CHICAGO — The owners of the city’s major sports teams have cleared a big hurdle to bringing on-site betting to their stadiums, sending the long-stalled proposal to City Council for a vote as soon as this week.
A joint City Council committee approved an ordinance Monday to allow sportsbooks at or near Wrigley Field, Soldier Field, Wintrust Arena, Guaranteed Rate Field and the United Center. The ordinance, introduced by Ald. Walter Burnett (27th) over the summer, has been held up several times because of pushback from a potential operator of a city casino, then by alderpeople who questioned the tax revenue sportsbooks would generate.
Chicago Cubs co-owner Tom Ricketts, Chicago Blackhawks owner Rocky Wirtz, and Chicago Bulls and Chicago White Sox owner Jerry Reinsdorf all called into a virtual meeting to urge support for the ordinance, largely playing up their community work to argue they deserve a chance to benefit from legalized sports betting.
Ricketts told the committee the proposal will “create hundreds of jobs, millions of dollars in tax revenue and provide additional resources to the city’s professional sports teams that will help them compete.”
The ordinance moved forward by a 19-7 vote. The full City Council is likely to consider the measure Wednesday.
Under the ordinance, sports betting would be allowed at facilities inside or near the city’s stadiums, or in buildings within five blocks of them. Sports betting would also be permitted at the future Chicago casino.
The sports teams would pay an initial $50,000 license fee and $25,000 in subsequent years. Betting would be limited to the hours of 10 a.m.-midnight Monday-Thursday, 9 a.m.-midnight Fridays and 9 a.m.-1 a.m. Saturday-Sunday.
The ordinance, supported by Mayor Lori Lightfoot, has twice been changed to gather enough support to advance to the full City Council.
A 2 percent tax on gross wagering revenue was added. That mirrors Cook County’s tax on sports wagering and adds to the 15 percent tax rate flowing to the state, bringing the total tax on gambling revenues to 19 percent.
The 2 percent tax “strikes the right balance” and would net the city $400,000-$500,000 per year, Connor Brashear, of the city’s Budget Department, told alderpeople at a meeting last week.
But several alderpeople said a 2 percent tax was not enough. With that figure unchanged, Alds. Pat Dowell (3rd), Anthony Beale (9th), Raymond Lopez (15th), Stephanie Coleman (16th), David Moore (17th), Brendan Reilly (42nd) and Michele Smith (43rd) all voted no.
“I just think $400,000 to $500,000 a year to the city of Chicago is, you know, really paltry,” Dowell said last week. “Even when you add in the licensing fee that these guys are going to have to pay, it seems like peanuts for an industry that is growing.”
Another amendment includes an “aspirational” goal for the owners of a sportsbook license to subcontract with minority-and-women-owned businesses, but it is not enforceable.
Billionaire Neal Bluhm, whose Rush Street Gaming is behind two bids to operate the Chicago casino, has argued sports betting would cut into casino revenue and the hefty casino tax dollars the city is relying on to shore up its police and fire department pensions. Lightfoot and her administration have disputed those claims.
Bluhm also criticized the city’s tax, saying it “generates virtually nothing for the city.”
Allowing sportsbooks could “potentially make the new casino less successful,” he said. “Why take a chance like this? There’s a big risk with no reward.”
Team owners criticized Bluhm’s opposition, noting that a representative from Bally’s, which also has two bids to operate the casino, said Monday they had no objection to the ordinance.
“Now one person is asking the city, especially city taxpayers to forfeit those revenues and jobs in the chance he might operate a casino” Wirtz said. “Meanwhile his competitor Bally’s, a much larger gaming company, has no problem with sportsbooks.”
“What is perplexing is that Neal Bluhm, who does not want our buildings to have sportsbooks, met with us on several occasions seeking to operate sportsbooks in our buildings,” Reinsdorf said. “It makes me wonder, if he had gotten his way back then, would we be having this meeting today.”
Jennie Huang Bennett, the city’s chief financial officer, helped persuade the committee to approve the measure.
“If you go to a Cubs game, and you weren’t going to go to a casino, but you happen to place a bet because you’re at the stadium in person, that’s a new source of revenue and economic value for the city,” Huang Bennett said. “People deserve to be able to go into a stadium and hear people cheering while they’re sitting there betting.”
After the ordinance was introduced, the Cubs announced a partnership with Draft Kings to build a sportsbook at Wrigley Field. If the proposal is approved by the full City Council, “construction would begin immediately with the aim of opening a restaurant with a sportsbook in time for the 2023 season,” Ricketts said.
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December 13, 2021 at 07:17PM