HB3308ham003 101ST GENERAL ASSEMBLY

Rep. André Thapedi

Filed: 3/21/2019

10100HB3308ham003 LRB101 10689 SMS 58072 a

AMENDMENT TO HOUSE BILL 3308

AMENDMENT NO. ______. Amend House Bill 3308 by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the Sports Wagering Act.

Section 5. Definitions. As used in this Act:

"Board" means the Illinois Gaming Board.

"Gaming facility" means a facility in this State that is authorized to conduct gambling operations under the Riverboat Gambling Act and a facility at which inter-track wagering is conducted pursuant to an inter-track wagering license under the Illinois Horse Racing Act of 1975.

"Interactive sports wagering platform" means a person or entity licensed to offer sports wagering over the Internet, including on websites and mobile devices.

"Official league data" means statistics, results, outcomes, and other data relating to a sporting event obtained pursuant to an agreement with the relevant sports governing body, or an entity expressly authorized by the sports governing body to provide such information to sports wagering operators and interactive sports wagering platforms, which authorizes the use of such data for determining the outcome of tier 2 sports wagers.

"Sports facility" includes Guaranteed Rate Field, located at 333 West 35th Street in Chicago, Soldier Field, located at 1410 Museum Campus Drive in Chicago, United Center, located at 1901 West Madison in Chicago, Wrigley Field, located at 1060 West Addison in Chicago, and the site of a professional golf tournament conducted by the Professional Golfers' Association of America within the State on a temporary basis during the relevant tournament.

"Sports governing body" means the organization that prescribes final rules and enforces codes of conduct with respect to a sporting event and participants therein.

"Sports wagering" means accepting wagers on sporting events or portions of sporting events, or on the individual performance statistics of athletes in a sporting event or combination of sporting events, by any system or method of wagering, including, but not limited to, in person or over the Internet through websites and on mobile devices. "Sports wagering" includes, but is not limited to, single-game bets, teaser bets, parlays, over-under, moneyline, pools, exchange wagering, in-game wagering, in-play bets, proposition bets, and straight bets.

"Sports wagering operator" means an owners licensee under the Riverboat Gambling Act or an organization licensee under the Illinois Horse Racing Act of 1975 that is licensed to offer sports wagering.

"Tier 1 sports wager" means a sports wager that is determined solely by the final score or final outcome of the sporting event and is placed before the sporting event has begun.

"Tier 2 sports wager" means a sports wager that is not a tier 1 sports wager.

"Wager" or "bet" means the staking or risking by a person of something of value upon an agreement or understanding that the person or another person will receive something of value in the event of a certain outcome. "Wager" or "bet" does not include:

(1) any activity governed by the securities laws of the United States or this State;

(2) any contract of indemnity or guarantee;

(3) any contract for insurance; or

(4) participation in any game or contest in which the participants do not stake or risk anything of value other than personal efforts of the participants in playing the game or contest or obtaining access to the Internet, or points or credits that the sponsor of the game or contest provides to participants free of charge and that can be used or redeemed only for participation in games or contests offered by the sponsor.

Section 10. Sports wagering by sports wagering operators.

(a) Sports wagering may not be offered in this State except by a sports wagering operator in accordance with this Act.

(b) A sports wagering operator may offer sports wagering:

(1) in person at the gaming facility; and

(2) over the Internet through an interactive sports wagering platform to persons physically located in this State.

(c) A sports wagering operator may contract with interactive sports wagering platforms to administer sports wagering over the Internet on its behalf.

(d) To offer sports wagering, a sports wagering operator shall pay to the Board an initial fee of $10,000,000. A sports wagering operator shall pay to the Board a renewal fee of $250,000 every 5 years.

Section 15. Sports wagering at a sports facility. No gaming facility may be located at or within a 5-block radius of a sports facility. However, sports wagering may be offered in person at or within a 5-block radius of a sports facility if sports wagering is offered by a sports wagering operator and the sports wagering operator has received written authorization from the Major League Baseball, National Basketball Association, National Football League, or National Hockey League team that plays its home contests at the sports facility or the Professional Golfers' Association of America for a professional golf tournament. If more than one professional sports team plays its home contests at the same sports facility, written authorization is required from all the professional sports teams that play home contests at the sports facility.

