Happy holidays to you and your friends and families!

On Oct. 14, 2022, Gov. Pritzker issued a statewide disaster proclamation in response to COVID-19. In response, the Illinois Gaming Board determined it is not practical or prudent, nor is it feasible, to hold an exclusively in person meeting.

As such, the IGB’s monthly meeting on Thursday, Dec.8, 2022 was hybrid with in-person accessibility at 555 W. Monroe Street, First Floor Conference Room and via livestream. It is unclear what 2023 will have in store for these meetings, but we will keep you posted if we hear of changing to the hybrid model.

Speaking of 2023, the IGB previously posted their 2023 meeting dates on the IGB’s website. For your convenience, we have included the dates here:

• Thursday, February 09, 2023
• Thursday, March 16, 2023
• Thursday, April 27, 2023
• Thursday, June 15, 2023
• Thursday, July 27, 2023
• Thursday, September 14, 2023
• Thursday, October 26, 2023
• Thursday, December 07, 2023.

Board members present at the December meeting included Chairman Schmadeke, Member Hayden and Member Garcia.

The meeting began with the approval of the Regular Board Meeting Minutes from October 27, 2022 and continued with the Administrator’s comments as there were no comments from Board Members.

Administrator Comments

During his comments, the Administrator stated that he would keep his comments brief because there was a full agenda. In doing so, he reiterated the 2023 meeting schedule (as listed above) and provided a recap of the Online Master Sports Wagering supplemental license application period as discussed at the last meeting.

Next, the Administrator provided his revenue report. He stated that currently, there are 44,955 live VGTs in 8,225 licensed locations across the state. According to the Administrator’s report, the November NTI for video gaming locations was approximately $224 million which generated $65 million in tax revenue for the state and $11 million for the local municipalities.

The Administrator also provided a summary of revenue generated by the entire gaming industry, January through October (with the exception of the unavailable October Sports Wagering amounts). In total, gaming activities have generated approximately $900 million in tax revenue for the state and $181 million in taxes for local host communities since January for a total of over $1.13 billion in taxable revenue with over $950 million going to the state.

Public Commentary

While John Gnutek was listed on the agenda to address the Board during the Public Commentary section, he was not present at the meeting, nor was he available virtually.

Administrative Matters

During his comments regarding administrative matters, Mr. Fruchter covered a number of topics. It should be noted that while Closed Session Minutes Review for Confidentiality or Dissemination was listed on the agenda, it was not discussed and no action was taken.

• Petition for Hearing: The first Administrative Matter was regarding a petition for a hearing based on a denial of an individual’s request to be removed from the self-exclusion list. Limited information was provided to protect the confidentiality of the petitioner. However, the Administrator did say that the petition for hearing did not meet a prima facia case, and therefore the request was denied.

• Proposed Rules and Amendments to Existing Rules from Casino and Video Gaming regulations:

In his comments, the Administrator stated that the rules and regulations for the casino and video gaming industries have not kept pace with available technology or modernization. As such, the Administrator and staff have begun a comprehensive review of rules and regulations in an effort to advance the Illinois market. This matter was initially introduced over the summer, and these are not the first, nor the last amendments/new rules we are expecting.

We would like to preface the summary below by stating that the IGB approved all of these being submitted to the Index Department of the Secretary of State. However, these are proposed changes and will go through the standard rule making procedure, including First Notice (public comment) and then Second Notice with the Joint Committee of Administrative Rules (JCAR) review and consideration of the rules. As you know, there are multiple opportunities for submission of public comments and we encourage your input and participation.

It should also be noted that these items were discussed briefly at the meeting and the following is based off our notes of the Administrator’s comments. That said, we want to be careful to confirm all these details and will request drafts of the rules for further analysis.

• Proposed Casino Rule 3000.560 Regarding Magnetometers:
  • This new rule stands to create a duty to prohibit unsuitable individuals from entering the gaming floor and requiring the use of magnetometers (commonly known as metal detectors) at entry to prevent unauthorized weapons in the casino.
• Proposed Amendments to Section 3000 – Casino Admissions, Surveillance, Gaming Positions, Electromechanical Devices:
  • Rule 606 (Section 3000 (ilga.gov)) - Update gaming positions for electronic gaming devices (egd) due to new stadium-style egds. Positions will be counted based on how many can play at an each egd.
  • Rule 665 (Section 3000 (ilga.gov)) - Removal of this rule as it addresses concerns regarding security measures that have already been mitigated by advancements in the industry.
  • Rule 800 (Section 3000 (ilga.gov)) and Rule 840 (Section 3000 (ilga.gov)) – Advancements and improvements to surveillance equipment standards and permitting remote access.

• Proposed Video Gaming Rules and Amendments to Section 1800 Regarding Vertical Integration:
  • Proposed Amendments to Section 30 of VGA and 1800.430
    • Section 30 230 ILCS 40/ Video Gaming Act. (ilga.gov) – Prohibits vertical integration, prohibiting individuals from holding more than one type of license. Because of this statutory prohibition, the IGB needs to adopt rules to further regulate this. The Administrator stated that the goal is to adopt clear rules to prohibit certain “troubling” arrangements and relationships. This requires a robust and deliberate consideration of the rules and the intention of the Video Gaming Act.
    • Rule 430 - The proposed amendments would add franchisers to the definition of Persons of Significant Influence or Control (PSIC).
  • Proposed Video Gaming Rule 1800.322 and Rule 450
    • Rule 322 – This rule would prohibit use agreements between terminal operators and establishments when PSICs of the TO are immediate family members to the owner of the establishment, prohibit sales agents for a TO from entering into use agreements when the location is an immediate family member. This rule would also prohibit a landlord from being the terminal operator of a licensed location.
    • Rule 450 – All individuals can only be licensed in one tier of the industry.

