HB5791 103RD GENERAL ASSEMBLY

LRB103 39952 CES 71411 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB5791

Introduced 3/22/2024, by Rep. Kam Buckner

SYNOPSIS AS INTRODUCED:

See Index

Amends the Video Gaming Act. Provides that an applicant or licensee under the Act is not in violation of the Act or specified rules and shall not be subject to disciplinary action for operating a gaming device if operation of the gaming device is in compliance with and not considered gambling under the Criminal Code of 2012. Provides for the creation of a Gaming Disparity Task Force to conduct a disparity and availability study. Provides that the Task Force shall compile, collect, or otherwise gather data necessary for the determination of the impact on minorities within the video gaming industry. Allows the Task Force to impose fees for the Task Force's operation collected by the Illinois Gaming Board on terminal operations that general more than $5,000,000, including for specified payments to a minority business enterprise-owed terminal operator. Amends the Criminal Code of 2012. Changes the definition of "gambling device" to include any vending or other electronic machine or device, including, without limitation, a machine or device that awards credits and contains a circuit, meter, or switch capable of removing and recording the removal of credits that is connected directly or indirectly to the Internet, either by cellular modem, hard wire, or wireless connection, or to a set of interconnected networked devices in order to participate in the game or contest or to receive or retrieve any data related to the device unless the connected device is a redemption vault and does not operate with a self-contained fill system that permits the operation of the device solely determined on a fee basis or the amount of revenue generated, but does not include a system based on time, number of spins or spin equivalent, or other nonrevenue based system, and automatically ceases to operate upon the completion of a pre-determined cycle. Provides that participants in a game of skill or chance where money or other things of value can be won but no payment or purchase is required to participate shall not be convicted of gambling except where participation in such game of skill or chance is accomplished using a gambling device prohibited by law. Provides that a gambling offense involving such a gambling device is a Class 4 felony. Effective immediately.

A BILL FOR

AN ACT concerning gaming.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Video Gaming Act is amended by changing Section 35 and by adding Section 76 as follows:

(230 ILCS 40/35)

Sec. 35. Display of license; confiscation; violation as felony.

(a) Each video gaming terminal shall be licensed by the Board before placement or operation on the premises of a licensed establishment, licensed truck stop establishment, licensed large truck stop establishment, licensed fraternal establishment, or licensed veterans establishment. The license of each video gaming terminal shall be maintained at the location where the video gaming terminal is operated. Failure to do so is a petty offense with a fine not to exceed $100. Any licensed establishment, licensed truck stop establishment, licensed large truck stop establishment, licensed fraternal establishment, or licensed veterans establishment used for the conduct of gambling games in violation of this Act shall be considered a gambling place in violation of Section 28-3 of the Criminal Code of 2012. Every gambling device found in a licensed establishment, licensed truck stop establishment, licensed large truck stop establishment, licensed fraternal establishment, or licensed veterans establishment operating gambling games in violation of this Act shall be subject to seizure, confiscation, and destruction as provided in Section 28-5 of the Criminal Code of 2012. Any license issued under the Liquor Control Act of 1934 to any owner or operator of a licensed establishment, licensed truck stop establishment, licensed large truck stop establishment, licensed fraternal establishment, or licensed veterans establishment that operates or permits the operation of a video gaming terminal within its establishment in violation of this Act shall be immediately revoked. No person may own, operate, have in his or her possession or custody or under his or her control, or permit to be kept in any place under his or her possession or control, any device that awards credits and contains a circuit, meter, or switch capable of removing and recording the removal of credits when the award of credits is dependent upon chance.

Nothing in this Section shall be deemed to prohibit the use of a game device only if the game device is used in an activity that is not gambling under subsection (b) of Section 28-1 of the Criminal Code of 2012. An applicant or licensee under this Act is not in violation of this Act or any of the Illinois Gaming Board rules specific to Illinois Gaming Board Rule 1800.420 and shall not be subject to disciplinary action, delay of any Board consideration, or denial of any license for operating a gaming device if operation of the gaming device is in compliance with, and not considered gambling under, subsection (b) of Section 28-1 or item (iii) of subsection (a) 28-2 of the Criminal Code of 2012.

A violation of this Section is a Class 4 felony. All devices that are owned, operated, or possessed in violation of this Section are hereby declared to be public nuisances and shall be subject to seizure, confiscation, and destruction as provided in Section 28-5 of the Criminal Code of 2012.

The provisions of this Section do not apply to devices or electronic video game terminals licensed pursuant to this Act. A video gaming terminal operated for amusement only and bearing a valid amusement tax sticker shall not be subject to this Section until 30 days after the Board establishes that the central communications system is functional.

