Despite Mayor Lightfoot’s campaign promise, Chicago’s casino will be owned by a private investor after all | On Culture | Chicago Reader

Despite Mayor Lightfoot’s campaign promise, Chicago’s casino will be owned by a private investor after all 

So much for gambling of the people, by the people, and for the people.

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A funny thing happened on the way to state legislative approval for Chicago's very own casino last week.

For decades political leaders, lusting after the easy money a casino in the nation's third-largest city would bring, have proposed a vision of a very special kind of gambling place, one that would override qualms about sucker traps that transfer cash from some of the poorest and most vulnerable members of the populace to the pockets of fat-cat investors.

The vision those leaders floated took the predatory investors out of the picture, replacing them with something much more beneficent: a casino that would be city owned, with profits entirely dedicated to civic causes.

This kinder, gentler casino concept, with all the money siphoned from the poor-sap customers coming right back to them in city services or a better-balanced city budget, has been around at least since the state legalized riverboat gambling back in 1990. Richard M. Daley was a proponent. So was Rahm Emanuel, although, oddly, neither of these powerful mayors was able to successfully propel it through the governmental obstacle course in Springfield. And reformer Lori Lightfoot campaigned on the idea, telling Crain's Chicago Business (and anyone else who asked) that "if people in Chicago want to gamble, then they should be able to gamble in Chicago at a city-owned, land-based casino."

That's what she'd be seeking in Springfield: a casino of, by, and for the people.

So it came as a surprise when, in the orgiastic last hours of the spring session of the Illinois General Assembly on June 2, legislators approved an 800-page omnibus bill that massively expanded gambling and finally gave Chicago its own casino—and it turned out that the heart of the Chicago casino concept had somehow been gutted.

Like every other casino in Illinois, the huge new Chicago facility, with as many as 4,000 gaming positions, will be owned by private investors.

As explained by the bill's sponsors, the casino profits will be shared equally by the city, the state, and the investor who buys the license. Governor J.B. Pritzker, who's invested in the gaming industry himself, is expected to sign off on it in the next few weeks. So much for civic ownership, dispensable as chips on a roulette wheel.

It was a bait and switch that didn't get much notice.

Mayor Lightfoot told the Sun-Times that a city-owned casino "wasn't going to make its way through the General Assembly," and that the "legislative process is about compromise." And then the public discussion moved on to speculation about which of a half-dozen possible locations would be the chosen casino site, with the odds in favor of the old Michael Reese Hospital site in Bronzeville—never mind the objections of local residents.

In the city that's home to the world's most notorious parking meter deal, the question of how this happened was pretty much left hanging. WTTW, which did ask Governor Pritzker, reported that he said the casino will be privately owned "at the city's request."

So I called Lightfoot's office to ask for an explanation. Deputy communications director Lauren Huffman responded with a written statement that ducked the question but made the point that a casino "will create a new revenue stream and will allow us to shore up underfunded police and fire pensions." She thought maybe I should ask the bill's sponsors.

In the Illinois House, that would be 28th District rep Robert Rita. His answer came from spokesman Ryan Keith, who told me Rita himself had proposed a city- or state-owned casino in the past, but, in this instance, "I think they just decided it was cleanest and simplest to do it the way they do all the other casinos"—that is, with private owners.

Who decided? "The negotiators," Keith said, "representatives from all the different legislative caucuses, the governor's office. The city obviously was involved."

Northeastern Illinois University economics professor Michael Wenz, who studies gambling as an economic development strategy, says that, compared to past Illinois casino deals, the city did well. "A third of AGR [adjusted gross revenue] is a good deal," Wenz told me. "They can do that without having to worry about the costs, without having to worry about anything. And it'll be wildly profitable."

Casino revenue has been flat or even down recently, cannibalized by the spread of video gambling, but Wenz says it's reasonable to expect that a well-located city casino could do three times what Rivers Casino in Des Plaines does in volume. Figures from the Illinois Gaming Board show that Rivers's AGR in 2018 was $441 million.

Someone in Springfield no doubt did the math on that.   v

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