Section 20. Sports wagering by interactive sports wagering platforms.

(a) An interactive sports wagering platform may offer sports wagering only if it holds an interactive sports wagering platform license issued by the Board.

(b) An applicant for an interactive sports wagering platform license shall:

(1) submit an application to the Board in the manner prescribed by the Board to verify the interactive sports wagering platform's eligibility under this Act; and

(2) pay an initial fee of $10,000,000.

(c) Every 5 years on or before the anniversary date of the payment of the initial fee made under paragraph (2) of subsection (b), if an interactive sports wagering platform license has been issued, an interactive sports wagering platform shall pay to the Board a license renewal fee of $250,000.

(d) Notwithstanding any other provision of law, an interactive sports wagering platform license application and all documents, reports, and data submitted by an interactive sports wagering platform to the Board containing proprietary information, trade secrets, financial information, or personal information about any person shall be treated by the Board as closed records and shall not to be disclosed to the public unless required by a court order, this Act, or another law.

(e) An interactive sports wagering platform may enter into agreements to offer sports wagering on behalf of one or more sports wagering operators without limitation. Such agreements are not prerequisites to obtaining an interactive sports wagering platform license.

(f) No interactive sports wagering platform may offer sports wagering over the Internet on any device, terminal, or other mechanism that is owned by, controlled by, or otherwise affiliated with a terminal operator licensed under the Video Gaming Act.

Section 25. Sports wagering; consumer protections.

(a) Sports wagering operators and interactive sports wagering platforms shall verify that a person placing a wager, including with respect to online or mobile betting, is of the legal minimum age for placing such a wager.

(b) Sports wagering operators and interactive sports wagering platforms shall allow individuals to restrict themselves from placing wagers with the sports wagering operator or interactive sports wagering platform, including limits on the time spent betting and amounts wagered, and take reasonable steps to prevent those individuals from placing such wagers, including upon request of such individual to share the request with the Board for the sole purpose of disseminating the request to other sports wagering operators and interactive sports wagering platforms.

(c) The Board shall adopt rules that require sports wagering operators and interactive sports wagering platforms to implement responsible gaming programs that include comprehensive employee training on responding to circumstances in which individuals present signs of a gambling addiction.

(d) The Board shall adopt rules to ensure that sports wagering operators' and interactive sports wagering platforms' advertisements for sports wagering:

(1) do not target minors or other persons who are ineligible to place wagers, problem gamblers, or other vulnerable persons, which may include limitations on the form, content, quantity, timing, and location of advertisements;

(2) disclose the identity of the sports wagering operator or interactive sports wagering platform;

(3) provide information about or links to resources relating to gambling addiction; and

(4) are not false, misleading, or deceptive to a reasonable consumer.

(e) A person placing a wager with sports wagering operators and interactive sports wagering platforms shall be at least 21 years of age.

Section 30. Integrity requirements.

(a) Sports wagering operators and interactive sports wagering platforms shall conduct background checks on newly hired employees and annual background checks on all existing employees. Background checks shall include searches for criminal history and any charges or convictions involving corruption or manipulation of sporting events and association with organized crime.

(b) Sports wagering operators and interactive sports wagering platforms shall employ commercially reasonable methods to:

(1) prohibit sports wagering operators and interactive sports wagering platforms, directors, officers, owners, and employees of sports wagering operators and interactive sports wagering platforms, and any relative living in the same household as such persons, from placing bets with sports wagering operators and interactive sports wagering platforms;

(2) prohibit athletes, coaches, referees, team owners, and employees of a sports governing body or its member teams and player and referee union personnel from wagering on any sporting event overseen by their sport's governing body; in determining which persons are excluded from placing wagers under this paragraph, sports wagering operators and interactive sports wagering platforms shall use publicly available information and any lists of such persons that the sports governing body may provide to the Board;

(3) prohibit any individual with access to non-public confidential information held by the sports wagering operator or interactive sports wagering platform from placing wagers with the sports wagering operator or interactive sports wagering platform;

(4) prohibit persons from placing wagers as agents or proxies for others; and

(5) maintain the security of wagering data, customer data, and other confidential information from unauthorized access and dissemination; however, nothing in this Act shall preclude the use of Internet or cloud-based hosting of such data and information or disclosure as required by a court order, another law, or this Act.

