The most influential backer of legal sports betting in Illinois’ legislature has exited stage left, only furthering the ongoing drama over the issue in Springfield.
According to a report from Chicago’s WBEZ 91.5, Rep. Michael Zalewski has recused himself from the negotiations involving potential sports betting legislation. The main reason is because the Chicago law firm that employs Zalewski - Taft, Stettinius & Hollister LLP - is engaged in lobbying on behalf of several parties that have stakes in legal sports betting.
While Taft himself hasn’t done any such lobbying, he states that complaints have been raised and he is stepping aside to avoid any perception of a conflict of interest. Rep. Robert Rita, another outspoken gaming backer, will take Zalewski’s place.
With the state’s legislative term ending Friday, it’s almost certain that sports betting won’t be legal in the state in time for the next Chicago Bears and Fighting Illini football seasons, let alone before the end of the Chicago Cubs' 2019 season. It’s uncertain to what extent Rita replacing Zalewski may further delay the process which has already been tumultuous, even by the standards of sports betting legislation in other states.
Sports Betting Seldom Moves Simply
Zalewski may have had not been able to push his unique ideas about how to proceed in legalizing sports betting, but he was clearly among the most active on that front. His proposals on the framework of the regulation changed over time, including issues like official data mandates and how quickly mobile betting should be rolled out, complex and controversial issues that have derailed similar efforts in other states.
For example, a past amendment proposed by Zalewski would have put potential sportsbook operators DraftKings and FanDuel in a “penalty box,” delaying their debuts in the state as a punishment for offering fantasy contests to Illinois residents while considered to be illegal by the state’s attorney general. This “bad actors” clause, not surprisingly, did not sit well with these companies, which have been some of the top revenue producers among New Jersey sports betting operators in the past year.
His most recent proposal before giving way to Rita was to instead impose a total moratorium of 540 days on all online sports betting. Now with Zalewski sidelined, Rita seems to be taking yet a different direction.
New Direction Leaves New Questions
Rita’s possible concession to the casino industry, as a means to gain their support, is the passage of a bill that would allow for six more casinos to be opened in the state. The bill would authorize five new riverboat licenses and a new land-based facility in Chicago.
It’s uncertain whether that would be sufficient to get the state’s casinos to back off pushing for DraftKings and FanDuel to be excluded, at least to start with. It’s also likely that if a casino expansion bill is passed, the state’s racetracks and sporting facilities will also push for some concessions before lending their support.
Zalewski’s latest amendment included the facilities in the pool of potential licensees but taxed their handle at a rate of 20 percent, which would be among the highest in the nation. A reduction in that rate could be a negotiating tool.
By taking the reins from Zalewski, Rita now just the latest leader in a situation that seems to perpetually shift – and become increasingly untenable. The only thing that seems certain is that if a bill is passed before the legislature adjourns for the summer, it will be the result of a remarkable bit of negotiation by Rita.