IGB Meeting Update: June 2024

The following notes are from the June 6^th IGB meeting. Any charges and accusations included in this meeting summary are simply alleged at this point. Any disciplinary complaints herein are not final as individuals/entities have the right to appeal the Board’s decisions; they may be dismissed, settled, or otherwise disposed of in some manner at a future date.

Introductory Comments

The IGB held its June meeting this morning.  All four Board members were present, with Member Kolar attending via electronic means. 

Administrator Marcus Fruchter announced that a Request for Proposals (“RFP”) relating to the Central Communication System (“CCS”) for VGTs was posted on the Illinois procurement website this morning.  The CCS is currently operated by Light and Wonder under a bridge contract that followed the original 10-year agreement.  Illinois is seeking bids from vendors to operate the CCS after the current bridge contract expires. 

Administrator Fruchter also provided a legislative update from the most recent session, which included a reminder about the 1% tax increase under the Video Gaming Act.  Please review the previously provided information on the July 1^st tax increase and email GR@AccelEntertainment.com with any questions.  

A summary of Illinois’ gaming world is as follows:  15 casinos; 14 sportsbooks (with 13 operating); 61 Terminal Operators; 8,628 Licensed Establishments (with 6,209 operating more than 5 VGTs on site); and 48,199 VGTs (with 47,855 operating with the updated max bet software).  In April, VGTs generated NTI of $257,314,667, which produced total tax of $87,486,939.  The State kept $74,625,588 and municipalities received $12,861,351.  Illinois’ casinos generated AGR of $136,997,283, which produced total tax of $31,523,261.  The State retained $23,210,030, while locals received $8,313,231.  In March, sports wagering produced AGR of $99,420,016, which created tax of $16,006,616.  The State received $14,913,002, while Cook County took $1,093,614. 

Public Commentary:

The IGB entertained two public speakers this morning, both via video.  The first was Tim Jones, the owner of Midwest Electronics Gaming. 

Next up was Laurie Taylor.  She had concerns with the distance restrictions for Licensed Establishments near residential units.  Administrator Fruchter responded to clarify that these restrictions are set by statute and are outside of the IGB’s jurisdiction to adjust them. 

Proposed Rules

The IGB adopted two proposed rules today that impact the VGT industry.  First, the IGB adopted new proposed Rule 156, which would authorize the Administrator to issue “No Action” letters under certain circumstances.  If enacted, it will provide a process for licensees to seek the Administrator’s opinion on statute or rule interpretation, including whether a certain action could subject them to discipline.  It will provide for a fact specific, non-precedential advisory opinion process.  The proposed rule is based on procedures from the SEC and the Department of Revenue.  It will permit licensees to make 1 request per 12-month period, although the Administrator will not be obligated to respond.  Administrator Fruchter mentioned that the No Action rule has the following three tenets: (1) transparency; (2) focus; and (3) efficiency.  The proposed rule will require certain information or topics to be covered by the requesting party, including the rule in question, names of the licensees, statement of facts, relevant documents, clarification as to why a question exists, and whether there is any adverse authority. 

The other proposed rule seeks to amend the definition of VGT in Rule 110 so that it matches the definition in the Video Gaming Act. 

Licensing:

The IGB issued a new Terminal Operator license to Lakeshore Gaming LLC and approved 27 new Terminal Handlers today.  Further, it approved 82 new Establishments, but voted to issue Notices of Denial to: (1) CTAM Inc., d/b/a Mo’s Coffee & Café’ (2) Red Top Barbecue & Chili, LLC; and (3) Ruckers Sports Lounge LLC.  Administrator Fruchter also used his delegation of authority to deny Dream Event Space Banquet Hall LLC as being statutorily ineligible to hold an Establishment license. 

The Board voted to rescind the April non-renewal of YMPV, Inc., d/b/a Crave Bar & Food Joynt and renewed that license for two years.  It also rescinded the April denial of Fairview BP Inc., d/b/a Sav-On Liquor & Wine #9 and granted the applicant an Establishment license. 

Economic Disassociation:

The IGB ordered Midwest Electronics Gaming to disassociate from Arthur Coy Hutchcraft, one of its Sales Agents, based on the fingerprint report. 

Rule 320 Final Board Orders:

In Accel Entertainment Gaming, LLC v. Midwest Electronics Gaming, LLC (19-UP-019), which also involved Katy T’s Pub, the Board issued a final Order that (1) declined to address arguments and allegations in the parties’ exceptions that go beyond the scope of Rule 320; (2) adopts the Administrator’s recommended decision; and (3) dismisses Accel’s petition.

Similarly, in Accel Entertainment Gaming, LLC v. Midwest Electronics Gaming, LLC (19-UP-006), which also involved Lucky Dog’s Pub & Eatery, the Board issued a final Order that (1) declined to address arguments and allegations in the parties’ exceptions that go beyond the scope of Rule 320; (2) adopts the Administrator’s recommended decision; and (3) dismisses Accel’s petition.

IGB’s next regularly scheduled meeting is July 25^th.