(c) A sports governing body may notify the Board that it desires to restrict, limit, or exclude sports wagering on its sporting events by providing notice in the form and manner as the Board may require, including, without limitation, restrictions on the sources of data and associated video upon which a sports wagering operator or interactive sports wagering platform may rely in offering and paying wagers and the bet types that may be offered. Upon receiving such notice, the Board shall only deny a request if it deems such request arbitrary and capricious. If the Board denies a request, the sports governing body shall be afforded notice and the right to be heard and offer proof in opposition to such determination in accordance with the rules of the Board. Offering or taking wagers contrary to restrictions adopted by the Board is a violation of this Section. If a request is submitted in relation to an emergency situation, the chairman of the Board may temporarily grant the request of the sports governing body until the Board makes a final determination as to whether such request is arbitrary and capricious.

(d) The Board shall designate a State law enforcement entity to have primary responsibility for conducting or assisting the Board in conducting investigations into abnormal betting activity, match fixing, and other conduct that corrupts a betting outcome of a sporting event or events for purposes of financial gain.

(e) The Board, sports wagering operators, and interactive sports wagering platforms shall cooperate with investigations conducted by sports governing bodies or law enforcement agencies, including, but not limited to, providing or facilitating the provision of account-level betting information and audio or video files relating to persons placing wagers.

(f) Sports wagering operators and interactive sports wagering platforms shall immediately report to the Board any information relating to:

(1) criminal or disciplinary proceedings commenced against the sports wagering operator or interactive sports wagering platform in connection with its operations;

(2) abnormal betting activity or patterns that may indicate a concern with the integrity of a sporting event or events;

(3) any potential breach of the relevant sports governing body's internal rules and codes of conduct pertaining to sports wagering;

(4) any other conduct that corrupts a betting outcome of a sporting event or events for purposes of financial gain, including match fixing; and

(5) suspicious or illegal wagering activities, including use of funds derived from illegal activity, wagers to conceal or launder funds derived from illegal activity, using agents to place wagers, and using false identification.

Sports wagering operators and interactive sports wagering platforms shall also immediately report information relating to conduct described in paragraphs (1), (2), and (3) to the relevant sports governing body.

(g) Sports wagering operators and interactive sports wagering platforms shall maintain the confidentiality of information provided by a sports governing body to sports wagering operators and interactive sports wagering platforms, unless disclosure is required by this Act, the Board, another law, or a court order.

(h) The Board, sports wagering operators, and interactive sports wagering platforms shall maintain the confidentiality of all information relating to conduct described in paragraphs (1), (2), and (3) of paragraph (f) unless disclosure is required by this Act, another law, or a court order or authorized by the relevant sports governing body. Nothing in this Section prohibits the Board, a sports wagering operator, or an interactive sports wagering platform from making a confidential disclosure to another sports wagering operator, interactive sports wagering platform, a sports governing body, sports betting regulating entity, law enforcement entity, or other party for the purpose of preventing or investigating conduct that corrupts or could corrupt the outcome of a sporting event, including match fixing.

(i) Except as provided in subsection (j), sports wagering operators and interactive sports wagering platforms may use any data source to determine the results of sports wagers if the data is not obtained directly or indirectly from live event attendees who collect the data in violation of the terms of admittance to an event or through automated computer programs that compile data from the Internet in violation of the terms of service of the relevant website or other Internet platform.

