State Lawmakers Take Aim at Chicago Sports Betting Changes

A showdown over sports betting is unfolding in the Land of Lincoln.

A pair of Illinois lawmakers has set Chicago in their sights over its controversial new sports betting regulations. The city now requires online sportsbooks to obtain Chicago-specific licenses and pay a 10.25% tax, despite warnings from the state and the Sports Betting Alliance (SBA). 

In the state House, Rep. Dan Didech proposed HB 4171. The proposal would update the state’s betting law to make it clear that the state has full authority over regulated sports betting. This would end Chicago’s ability to enact its own regulations and taxation over sports betting, reversing the changes approved in its 2026 budget.

In the other chamber, Sen. Patrick Joyce announced his plans to introduce a bill targeting Chicago’s tax revenue. The Windy City currently receives tax revenue from the state’s sports betting market, but this bill would end that practice. The money set aside for the city would instead be split between other cities or counties in Illinois.

The state legislature will be back in session on January 14. 

SBA Gives Up Fight to Delay Chicago Changes

The news this week isn’t all bad for Chicago.

The Sports Betting Alliance announced it is dropping its motion for a restraining order against the city’s new regulations. The lobby group, whose membership includes bet365, BetMGM, DraftKings, Fanatics, and FanDuel, had been hoping to buy time for sportsbooks to acquire the new city licenses. Chicago has already awarded them, eliminating the need for the delay. 

While the fight to delay the new changes is over, the SBA has promised it will continue to fight their legality. 

“We’re pleased to see the city moved quickly yesterday to maintain the operations of legal platforms that provide customer protections not available in the illegal market,” the SBA shared in a statement regarding its decision. “Given these developments, there was no longer any need for an expedited TRO. The SBA will nevertheless continue to pursue in court resolution of the invalidity and unconstitutionality of the City’s recently passed license and tax ordinances.”