The Administrator stated that there will be a grace period to allow individuals to comply. Those of you who have been in the industry for many years may remember that previous administrations introduced similar sounding rules that were not approved by JCAR. We, like you, are very interested in how these proposals will progress through the rule making procedures. Please reach out to us with your questions, comments and concerns. As soon as we get the actual draft rules we will forward.

Casino

The Casino portion of the meeting began with the Board’s approval of the final consideration of the ownership license renewal of HC Aurora, LLC d/b/a Hollywood Casino Aurora.

The meeting continued with the Administrator issuing a Casino Supplier license renewal to Incredible Technologies, Inc.

The meeting continued with the Board approving 68 Level 2 occupational licenses, and 91 Level 3 occupational licenses.

Next, the Administrator issued renewals to the occupational licensees that were up for renewal and had provided updated information, timely paid their renewal fees, and complied with all other requirements.

Sports Wagering

The Sports Wagering section of the meeting began with the Board approving the occupational applications of 140 Level 2 applicants and one Level 3 applicant. The Administrator then granted renewals to the Level 1, 2 and 3 licensees that were up for renewal, had provided updated information to the IGB, timely paid their renewal fees, and complied with all other requirements.

Video Gaming

The Administrator began the Video Gaming session, as he has the past meetings, by reiterating that the licenses for establishments, handlers and technicians now have a term of two (2) years, while suppliers, distributors, manufacturers and terminal operator licenses now have a term of four (4) years and that though new license terms would begin today, annual fees are still due. He also reminded licensees that, due to technical difficulties including auto-generated notices and programming and system enhancements, licensees may receive letters or notices with one-year expiration dates, adding that IGB will be providing updates on the Sci Games portal and to please make notes of any discrepancies.

The Administrator then granted manufacturer, supplier and distributor licenses to Everi Games, Inc. and supplier and distributor licenses to Everi Payments Inc. While these companies are new to video gaming, these entities hold casino-related licenses. Therefore, the video gaming license applications fall under the authority delegated to the Administrator.

Following this, the Administrator renewed the license of the following supplier and terminal operators for a period of four (4) years:

• Illinois Rewards, Inc. d/b/a Rewards Suites
• Angelle & Green Gaming LLC
• CCFVG, Inc. d/b/a Best Gaming
• Dearborn Gaming, LLC
• Empire Gaming, LLC
• Illinois Gaming Entertainment LLC d/b/a Illinois Gaming Entertainment
• Kronos Gaming LLC
• National Gaming Operators LLC
• 777 Gaming, LLC
• Jackpot Video Gaming Inc. d/b/a Jackpot Video Gaming Inc.
• LS Gaming LLC
• Sunrise Gaming, LLC d/b/a Better Gaming Group

Next, the Administrator renewed the terminal handler, technician and location licensees which were up for renewal and had provided updated information to the IGB, timely paid their renewal fees, and complied with all other requirements. He also issued a notice of nonrenewal to Sunrise Motel Enterprises, Inc. d/b/a Manny’s after the location allegedly failed to pay a $5,000 fine associated with a previous disciplinary complaint.

The meeting continued with initial licenses being issued to two terminal technicians, 44 terminal handlers and 82 video gaming locations.

The Board then denied the applications of two locations, Cajun Blue, LLC d/b/a Bluefish Café andGloria’s Family Affairs LLC d/b/a The Duo Like Mother Like Daughter.

The Administrator then discussed a new category as listed on the agenda, Video Gaming Rescission Items. These are applicants that previously were denied initial licenses or renewals but have since gone through the administrative process and entered into settlement agreements with the Administrator (as allowed by the authority delegated to him). The granting of licenses, however, still requires Board action. As such, the following entities were previously denied licenses but have since entered into settlement agreements and the Board granted initial licenses:

• Gaming Productions, LLC (Terminal Operator)
• DB Jackpot, LLC d/b/a DB Jackpot, LLC (Establishment)
• Pana Gaming Parlor Inc/ d/b/a Pana Gaming Parlor (Establishment)
• Livingston Gas & Grocery Inc. d/b/a Livingston Shell (Establishment)
• GPM Midwest 18, LLC d/b/a Fas Mart #561 (Establishment)
• Sofia’s Stefanis, Inc. d/b/a Sofias Stefanis Bar & Grill (Establishment)
• A.A.A.M &V, Inc. d/b/a Bago Lounge – Wine and Slots (Establishment)

The last matter of the day pertained to In re: the Denial of 170501204 O & S Alkabsh Enterprises, Inc. d/b/a Krispy Krunchy Chicken (O&S). According to the Administrator, O&S allegedly abandoned prosecution of its case and the Administrative Law Judge (ALJ) ordered a default judgement in favor of the IGB. The Board then voted to adopt the ALJ decision as final board order.

The meeting was then concluded with a final note that the next meeting is Feb. 9, 2023 and a wish of Happy Holidays and a Happy New Year from the Administrator and Chairman.

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