(j) A sports governing body may notify the Board that it desires to supply official league data to sports wagering operators for determining the results of tier 2 sports wagers. Such notification shall be made in the form and manner as the Board may require. Within 30 days after such notification by a sports governing body, a sports wagering operator or interactive sports wagering platform shall use only official league data to determine the results of tier 2 sports wagers, unless the sports wagering operator or interactive sports wagering platform can demonstrate to the Board that the sports governing body or its designee cannot provide a feed of official league data to the sports wagering operator or interactive sports wagering platform on commercially reasonable terms.

(k) Any sports governing body may also enter into commercial agreements with sports wagering operators and interactive sports wagering platforms in which the sports governing body may share in the amount of bets or revenues derived from sports wagering on the sports governing body's sporting events. A sports governing body is not required to obtain a license or any other approval from the Board to lawfully accept such amounts or revenues.

Section 35. Recordkeeping; information sharing; sports betting royalty.

(a) Sports wagering operators and interactive sports wagering platforms shall maintain records of all bets and wagers placed, including personally identifiable information of the bettor, amount and type of bet, time the bet was placed, location of the bet, including Internet protocol address, if applicable, the outcome of the bet, records of abnormal betting activity, and video camera recordings in the case of in person wagers for at least 3 years after the sporting event occurs and make such data available for inspection upon request of the Board or as required by a court order.

(b) If a sports governing body has notified the Board that real-time information sharing for wagers placed on its sporting events is necessary and desirable, sports wagering operators and interactive sports wagering platforms shall share in real time, at the account level and in pseudononymous form, the information required to be retained pursuant to subsection (a) (other than video files) with the sports governing body or its designee with respect to wagers on its sporting events. Such information may be used by a sports governing body solely for integrity purposes.

(c) Within 30 days after the end of each calendar quarter, sports wagering operators and interactive sports wagering platforms shall remit to the Board a royalty of 0.25% of the amounts wagered on sporting events.

(1) The royalty shall be remitted on a form as the Board may require, on which the sports wagering operator and interactive sports wagering platform shall identify the percentage of wagering during the reporting period attributable to each sports governing body's sporting events.

(2) No later than April 30 of each year, a sports governing body may submit a request for disbursement funds remitted by sports wagering operators and interactive sports wagering platforms in the previous calendar year. The Board shall disburse the funds to the sports governing body in pro rata proportion of the total amount wagered on its sporting events. No sports governing body is required to obtain a license from the Board in order to lawfully accept the funds provided for in this paragraph (2).

(3) The Board shall annually publish a report stating the amount received from sports wagering operators and interactive sports wagering platforms in royalties and the amount paid to sports governing bodies.

(4) Any unclaimed royalties shall be distributed to the sports wagering operators and interactive sports wagering platforms that timely remitted the royalties required under this subsection (c) to the Board. Such royalties shall be distributed to the eligible sports wagering operators and interactive sports wagering platforms on a pro rata basis.

(d) The Board shall cooperate with sports governing bodies, sports wagering operators, and interactive sports wagering platforms to ensure the timely, efficient, and accurate sharing of information and the remittance of royalties to sports governing bodies or their designees.

Section 40. Privilege tax; State Gaming Fund. For the privilege of offering sports wagering in this State, sports wagering operators and interactive sports wagering platforms shall pay a 12.5% tax on annual adjusted gross receipts to the Board. The Board shall deposit taxes paid under this Section and any fees and penalties collected under this Act into the State Gaming Fund and then transferred in equal amounts to the State Construction Account Fund, the Pension Stabilization Fund, and the Common School Fund.

Section 45. Civil penalty. Any person, firm, corporation, association, agent, or employee who knowingly violates any procedure implemented under this Act shall be liable for a civil penalty of not more than $5,000 for each violation, not to exceed $50,000 for violations arising out of the same transaction or occurrence, which shall accrue to the State and may be recovered in a civil action brought by the Board.

Section 50. Criminal liability.

(a) A person shall be guilty of a Class 1 felony if he or she:

(1) places, or causes to be placed, a bet or wager on the basis of material nonpublic information relating to that bet or wager, while knowing that the information is material nonpublic information; or

(2) knowingly engages in, facilitates, or conceals conduct that intends to improperly influence a betting outcome of a sporting event for purposes of financial gain, in connection with betting or wagering on a sporting event.

