Illinois Gaming is Big Business!

Over $17 Billion was wagered on Video Gaming Terminals in 2019.  See how your business can get in on the action.

The Basics of the Illinois Slot Machine Industry

Sometimes you win, sometimes you lose. In 2019, players wagered over $17 billion on Illinois VGTs and won just over $15 billion. The remaining $2 billion was divided amongst licensed locations, terminal operators, and the State of Illinois.  

Net Terminal Income (NTI) is defined as all monies wagered, minus all monies won. The Video Gaming Act sets the tax rate on NTI at 34%, and mandates that all after-tax profits on NTI be shared equally between licensed locations and terminal operators. An administrative fee of 0.8512% must also be split between licensed locations and terminal operators.

The Slot Machine Industry Terminology

Like any industry, the slot machine industry has its own special terminology, abbreviations, and other shorthand.

Video gaming, video gambling, and video slots. These all refer to exactly the same thing, namely, the slot machine industry itself. The Video Gaming Act calls it video gaming while players often call the machines video slots.

The Terminal Operator (TO) is the licensed party that owns, services, and maintains VGTs and installs them in licensed video gaming locations, which are either licensed retail establishments, truck stops, or veteran and fraternal establishments. All locations must enter into a valid use agreement with a licensed Illinois Terminal Operator.

The Illinois Gaming Board (IGB) is the State regulatory agency that oversees all aspects of gambling. Appointed by the Governor and confirmed by the Senate, its five members oversee all aspects of gambling in the State including licensing. They have a large staff including investigators, attorneys, enforcement agents, and financial and licensing personnel.

The Central Communication System (CCS) is the network that provides for real-time communication among all the licensed slot games in the state.

How to Get Your Illinois Gaming License

Universal Gaming Group will work with you through the process of securing your gaming license. In fact, we’ll provide help even after the Board approves the application. We are a full-service operator, who will provide your location with the best equipment, ensure your location remains in compliance with changing laws and regulations, and assist your location with marketing plans. Step by step, our process looks like this:

obtain your state and local LIQUOR LICENSE

First, we research your municipality to see if it has opted in and gambling is allowed there. Assuming that it is, we look at all the local requirements to make sure you meet them. (You can also check out your area yourself by going to https://www.igb.illinois.gov/)

WORK WITH UGG ON SUBMITTING YOUR IGB APPLICATION

Second, a member of our team will meet with you at your establishment to start the application process for your Illinois gaming license and help you determine the optimal set-up for your slot machines. Everyone whose name is on the application then will need to be fingerprinted by a state-approved fingerprinting vendor.

Prepare for Inspection

Third, we’ll help you prepare for the mandatory inspection by the Illinois Gaming Board and make sure you have all the documents the Board will need to see. (The Board will also need to see exactly where the slot machines will be installed.)

Getting Your Slot Machine Business Ready to Open

Now that you’ve submitted your application, it’s time to think about where you’ll put the slot games and associated materials. This is important partly because you need to meet legal requirements and partly because casino slots that aren’t well placed don’t generate as much revenue as ones that are. Spaces between machines, phone chargers, purse hooks, and bins for cash out vouchers aren’t absolutely required but paying attention to them will likely pay off in additional proceeds. Here are key things to consider that are required however:

Signage

This is one of the matters covered by legal requirement. Signs displaying the age requirement must be visible.

Electricity

Dedicated electricity is required to run VGTs and is generally provided in part or full by the Terminal Operator.

Staff

Staff who are over 21 years of age need a clear line of sight from the front door to the entrance of the slot machine area.

Stanchions

Used to set off the gambling area, and are required if people under 21 are allowed in other parts of your establishment.

Personnel Needed for Your Illinois Slot Machine Business

Hire personnel carefully as they’re critical to your success. One absolutely key position is that of the video gaming manager, whom you’ll need to name in the course of filling out your license application. He or she will work with your TO, take care of license renewals and may well also be in charge of promotions, customer engagement, social media, and marketing.

When choosing and training staff members, bear in mind that they’ll need to card potential customers since gambling is strictly for customers who are 21 or older. They should know what to do and who to call if a slot machine malfunctions or there’s a problem with a cash out voucher. They should have a general familiarity with the slot machine industry and the outside people you work with and be absolutely discrete when dealing with patrons’ financial matters.

How long does it take to open your slot business?

After reading all the above, you may be wondering just how long it takes to get a slot machine business open. Sadly, it’s not a process you can start today and finish tomorrow. After you submit your application, the licensing process takes 2-3 months on average but can take significantly longer.

You can prevent delays by working with your TO to make sure all paperwork is completed properly, making sure all necessary licenses (like the on-premises liquor license, for example) are current, getting all the necessary signage posted, and promptly paying the IGB licensing fees and any additional required Municipal charges.

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