Bailey's filing shows temporary casino losing company money

The venture is expected to bring the city roughly $74 million in tax revenue annually once the $1.7 billion permanent casino project and associated amenities like a hotel are completed, but some development has hit a snag.

Last week, Bally’s Chicago announced it would pause construction on facilities aside from the permanent casino following a dispute between the company and the Chicago City Council over what they called in a statement “an uncontrolled proliferation of video gambling terminals is in breach of the City's commitment not to expand gaming.”

Bally’s Chicago hired the law firm of former Mayor Lori Lightfoot, who originally signed the deal between the city and company, amid threats the company would sue the city for a violation of its “host city agreement” by legalizing video gaming terminals at establishments around the city.

Alderman Jason Ervin previously said the legalization of VGTs is insignificant when compared to the revenue generated by the casino.

“Bringing one of those slot machines in O'Hare or somewhere else outside of Bally's gives us greater revenue opportunities,” Ervin said. “If we're talking about budget, that is going to help us meet our budget while not having to proliferate gambling in all 50 wards.”

In a letter to the company last week, aldermen urged the company to return to development immediately, claiming Bally’s is the one in violation of the agreement.

“VGTs have been authorized, but they are not operating throughout Chicago and have not produced the adverse impact contemplated by the agreement. Nothing in Section 4.1 says that authorization alone permits Bally’s to slow construction of the hotel or other non-gaming portions of the development,” read the letter signed by 28 aldermen.

Ervin didn’t sign the coalition’s letter.

A statement from the company following the filing asserted its financial position had no impact in its decision to slow and reassess development around the casino.

Ivan Capifali, commissioner of the Chicago Department of Business Affairs and Consumer Protection, said a VGT program in the city could cost more than the revenue it brings in.

“The challenges associated with implementing this ordinance have been substantial,” Capfali said during a council committee meeting in June. “BACP believes that we should carefully consider whether the cost, administrative burdens, limitations on local regular regulatory authority and operational impacts associated with this program outweigh its anticipated benefits.”