(b) (1) The odds of winning each video game shall be posted on or near each video gaming terminal. The manner in which the odds are calculated and how they are posted shall be determined by the Board by rule.

(2) No video gaming terminal licensed under this Act may be played except during the legal hours of operation allowed for the consumption of alcoholic beverages at the licensed establishment, licensed fraternal establishment, or licensed veterans establishment. A licensed establishment, licensed fraternal establishment, or licensed veterans establishment that violates this subsection is subject to termination of its license by the Board.

(Source: P.A. 101-31, eff. 6-28-19.)

(230 ILCS 40/76 new)

Sec. 76. Gaming Disparity Task Force.

(a) The Gaming Disparity Task Force is created. The Governor shall appoint 5 members, including the Chair. The Chair shall set the agenda and staff the Task Force and take all other actions necessary to complete the mission of identifying disparities in the video gambling industry.

(b) The Task Force may:

(1) maintain a staff;

(2) make recommendations for policy, statute, and rule changes;

(3) collect data both in Illinois and outside Illinois regarding the regulation of gaming and quasi-gaming, including requiring terminal operators to submit detailed information regarding ownership, revenues, and moneys spent on goods and services and any other information deemed necessary to identify disparities in gaming and lack of minority business enterprise participation;

(4) compile or assist in the compilation of any reports required by this Act;

(5) ensure the coordination of efforts between various State agencies involved in regulating and taxing gaming or quasi-gaming in Illinois; and

(6) encourage, promote, suggest, and report best practices for ensuring diversity in the gaming and quasi-gaming industry in Illinois.

(c) Any funding required for the Task Force, its staff, or its activities shall be drawn from a fee determined by the Task Force and collected by the Illinois Gaming Board to be paid by terminal operators that generate at least $5,000,000 of net terminal income in any given month.

(d) The Task Force shall commission and publish an annual disparity and availability study that: (1) evaluates whether there exists discrimination in the State's gaming industry; and (2) if so, evaluates the impact of such discrimination on the State and includes recommendations to the Illinois Gaming Board for reducing or eliminating any identified barriers to entry in the video gaming market.

The Task Force may compile, collect, or otherwise gather data necessary for the administration of this Section and to carry out the Task Force's duty relating to the recommendation of policy changes.

(e) The Task Force shall hold public meetings and issue subpoenas, if necessary, for testimony.

(f) The Task Force shall submit a copy of the annual study to the General Assembly no later than February 1 of each year in the manner provided for reports to the General Assembly under Section 3.1 of the General Assembly Organization Act.

(g) From any fees collected under subsection (c), the Task Force shall set aside payment to a minority business enterprise-owned terminal operator as provided in this subsection. The Task Force shall direct the Illinois Gaming Board to approve a minority business enterprise to receive the payment as a licensee or person of significant control. Payment to the minority business enterprise shall commence upon the filing of forms with the Illinois Gaming Board as designated by the Board. The Task Force shall calculate the percentage of the fees collected under subsection (c) that shall be set aside to pay to the minority business enterprise-owned terminal operation by calculating the percentage of Illinois' population of the minority group or minority groups of which the minority person or persons who own the terminal operation are part. As used in this subsection, "minority person" has the meaning given to that term in Section 8.12 of the Business Corporation Act of 1983.

(h) The Task Force shall establish a process for the sunset of devices exempted under paragraph (13) of subsection (b) of Section 28-1 of the Criminal Code of 2012 and Section 35 of the Video Gaming Act. The Task Force shall consider such factors deemed reasonably necessary to rectify disparities in gaming when developing the sunset process. The Task Force shall include, at a minimum, in the process: the authorization of video gambling in any municipality with a population more than 2,000,000 people; the opportunity for all statutorily eligible establishments in any municipality with a population more than 2,000,000 people to apply for a video gaming license; consideration and determination by the Illinois Gaming Board of all statutorily eligible establishments in any municipality with a population more than 2,000,000 people that applied for a video gaming license and any denied applicant had an opportunity to exhaust all administrative and judicial remedies; all eligible and licensed minority establishments in any municipality with a population more than 2,000,000 people has been authorized to commence gambling by the Illinois Gaming Board; and following an independent auditor, selected by the Task Force pursuant to the request-for-proposal process, issues a report documenting that there is a majority of licensed establishments operated by a minority business enterprise terminal operator in any municipality with a population more than 2,000,000 people.

Section 10. The Criminal Code of 2012 is amended by changing Sections 28-1 and 28-2 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), (6.1), (8), (8.1), 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.

(8.1) The purchase of raffle chances for a raffle 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 when authorized by the Illinois Gambling Act.

(12) Video gaming terminal games at a licensed establishment, licensed truck stop establishment, licensed large 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, except where participation in such game of skill or chance is accomplished using a gambling device prohibited by item (a)(iii) of Section 28-2.