(b) Any person or sports wagering operator who violates paragraph (2) of subsection (a) shall be liable to the relevant sports governing body, which sports governing body may sue either at law or in equity in any court of competent jurisdiction.

(c) As used in this Section, a bet or wager is "on the basis of" material nonpublic information relating to that bet or wager if the person placing the bet or wager, or causing it to be placed, was aware of the material nonpublic information when such person placed the bet or wager or caused it to be placed.

Section 90. The Criminal Code of 2012 is amended by changing Sections 28-1 and 28-3 as follows:

(720 ILCS 5/28-1) (from Ch. 38, par. 28-1)

Sec. 28-1. Gambling.

(a) A person commits gambling when he or she:

(1) knowingly plays a game of chance or skill for money or other thing of value, unless excepted in subsection (b) of this Section;

(2) knowingly makes a wager upon the result of any game, contest, or any political nomination, appointment or election;

(3) knowingly operates, keeps, owns, uses, purchases, exhibits, rents, sells, bargains for the sale or lease of, manufactures or distributes any gambling device;

(4) contracts to have or give himself or herself or another the option to buy or sell, or contracts to buy or sell, at a future time, any grain or other commodity whatsoever, or any stock or security of any company, where it is at the time of making such contract intended by both parties thereto that the contract to buy or sell, or the option, whenever exercised, or the contract resulting therefrom, shall be settled, not by the receipt or delivery of such property, but by the payment only of differences in prices thereof; however, the issuance, purchase, sale, exercise, endorsement or guarantee, by or through a person registered with the Secretary of State pursuant to Section 8 of the Illinois Securities Law of 1953, or by or through a person exempt from such registration under said Section 8, of a put, call, or other option to buy or sell securities which have been registered with the Secretary of State or which are exempt from such registration under Section 3 of the Illinois Securities Law of 1953 is not gambling within the meaning of this paragraph (4);

(5) knowingly owns or possesses any book, instrument or apparatus by means of which bets or wagers have been, or are, recorded or registered, or knowingly possesses any money which he has received in the course of a bet or wager;

(6) knowingly sells pools upon the result of any game or contest of skill or chance, political nomination, appointment or election;

(7) knowingly sets up or promotes any lottery or sells, offers to sell or transfers any ticket or share for any lottery;

(8) knowingly sets up or promotes any policy game or sells, offers to sell or knowingly possesses or transfers any policy ticket, slip, record, document or other similar device;

(9) knowingly drafts, prints or publishes any lottery ticket or share, or any policy ticket, slip, record, document or similar device, except for such activity related to lotteries, bingo games and raffles authorized by and conducted in accordance with the laws of Illinois or any other state or foreign government;

(10) knowingly advertises any lottery or policy game, except for such activity related to lotteries, bingo games and raffles authorized by and conducted in accordance with the laws of Illinois or any other state;

(11) knowingly transmits information as to wagers, betting odds, or changes in betting odds by telephone, telegraph, radio, semaphore or similar means; or knowingly installs or maintains equipment for the transmission or receipt of such information; except that nothing in this subdivision (11) prohibits transmission or receipt of such information for use in news reporting of sporting events or contests; or

(12) knowingly establishes, maintains, or operates an Internet site that permits a person to play a game of chance or skill for money or other thing of value by means of the Internet or to make a wager upon the result of any game, contest, political nomination, appointment, or election by means of the Internet. This item (12) does not apply to activities referenced in items (6), and (6.1), and (15) of subsection (b) of this Section.

(b) Participants in any of the following activities shall not be convicted of gambling:

(1) Agreements to compensate for loss caused by the happening of chance including without limitation contracts of indemnity or guaranty and life or health or accident insurance.

(2) Offers of prizes, award or compensation to the actual contestants in any bona fide contest for the determination of skill, speed, strength or endurance or to the owners of animals or vehicles entered in such contest.

