US State Close to Online Gambling Legalization but Unlikely in 2017

January 27th, 2017


US State Close to Online Gambling Legalization but Unlikely in 2017

In 2002, the US Fifth Circuit Court of Appeals ruled that the Federal Wire Act of 1961 prohibited online sports gambling, but there was a bigger grey area still around what it termed "a game of chance". While the Court ruled that the Wire Act does not necessarily prohibit internet gambling outright, the Department of Justice still maintains that it does.

The USA’s online gambling dilemma is confounded by the fact that it's seen as a state issue, not a federal one, meaning that it's decided on a state-by-state basis. In 2010, the New Jersey State Senate passed bill S490 to legalise online gambling, with the exception of sports betting. Other states, such New York, Pennsylvania and now Illinois, are all looking to introduce legislation to define and manage online gambling in its many guises.

Online Gambling Legalization in Illinois Unlikely in 2017

In a fitting parallel to how former President Barack Obama’s White House had to battle with the Republican Senate, so too must Bruce Rauner, Republican Governor of Illinois, fight the Democrat statehouse.

Their deadlock saw Illinois start 2017 without any budget in place, but the machinations are moving forward with 13 bills to tackle the stagnant budget, with one specifically designed to address the issue of gambling in the state. However, it is devoid of any mention of online gambling legislation.

More About Illinois' Online Gambling Bill

The Chicago Sun-Times compared this gambling legislation with those that have been introduced in the past, only to be beaten down into submission by the Senate. It called for more physical brick-and-mortar casinos, including a brand new casino in Chicago city and riverboat casinos spread over the state in south Chicago, Lake County, Rockford, Danville and Williamson County.

It also looks to expand the offerings of horse racing tracks by allowing video slot machines to be installed at these premises. The most glaring omission from the list is online gambling, which was allegedly excluded because of direct opposition from Governor Rauner.

Many see it as a golden opportunity to generate revenue for a hard-hit state and believe it is the only way to stop the land-based casino business from cannibalising itself in an over-saturated market.

State of Daily Fantasy Sports in Illinois

While the fight to legalise online gambling will rage on in Illinois for years to come, another gambling sector is also gearing up in a fight for survival. Daily Fantasy Sports – compressed high-speed versions of season fantasy sport games – was the subject of a bill in Illinois that sought to legislate and regulate the market, which rose to prominence in 2007.

The bill was indefinitely tabled instead of being put out to pasture by a House Judiciary Committee, which is what many analysts expected to happen had it made it that far. The point of the bill was to challenge the view of Attorney General Lisa Madigan, who has made vocal her opinion that Daily Fantasy Sports equate to gambling and are therefore illegal.

The issues surrounding the bill grew hostile as it became the focus of a heated impasse between the gambling industry and the state legislator. The companies that run Daily Fantasy Sports are now left to challenge the Attorney General in open court. To see what other states have legalised DFS, check out our map of all 50 states and their DFS legislation status.

Where in the US Can Players Gamble Online?

So with Illinois gamblers facing a prolonged political stalemate, is there anywhere that they can bet online? Definitely not in Washington state, where it's a crime to play poker online, with a maximum five-year prison sentence if convicted.

North Dakota has also fined players in the past for winning money through online gambling, while in Kentucky, over 140 online domains were seized as they infringed upon the state’s online gaming laws.

The first three states to legalise online gambling were Nevada, New Jersey and Delaware. In a tightly contested race to be the first state to legalise, Nevada legislation was pushed through in February 2013, at the same time as New Jersey, though both lagged behind Delaware where the bill passed in June 2012.

Delaware, then, was slow to implement the legislation, while Nevada was quick off the horse, launching in April 2013. Not to be beaten by Delaware, New Jersey launched on 25th November 2013, just one day before.

While many agree that Illinois will one day adopt online gambling, it remains a question of when the political climate is more positive to the idea. Other states, such as neighbouring Michigan or Massachusetts, are edging closer to that much-coveted legislation. If this does happen, it's a safe bet that Illinois will be quick to follow suit, rather than lose out to a rival state.

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