‘High Tax Rate.’ ‘Complicated.’ ‘No Interest.’ Chicago Casino Project Extends RFP Deadline, But Is More Time The Answer?

Editor’s Note: The following expresses the author’s opinions.

The date for game applications in Chicago has been advanced from Aug. 23 to Oct. 29.

Chicago Mayor Lori Lightfoot is allowing potential bidders more time to evaluate the project, she stated.

By extending the deadline for serious bidders, the city aims to gather as many powerful and transformative proposals as possible. I’m excited to see these bids and look forward to working closely with the selected candidate to develop Chicago’s first-ever casino.

Currently, only one bid for the Chicago game project is known, that of Rush Street Gaming, That & RSquo, and S & NBSP. However, awarding the project to Rush Street without any other contenders may result in political problems for Lightfoot.

Neil Bluhm co-founded Rush Street Gaming, and his daughter, Leslie, has donated over $100,000 to Lightfoot’s political campaigns in the past.

Crain’s Chicago Business was informed by Brian Hopkins, Alderman of the 2nd ward:

“I believe that if the mayor accepted a contract that essentially makes it the exclusive source for something so significant, there would be a great deal of opposition.”

Gaming executives from Caesars Entertainment, MGM International, and Wynn Resorts & nbsp will approve the project.

During an earnings call with owners, Tom Reeg, the Director of Caesars, delivered the most recent blow:

“I have no desire to visit Chicago.”

In June, Lightfoot stated that there would be “no hometown favorites” in the issuing of the Chicago casino license.

We’ll counter that cliché with another: Sometimes, beggars can’t be choosers.

Why isn’t the Chicago game registration more well-liked?

Firstly, the effective tax rate is currently quite high at 40%.

Lightfoot deserves credit for reducing the effective tax rate from 72%. One of her most significant legislative victories was when she successfully renegotiated the structure of the casino tax.

Nevertheless, 40% is a striking figure. Bill Hornbucklereferenced, the CEO of MGM, cited the tax rate, among other factors, as a reason why his company is not interested.

“Chicago is simply complex. The city’s history, its taxes, and the concept of a grand-scale integrated resort do not really align.”

Besides the high tax rate, the development of the resort will probably exceed $1 billion in costs.

When you hear the words “complicated” or “the history of Chicago,” it implies a certain unavoidable negative aspect that seems to work against the city.

Chicago is notorious for its chaotic political landscape, which can be aptly described as “messy” – a term that could also describe the undertaking of this project. It has been over two years since Illinois Gov. JB Pritzker enacted the gaming expansion bill, which included the Chicago casino.

So, what has the city achieved after two years? The most positive outcome you can point out is the improvement in the tax rate. However, the location of the Chicago casino, the operator, and numerous other crucial factors are still uncertain.

Just so you know, once Chicago sorts everything out, the Illinois Gaming Board (IGB) isn’t exactly known for promptly approving casino applicants. It’s also unlikely that operators are eager to deal with the IGB.

Even though Chicago is far from ready to submit an application, Lightfoot has previously expressed criticism towards the IGB for their cumbersome process.

What will happen to the Chicago game then?

It is clear that gaming operators are not keen on extending the request for proposal (RFP) deadline. However, Lightfoot’s office seems to believe that the additional time will attract more bidders.

Currently, Rush Street appears to be the clear frontrunner to secure the license and it’s possible that it may not have any competitors.

Nevertheless, there could be a possibility. A source from Chicago Business’s Crain has indicated that there will be at least one more proposal.

Interestingly, Hard Rock International has remained silent on the matter. It was one of the four gaming companies that responded to Chicago’s Request For Information, along with Rush Street, MGM, and Wynn. However, the latter two have since withdrawn from the discussion.

Therefore, it is plausible that Hard Rock needs more time to assess the project. They are also working on developing a casino in Rockford, which is expected to be the next one to open in Illinois.

Residents of Chicago can somehow acquire their game. Although it won’t occur this year, next year, or any other season, it is assured to happen eventually.

However, some people now believe that reaching there will be a challenging task.