Sports Betting Alliance (SBA) warned Chicago officials about the proposed online sports betting market plan. This plan could disrupt legal operations. Revenue might drop for public funds. Regulatory confusion will happen if implemented as written.

An industry group sent a letter to Mayor Brandon Johnson’s office last week. SBA asked the city to delay the enforcement of the proposed municipal licensing and tax framework. They want complete structure reconsideration.

The letter came after a meeting between the mayor’s office representatives, the Department of Business Affairs and Consumer Protection, and SBA.

Alliance said the city’s proposed budget and revenue ordinance creates a new city-level licensing requirement. Online sports wagering operators must get this license starting in January.

Chicago plans a 10.25% tax on online sportsbook revenues. No established city-specific licensing framework exists for digital wagering businesses.

The ordinance lacks defined terms, according to the alliance. Application standards are missing. Documentation requirements are not specified. Administrative procedures are absent. Operators cannot comply when the effective date arrives.

The group pushed the city to delay implementation by a minimum of 180 days. This allows time for rulemaking, application preparation, and license issuance before enforcement starts.

Online sports betting operators face extensive state oversight in Illinois already. Legal operation requires all necessary licenses.

SBA hired former American Gaming Association SVP of Strategic Communications Joe Maloney as the new CEO this month. Alliance warned that enforcing the city requirement without a functioning application process forces operators to suspend Chicago services.

A shutdown would undermine the city’s revenue goals even if temporary. Consumers move toward unregulated platforms that avoid age verification, consumer protection, and responsible gaming safeguards.

State Revenue Faces Danger

The letter warned that a Chicago disruption could risk tens of millions of dollars in state revenue. This revenue connects to regulated online wagering.

Alliance requested a delayed implementation but opposes the ordinance in its current form.

City leaders should work with the gaming industry on lasting revenue solutions. Possible state law amendments could preserve regulatory integrity.

The dispute attracted attention beyond City Hall. Illinois lawmakers publicly condemned the proposal.

The city’s plan creates an excessive burden, according to lawmakers. This could set a precedent for other municipalities to tax betting operators and a broad range of goods and services in the state’s largest city.

29 legislators out of 117 signed a letter objecting to the measure.

Opposition emerges as Illinois increased sports betting taxes twice in two years. The state moved to a tiered system capped at 40% in 2024. Per-wager tax took effect this past July.

SBA claims per-bet tax caused a 15% year-on-year decline in online wagering during September. This data shows that additional local taxes could worsen the already difficult market environment.