IGB Meeting Update: September 2020

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 Illinois Gaming Board held its webinar-based monthly meeting on September 17, 2020. As a reminder, the Board previously delegated authority to the Administrator to act on certain matters, so certain items were approved at this meeting without a Board motion/vote.

Members present included Chairman Schmadeke, Member Ramirez, Member Hayden, and Member Garcia. The meeting began with the approval of the Board’s July 30, 2020 meeting minutes. The Chairman did not provide any opening comments.

ADMINISTRATOR’S REPORT

Administrator Fruchter began his comments by thanking IGB staff for their hard work during these difficult times. The Board has an enormous amount of work on its hands, and IGB staff is doing everything they can to keep the casino, video gaming and sports wagering industries active and safe while working to maintain the integrity and security of the industries.

Administrator Fruchter acknowledged that the casinos and video gaming establishments/licensees are all being affected by COVID mitigation efforts and encouraged people to visit the Illinois Department of Commerce & Economic Opportunity’s (DCEO) website for information on the Restore Illinois plan for safely reopening Illinois. The Restore Illinois plan can be found on the DCEO’s website here: Restore Illinois.

Administrator Fruchter stated that the Board and IGB Staff are mindful of the statutory timeline to review new casino applications, but the Board is equally mindful of its absolute obligation to ensure that the new application process is ethical, transparent and compliant with the law and that no corners will be cut in reviewing application submissions. Administrator Fruchter ensured the industry that the Board and IGB Staff will remain focused and faithful to the process and statutory timeline and will fulfill its statutory obligations without sacrificing integrity, independence, or ethics. Administrator Fruchter reminded the industry that untimely, incomplete and/or inaccurate disclosures create more work for IGB Staff and create delays in the review and approval process. While it was left unsaid, based on the Administrator’s comments, we are of the opinion that Staff has not completed its investigations on the new applications and IGB will seek an extension of time within which to review and award licenses.

Administrator Fruchter provided an update on sports wagering, which he said is beginning to take shape in Illinois. Seven of the 10 casinos have received approval to begin sports wagering operations. Four casinos have both online and in-person wagering and three casinos have only in-person wagering. One horse track (Hawthorne Casino and Race Couse) is licensed to offer sports wagering. Despite many obstacles in these trying times, the first sports wagering revenue report gives reasons to be optimistic about the future of the industry. Plus, as Administrator Fruchter mentioned, both the Cubs and Sox are in first place in their respective Divisions and, although he didn’t say this, possibly heading towards a rematch of the 1906 World Series. The link for the revenue reports can be found here:

Administrator Fruchter also provided an update on video gaming. Currently there are approximately 7,275 locations with a total of 36,435 VGTs in operations. He stated that over 3,000 establishments are operating with more than five video gaming terminals. He also stated that the IGB will be releasing more information in the coming weeks about Rule 320 concerning use agreement petitions. IGB rulings on Rule 320 Petitions may also be coming soon and a revised inducement rule should be forthcoming. Administrator Fruchter also reminded the industry that the IGB Rules impose ongoing duties on licensees to conduct themselves in a professional manner when dealing with the public, competitors, customers, and the Board.

PUBLIC COMMENTARY

There was only one public speaker during the public commentary section: Anita Bedell, Executive Director of the Illinois Church Action on Alcohol and Addiction Problems. Ms. Bedell shared her disappointment that Governor Pritzker reinstated the in-person registration for sports wagering until September 19, 2020. She also voiced her displeasure with certain sports wagering advertisements and partnerships.

ADMINISTRATIVE MATTERS

The Administrator spoke briefly to discuss proposed Sports Wagering Rule 1900.1460, which deals with software change management, testing, and certification. He also indicated that he will be filing identical or nearly identical emergency rules to mirror Sports Wagering Rule 1900.1460. The Board also approved proposed amendments to Video Gaming Rules 1800.570 and 1800.580, which deal with annual fees and clarifying that an annual fee is due even if a licensee has a pending disciplinary action. We will send out the rules once they are published in the Illinois Register. Administrator Fruchter was also delegated the authority to approve licensees’ requests to withdraw hearing requests, which will streamline the process of resolving and/or settling hearing requests concerning the denial of initial or renewal applications.

CASINO

The Casino meeting began with the Board stating that Elgin Riverboat Resort d/b/a Grand Victoria Casino will be on the Board’s next monthly agenda for final consideration of its license renewal. The Board next approved Midwest Gaming & Entertainment d/b/a Rivers Casino’s request for initial consideration of license renewal, wavier of the two-meeting rule, and final consideration.