(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.

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

(2) Notwithstanding subsection (c)(1), or anything else contained in this Section to the contrary, a gambling offense involving a device described in item (a)(iii) Section 28-2 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. 101-31, Article 25, Section 25-915, eff. 6-28-19; 101-31, Article 35, Section 35-80, eff. 6-28-19; 101-109, eff. 7-19-19; 102-558, eff. 8-20-21.)

(720 ILCS 5/28-2) (from Ch. 38, par. 28-2)

Sec. 28-2. Definitions.

(a) A "gambling device" is (i) any clock, tape machine, slot machine or other machines or device for the reception of money or other thing of value on chance or skill or upon the action of which money or other thing of value is staked, hazarded, bet, won, or lost; (ii) or any mechanism, furniture, fixture, equipment, or other device designed primarily for use in a gambling place; or (iii) any vending or other electronic machine or device, including, without limitation a machine or device that awards credits and contains a circuit, meter, or switch capable of removing and recording the removal of credits or that is connected directly or indirectly to the Internet, either by cellular modem, hard wire, or wireless connection, or to a set of interconnected networked devices in order to participate in the game or contest or to receive or retrieve any data related to the device unless the connected device is a redemption vault; or does not operate with a self-contained fill system that permits the operation of the device solely determined on a fee basis or the amount of revenue generated but does not include a system based on time, number of spins or spin equivalent or other nonrevenue based system, and automatically ceases to operate upon the completion of a pre-determined cycle. A "gambling device" does not include:

(1) A coin-in-the-slot operated mechanical device played for amusement which rewards the player with the right to replay such mechanical device, which device is so constructed or devised as to make such result of the operation thereof depend in part upon the skill of the player and which returns to the player thereof no money, property, or right to receive money or property.

(2) Except as otherwise provided in this subsection (a), a vending machine Vending machines by which full and adequate return is made for the money invested and in which there is no element of chance or hazard.

(3) A crane game. For the purposes of this paragraph (3), a "crane game" is an amusement device involving skill, if it rewards the player exclusively with merchandise contained within the amusement device proper and limited to toys, novelties, and prizes other than currency, each having a wholesale value which is not more than $25.

(4) A redemption machine. For the purposes of this paragraph (4), a "redemption machine" is a single-player or multi-player amusement device involving a game, the object of which is throwing, rolling, bowling, shooting, placing, or propelling a ball or other object that is either physical or computer generated on a display or with lights into, upon, or against a hole or other target that is either physical or computer generated on a display or with lights, or stopping, by physical, mechanical, or electronic means, a moving object that is either physical or computer generated on a display or with lights into, upon, or against a hole or other target that is either physical or computer generated on a display or with lights, provided that all of the following conditions are met:

(A) The outcome of the game is predominantly determined by the skill of the player.

(B) The award of the prize is based solely upon the player's achieving the object of the game or otherwise upon the player's score.

(C) Only merchandise prizes are awarded.

(D) The wholesale value of prizes awarded in lieu of tickets or tokens for single play of the device does not exceed $25.

(E) The redemption value of tickets, tokens, and other representations of value, which may be accumulated by players to redeem prizes of greater value, for a single play of the device does not exceed $25.

(5) Video gaming terminals at a licensed establishment, licensed truck stop establishment, licensed large truck stop establishment, licensed fraternal establishment, or licensed veterans establishment licensed in accordance with the Video Gaming Act.

(a-5) "Internet" means an interactive computer service or system or an information service, system, or access software provider that provides or enables computer access by multiple users to a computer server, and includes, but is not limited to, an information service, system, or access software provider that provides access to a network system commonly known as the Internet, or any comparable system or service and also includes, but is not limited to, a World Wide Web page, newsgroup, message board, mailing list, or chat area on any interactive computer service or system or other online service.

(a-6) "Access" has the meaning ascribed to the term in Section 17-55.

(a-7) "Computer" has the meaning ascribed to the term in Section 17-0.5.

(b) A "lottery" is any scheme or procedure whereby one or more prizes are distributed by chance among persons who have paid or promised consideration for a chance to win such prizes, whether such scheme or procedure is called a lottery, raffle, gift, sale, or some other name, excluding 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).

(c) A "policy game" is any scheme or procedure whereby a person promises or guarantees by any instrument, bill, certificate, writing, token, or other device that any particular number, character, ticket, or certificate shall in the event of any contingency in the nature of a lottery entitle the purchaser or holder to receive money, property, or evidence of debt.

(Source: P.A. 101-31, eff. 6-28-19; 101-87, eff. 1-1-20; 102-558, eff. 8-20-21.)

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