Online Horse Betting Takes Shape In Illinois

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CHICAGO - Associated Press - The Illinois Racing Board on Tuesday issued the state's first licenses to companies to take horse racing bets online, a move officials say could bring in more than $1.7 million in additional tax revenue for the state.

The board voted unanimously to license three California companies to take electronic bets from Illinois residents through computers, phones, interactive televisions and other mobile devices. State officials said the law will enable them to collect taxes on about $100 million in unauthorized online horse wagers each year in Illinois.

At least one company, Los Angeles-based TVG Network, said it would be operating in Illinois later Tuesday.

"We think it's a great step for horsemen and the tracks," said Frank Kirby, president of the Illinois Thoroughbred Horsemen's Association.

Racing Board executive director Marc Laino projected that such betting could become a $100 million to $150 million industry in Illinois in 2010, generating between $1.7 million and $2.25 million in new taxes.

The added revenue will go into a horse racing fund, which Laino said pays operating costs for the state Racing Board, which regulates horse racing in the state. Laino said fund is projected to operate at a deficit next year, including any revenue from the new online wagering tax.

"We're hopeful it will help close the funding gap," Laino said.

Gov. Pat Quinn signed legislation allowing online horse betting in August. Before the legislation, Laino said the board estimated about $100 million in unauthorized online horse wagers were made annually in Illinois. The new law allows for random account audits and broad oversight of online horse betting, Laino said.

Republican state Sen. Chris Lauzen of Aurora said he voted against that legislation because he doesn't want to see any expansion of gambling in Illinois.

"We ought to be concentrating on jobs," Lauzen said, instead of "expanding methods where odds are known to be against the citizen."

Racing Board commissioner Dennis Bookshester said he thinks allowing online horse betting would be good for the industry in Illinois and draw young people to horse racing.

"This is an opportunity for us to increase the amount of interest in our sport," Bookshester said. "This is a great, giant step."

Besides TVG Network, a digital cable network that specializes in horse racing, the other companies approved for licenses include Woodland Hills, Calif.-based Youbet.com and Mountain View, Calif.-based TwinSpires.com, run by Churchill Downs Inc.

TVG Network representative John Hindman said the company plans a "significant" statewide marketing campaign in Illinois, including advertisements on billboards, radio, taxis and buses.

"We obviously have very high hopes," Hindman said. "We put a lot of resources behind this."

Rohit Thukral, president of TwinSpires.com, said his company was "looking forward to providing Illinois residents the flexibility of wagering online, over the phone or on our offline channels, including the race track and the off-track betting locations in the region."

The governor signed legislation in July that approved video gambling as part of a funding package to pay for a $31 billion public works program. That legislation allows video gambling machines at bars and restaurants, fraternal and veterans groups and truck stops.

It could be a year before the state has all the rules and procedures in place so that legalized video gambling can begin.

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