The Board next approved the following Key Persons, Supplier licensees, or Level 1 Occupational licensees:

• Cooper B. Bluhm as a Key Person for Midwest Gaming & Entertainment, LLC d/b/a Rivers Casino – Des Plaines
• Nicholas B. Helfand as a Key Person for Midwest Gaming & Entertainment, LLC d/b/a Rivers Casino – Des Plaines
• William G. Helfand as a Key Person for Midwest Gaming & Entertainment, LLC d/b/a Rivers Casino – Des Plaines
• Anna B. Wolf as a Key Person for Midwest Gaming & Entertainment, LLC d/b/a Rivers Casino – Des Plaines
• James M. Wolf as a Key Person for Midwest Gaming & Entertainment, LLC d/b/a Rivers Casino – Des Plaines
• Matthew Wilson as a Supplier licensee for SG Gaming, Inc. d/b/a Scientific Games
• William Joe Gustafson as a Level 1 Occupational licensee for Grand Victoria Casino
• Norris Hamilton Gustafson as a Level 1 Occupational licensee for Des Plaines Development Limited Partnership d/b/a Harrah’s Joliet Casino & Hotel.

The Board also approved 17 Level 2 and 19 Level 3 Occupational licensees. The IGB approved the renewal of the occupational licensees that were renewed in August 2019 and provided updated information to the IGB, timely paid their renewal fees, and complied with all other requirements.

SPORTS WAGERING

The Board approved 11 Sports Wagering Occupational Level 1 licenses, 192 Level 2 licensees, and five Level 3 licensees.

VIDEO GAMING

The video gaming portion of the meeting began with the Administrator renewing the licenses of:

• Aristocrat Technologies, Inc.
• Konami Gaming, Inc.
• JCM American Corporation
• Inspired Gaming (UK) Limited [and US]
• American Vending Sales, Inc.

The Administrator approved the initial terminal operator license for A&A Gaming, Inc. Next, the terminal handler, technician, and location 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. Thirty-six were approved and three were denied.

The following Manufacturer, Distributor, Supplier, and Terminal Operator licenses were renewed: 

• A1_Keshav Krupa LLC
• Action Video Gaming, LLC
• Donico Gaming, LLC
• Game On Entertainment, LLC
• Winner’s Choice Gaming, LLC
• Veterans VGT, LLC
• Gages Up LLC
• Heck Gaming, LLC
• Midwest SRO, LLC
• Arkadian Gaming, LLC

The meeting continued with 172 new video gaming establishments being approved for licenses and the following ten applicants were denied licenses:

• CJS 2 LLC d/b/a CJ’s GAMING 2
• EVOLUTION RIVER STREET, INC. d/b/a BAR EVOLUTION
• GRUPPOF4 INC d/b/a CAFE ROMA
• Netty Parker’s Windmill Pub Inc. d/b/a Netty Parker’s Windmill Pub Inc.
• PAL JOE’S BATAVIA, INC. d/b/a PAL JOEY’S
• SBBL, LLC d/b/a Brauer House
• Twisted Spoke Saloon Corporation d/b/a Twisted Spoke Saloon
• UTOPIA, INC. d/b/a UTOPIA
• KC 2120 Club d/b/a KC 2120 Club
• KMS Enterprises, LLC d/b/a Sinisi’s On Main

A previously denied applicant, ROCCOVINO’S, INC. d/b/a Roccovinos Restaurante & Pizza, said it had sent in a withdrawal letter (prior to the denial) but IGB was unable to locate it.  Based on that, IGB rescinded the denial and permitted the location to withdraw. 

Finally, Long Grove Pizza & BBQ, LLC d/b/a Village Pizza & BBQ of Long Grove had its hearing request denied.

LITIGATION / SETTLEMENTS FOR DISCIPLINARY COMPLAINTS

The Administrator and Board approved settlements relating to the following cases: Culp v. Harrah’s Illinois Corp., et al., Case No. 1:17-cv-00252, and Thorpe, et al. v. Harrah’s Illinois Corp., et al., Case No. 1:17-cv-04450. The Board also rescinded its original denial and issued a video gaming establishment license to TINLEY BEEF LLC d/b/a POP’S ITALIAN BEEF.

The meeting was then adjourned. The next IGB meeting is scheduled for November 5, 2020.