IGB Meeting Update: September 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 monthly meeting on September 9, 2021. While we had hopes that it would be an in-person meeting, the IGB decided a webinar-based meeting was more appropriate at this time. Members present included Member Garcia, Member Hayden and Chairman Schmadeke. The meeting began with the approval of the July meeting minutes.

The Administrator opened his comments with a brief discussion of the statewide mask mandate for all indoor gaming operations. He stated that licensees must be in compliance with COVID mitigation measures and that failure to comply with such measures may result in disciplinary action. He further encouraged individuals who are able to get vaccinated.

The Administrator continued by thanking those who submitted suggestions regarding 1) the rules permitting staff to issue opinions in response to industry questions and 2) the modernization of current casino rules. The public comment window closed on August 31, 2021, and it is expected that the comments will be available for public review by next week. Staff will review and present proposed new and/or amended rules at a future meeting.

Next, the Administrator summarized the progress on implementation of the gaming expansion bill and gave a brief update on the South Suburban and Waukegan casino licenses and their bidding processes. The Administrator stated that there is a Special IGB Meeting scheduled for October 13, 2021 at 9am in which the proposed applicants for each license will have an opportunity to make presentations to the Board. Further, the Administrator stated that it is expected that by January 2022 (six months from the date the investment banker was engaged), the Board will have approved the bid winners and issued a finding of preliminary suitability to an applicant from the South Suburbs and from Waukegan.

The Administrator then provided his revenue report. The Administrator stated there are currently 41,129 live video gaming terminals (VGTs) in 7,763 licensed locations across the State. In July, these VGTs generated approximately $223 million in Net Terminal Income, with total tax revenue of approximately $76 million. The state received approximately $64 million in taxes and local municipalities received 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 thru July 31, 2021 is approximately $560 million to the State and approximately $109 million in tax revenue to localities for a grand total of approximately $670 million.

The Administrator continued with commentary regarding the Illinois fall legislative session in which he hopes the following three gaming matters will be finalized:

• harmonization of renewal dates for licensees holding more than one type of license including changing renewal periods from one year to four years for video gaming licensees
• licensing of video gaming sales brokers or sales agents
• criminalization and prohibition of sweepstake machines

After the Administrator’s comments, the meeting continued with administrative matters in which the Board approved the adoption of the IGB’s Diversity, Equity, and Inclusion Mission Statement (as mandated by Governor Pritzker’s Executive Order 16) and approved delegation of authority to the Administrator to approve (or deny) temporary casino facilities, final practice sessions for casinos, and temporary operating permits for casinos. Notably, the Board did not delegate the authority to issue final casino licensing approvals.

Casino

The Board began the Casino portion of the meeting by approving the Request to Amend the Owners License Application of Walker’s Bluff Casino Resort, LLC. The proposed amendment would allow the applicant to forego building a temporary casino and focus solely on constructing the permanent facilities due to challenges of construction. The revised development plans were approved by the locality, Williamson County. Construction is expected to begin in the fourth quarter of 2021, possibly in October. The applicant said it expects the casino to open within 18 months after construction begins.

Next, the Board approved 240 occupational licensees in the Level 2 category and 259 occupational licensees in the Level 3 category. The Administrator also 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.

Sports Wagering

The Administrator approved four hundred seventy-one (471) Level 2 occupational licensees and eight (8) Level 3 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 Administrator renewing the following suppliers, manufacturer, distributor and terminal operator licenses:

• Aristocrat Technologies, Inc.
• Konami Gaming, Inc.
• American Vending Sales, inc. d/b/a AVS Companies
• H. Betti Industries, Inc.
• JCM American Corp.
• Inspired Gaming (USA) Inc.
• Inspired Gaming (UK) Limited
• A1_Keshav Krupa LLC d/b/a Midwest VG Solutions
• Action Video Gaming, LLC
• Donico Gaming, LLC
• Game On Entertainment, LLC d/b/a Game On Entertainment
• Veterans VGT, LLC
• Winner’s Choice Gaming, LLC
• A & A Gaming Inc.
• Aces Up Gaming LLC

Next, the terminal hander, 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.

Seven locations were issued notices of nonrenewal:

• Wilson Liquor PB, LLC d/b/a Wilson’s Liquor PB, LLC
• Shri Gasoline Inc., d/b/a BP Shop
• TR Restaurant Group, Inc. d/b/a R.B.I.’s
• Muaremi Inc. d/b/a Mustang’s Bar & Grill
• Fos Inc. d/b/a Casey’s Pub
• GRD of Neoga, Inc. d/b/a The Depot of Neoga
• Tammy Diane Kerley and Joseph Glen Kerley – Partnership d/b/a Beehive Lounge.

The meeting continued with initial licenses being issued to 142 terminal handlers, two technicians and 144 video gaming locations.

The Board denied the license applications of the following five locations, including denials for statutory ineligibility:

• D D & M Petroleum, Inc. d/b/a McCook BP
• Imperial Pub Corp. d/b/a Imperial Pub
• My Bubby LLC d/b/a Bubby’s Backroads Bar
• Bok Choy Asian Kitchen Addison Inc. d/b/a Bok Choy Asian Kitchen
• Black Bear Enterprises, Inc. d/b/a Village Inn of Wauconda

Next the Board issued two final orders adopting the Administrator’s decision in the Rule 320 Petitions of Pug Mahones, Inc. d/b/a Pug Mahones Irish Pub & Grill, Petitioner, (“Pug”) v. Gaming & Entertainment Management -Illinois LLC, Respondent, (“GEM”), 18-UP-017 (“Pug v. GEM”) and Accel Entertainment Gaming, LLC, Petitioner, (“Accel”) v. Midwest Electronics Gaming, LLC, Respondent, Re: Bink, Inc. d/b/a Feeling Lucky Lounge (License no. 120700343) 17-UP-006; Re: American Legion Clarence V. Scheel Post No. 292 of Mascoutah, Illinois (License no. 120906386) 18-UP-015; and Re: JJJR Silver Creek Inc. d/b/a Silver Creek Saloon (License no. 120712650) 19-UP-009 (“Accel v. Midwest”).

In Pug v. GEM, the Administrator denied the petition for being defective and failing to comply with the submission requirements of the Board rules. In Accel v. Midwest, the Administrator granted Accel’s request to withdraw its petitions.

The Board received one request for a hearing this month. The request, from Lounge 33, LLC d/b/a Lounge 33, allegedly failed to prove a prime facie case (that the location was located over 100 feet from a church) and therefore the Board denied the request. In his discussions, the Administrator reviewed Rule 820 which defines how distance should be measured for locations within 100 feet of religious buildings.

The meeting concluded with the review of the Administrative Law Judge’s recommendation decision in the matter of In re: The Discipline of ANNABCICERO INC., d/b/a Big Top and ANNABCICERO2 INC., d/b/a Big Top 2 in which the license revocation was deemed appropriate despite the location having new ownership.

Please note that a special meeting will be held on October 13,2021 at 9 a.m. for presentations related to casino applicants as well as the regularly scheduled meeting on October 20, 2021. It has not been determined whether these meetings will be virtual or in-person. We will provide an update when we receive one.

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.