Collins (Owner)
• Caroline Collins Combass (Owner)
• Sallie Katherine Combass (Owner)
• Phillip Hunter Combass (Owner)
• Judith Ann Curtin (Owner)
• Lisa Mary Drummond (Owner)
• Helen Carey Ehret (Owner)
• Tierney Patricia Collin Eson (Owner)
• Kathleen Carey Ford (Owner)
• Carolyn Barry Frost (Owner)
• Maura Elizabeth Gates (Owner)
• Kearin Carey Hansen (Owner)
• Erin Ann Hearne (Owner)
• Ellen Janette Henry (Owner)
• George Francis Jacob Sr. (Owner)
• Margaret Gertrude Jacob (Owner)
• Adam Joseph Janette (Owner)
• John William Janette (Owner)
• Molly Carey Johnson (Owner)
• Mary Helen Finn Kramek (Owner)
• Kenneth Eugene Laski (Owner)
• William Michael Laski (Owner)
• Sallie Pauline Collins Maertz (Owner)
• Julie Marie Maurer (Owner)
• Mary Janette McCarley (Owner)
• David Francis Monaghan (Owner)
• Susan Barry Murray (Owner)
• Nancy Laura Nagan (Owner)
• Jeannie Marie O’Neil-Roman (Owner)
• Leah Hannan Carey Smith (Owner)
• Catherine Barry Stack (Owner)
• Taryn Leah Vaughn (Owner)
• Laura Helen Barry Walsh (Owner)
• Margaret Monaghan Whittle (Owner)

The following Key Persons are associated with the Fairmount Park, Inc.:

• Fairmount Holdings, Inc. (Owner)
• Melissa G. Helton (President)
• Harry S. McGehee Jr. (Owner)
• Connie Reames (Secretary/Treasurer)
• William P. Stiritz (Chairman and Director)
• Robert V. Vitale (Director)
• Robert V. Vitale Irrevocable GST Trust (Owner) and
• Melissa Helton (Level 1 Licensee - General Manager)

Also approved were:

• Herman Campuzanoas Regional Director of Internal Audit forElgin Riverboat Resort d/b/a Grand Victoria Casino
• Jason Groveras Regional IT Director for Penn National Gaming and Key Person ofAlton Casino, LLC d/b/a Argosy Casino Alton, HC Aurora, LLC d/b/a Hollywood Casino Aurora, and HC Joliet, LLC d/b/a Hollywood Casino Joliet
• CasinoMoney, Inc. as a Supplier Licensee
• HR Rockford, LLC as a Supplier Licensee

Sports Wagering

The Administrator approved two Level 1 occupational licensees and 22 Level 2 occupational licensees.

Next, the Administrator approved the Level 1, Level 2 and Level 3 licensees that were up for renewal and provided updated information to the IGB, timely paid their renewal fees, and complied with all other requirements were renewed.

Video Gaming

The Video Gaming session began with the Board approving the initial terminal operator licenses of DK Gaming, LLC and Maya Gaming, LLC.

The Administrator then renewed the following suppliers, manufacturer, and terminal operator licenses:

• CountR GmbH
• M3 Technology Solutions, LLC
• G.F.M. Gaming, LLC
• Pocket Aces Gaming, Inc. and
• Illinois Gaming and Coin-Op LLC.

Next, the terminal hander, technician, and location licensees which were up for renewal and provided updated information to the IGB, timely paid their renewal fees, and complied with all other requirements were renewed.

Three locations were issued notices of nonrenewal:

• La Guerita, Inc. d/b/a Pepe’s Mexican Restaurant
• Cryst, Inc. d/b/a Pepe’s Mexican Restaurant and
• Tacos San Jose, Inc. d/b/a Tacos San Jose.

The meeting continued with initial licenses being issued to twenty-nine (29) terminal handlers and 72 video gaming locations.

The Board denied the license applications of the following seven, including for statutory ineligibility:

• Applewood Gaming 1 LLC d/b/a Corky’s Slots
• Dee Bee’s, Inc. d/b/a Dee Bee’s, Inc.
• Sam’s Pizza & Pub, Inc. d/b/a Sam’s Pizza & Pub, Inc.
• Lord of the Wings LLC d/b/a Lord of the Wings LLC
• Mistys Family Restaurant Inc. d/b/a Kersh Café
• Shotgun Eddys, Inc. d/b/a Shotgun Eddys, Inc.
• Lounge 33, LLC d/b/a Lounge 33.

The meeting continued with a new agenda item, specifically related to recissions. This category appears to be licensees that were issued notices of denials, disciplinary complaints, etc. and new or supplemental information was provided during the hearing process which results in a recommendation to rescind the denial, grant the license and allow the licensee to withdraw the hearing request. The two licensees this month are establishment licensees Oak Forest Marathon, Inc. d/b/a Oak Forest Marathon and Bella Banquets Inc d/b/a Via Bella Restaurant.

Oak Forest Marathon, Inc. was previously denied a truck stop license for allegedly missing separate diesel pumps, as is required for truck stops. However, during the hearing process, it allegedly showed plans for, and the subsequent completion of, construction to create separate diesel pumps.

Bella Banquets Inc. allegedly had an issue related to its liquor license, however, through the hearing process it provided evidence the liquor license lapse had been corrected and paid a $1,500 settlement for costs related to the investigation.

In both cases, the Board rescinded the denial, granted the appropriate licensees, and allowed withdrawal of the Hearing Requests.

Next the Board issued a final order adopting the Administrator’s decision in the Rule 320 Petition of J&J Ventures Gaming, LLC, Petitioner, (“J&J”) v. Accel Entertainment Gaming, LLC, Respondent, (“Accel”) and Action Gaming, LLC, Intervenors, (“Action”) Docket No. 17- UP-005, in which Administrator denied J&J’s petition on 18 of 22 locations in question.

The Board received one request for a hearing and two requests to reapply this month.

• The Board voted to deny the hearing request of H’s Bar LLC as the request allegedly did not meet the requirements for a Hearing Request.
• The Board voted to deny the Request to Reapply for Pukar, Inc. d/b/a Times Square North and Pukar, Inc. d/b/a Times Square West.

Like last month, the meeting concluded with the Administrator and Chairman publicly commending staff for putting this meeting together and all their hard work during this pandemic.

Please note there is no August meeting. The next meeting is scheduled for September 14, 2021 and, as noted above, it is expected to be in person. We will provide more information as it becomes available but we can’t wait to see your happy faces!

As always, if you have any questions regarding what happened at this month’s meeting or any pending rules/regulations, please give us a call.