(3) Pari-mutuel betting as authorized by the law of this State.

(4) Manufacture of gambling devices, including the acquisition of essential parts therefor and the assembly thereof, for transportation in interstate or foreign commerce to any place outside this State when such transportation is not prohibited by any applicable Federal law; or the manufacture, distribution, or possession of video gaming terminals, as defined in the Video Gaming Act, by manufacturers, distributors, and terminal operators licensed to do so under the Video Gaming Act.

(5) The game commonly known as "bingo", when conducted in accordance with the Bingo License and Tax Act.

(6) Lotteries when conducted by the State of Illinois in accordance with the Illinois Lottery Law. This exemption includes any activity conducted by the Department of Revenue to sell lottery tickets pursuant to the provisions of the Illinois Lottery Law and its rules.

(6.1) The purchase of lottery tickets through the Internet for a lottery conducted by the State of Illinois under the program established in Section 7.12 of the Illinois Lottery Law.

(7) Possession of an antique slot machine that is neither used nor intended to be used in the operation or promotion of any unlawful gambling activity or enterprise. For the purpose of this subparagraph (b)(7), an antique slot machine is one manufactured 25 years ago or earlier.

(8) Raffles and poker runs when conducted in accordance with the Raffles and Poker Runs Act.

(9) Charitable games when conducted in accordance with the Charitable Games Act.

(10) Pull tabs and jar games when conducted under the Illinois Pull Tabs and Jar Games Act.

(11) Gambling games conducted on riverboats when authorized by the Riverboat Gambling Act.

(12) Video gaming terminal games at a licensed establishment, licensed truck stop establishment, licensed fraternal establishment, or licensed veterans establishment when conducted in accordance with the Video Gaming Act.

(13) Games of skill or chance where money or other things of value can be won but no payment or purchase is required to participate.

(14) Savings promotion raffles authorized under Section 5g of the Illinois Banking Act, Section 7008 of the Savings Bank Act, Section 42.7 of the Illinois Credit Union Act, Section 5136B of the National Bank Act (12 U.S.C. 25a), or Section 4 of the Home Owners' Loan Act (12 U.S.C. 1463).

(15) Sports wagering when conducted in accordance with the Sports Wagering Act.

(c) Sentence.

Gambling is a Class A misdemeanor. A second or subsequent conviction under subsections (a)(3) through (a)(12), is a Class 4 felony.

(d) Circumstantial evidence.

In prosecutions under this Section circumstantial evidence shall have the same validity and weight as in any criminal prosecution.

(Source: P.A. 98-644, eff. 6-10-14; 99-149, eff. 1-1-16.)

(720 ILCS 5/28-3) (from Ch. 38, par. 28-3)

Sec. 28-3. Keeping a Gambling Place. A "gambling place" is any real estate, vehicle, boat or any other property whatsoever used for the purposes of gambling other than gambling conducted in the manner authorized by the Riverboat Gambling Act, the Sports Wagering Act, or the Video Gaming Act. Any person who knowingly permits any premises or property owned or occupied by him or under his control to be used as a gambling place commits a Class A misdemeanor. Each subsequent offense is a Class 4 felony. When any premises is determined by the circuit court to be a gambling place:

(a) Such premises is a public nuisance and may be proceeded against as such, and

(b) All licenses, permits or certificates issued by the State of Illinois or any subdivision or public agency thereof authorizing the serving of food or liquor on such premises shall be void; and no license, permit or certificate so cancelled shall be reissued for such premises for a period of 60 days thereafter; nor shall any person convicted of keeping a gambling place be reissued such license for one year from his conviction and, after a second conviction of keeping a gambling place, any such person shall not be reissued such license, and

(c) Such premises of any person who knowingly permits thereon a violation of any Section of this Article shall be held liable for, and may be sold to pay any unsatisfied judgment that may be recovered and any unsatisfied fine that may be levied under any Section of this Article.

(Source: P.A. 96-34, eff. 7-13-09.)

Section 99. Effective date. This Act takes effect upon becoming law.".