MGM Resorts Calls Chicago ‘Complicated,’ Likely To Pass On Casino Bid

According to its chief financial officer Jonathan Halkyard, MGM Resorts International may probably reject the bid for the Chicago game license.

When asked about the possibility during MGM’s first quarter earnings call, Halkyard said:

“Chicago is simply a challenge.”

The historical context of Chicago, its responsibilities, and the concept of a large-scale integrated resort don’t always align. Despite believing that they have made progress, at this specific moment, we are not excessively interested or concentrated on this matter.

The reference to improvement is probably about the tax rates reduction in 2020. However, the tax rates are still steep – revenue between $225 million and $1 billion would be subjected to a tax of nearly 50%.

Moreover, Bill Hornbuckle, the CEO of MGM, clarified that the company is not interested in Chicago, partially due to the complex tax regulations.

MGM seemed interested after reacting to Chicago’s Request for Proposals (RFP). Thus, it’s surprising that they decided not to submit a request.

The president wants Chicago to have Las Vegas.

Recently, Chicago Mayor Lori Lightfoot gave a hint about the type of applicants she is hoping to see for the casino license.

Lightfoot declared:

“We aspire to reach the highest possible level because we want to ensure our Request for Proposal (RFP) appeals to some of the top gaming companies worldwide. While I won’t mention specific brand names, it’s clear that receiving applications from certain companies would be incredibly satisfying for us.”

The information previously mentioned fits with MGM’s situation. Lightfoot is hopeful that more businesses won’t arrive at the same decision as MGM, even though other Las Vegas entertainment giants might likely do so.

It appears to be an opportunity for Wynn Resorts as they have shown interest in it through media.

“We express interest when a major, significant city contemplates on establishing a gaming resort. Chicago is a city that matches this description,” Michael Weaver, a spokesman for Wynn, conveyed to Crain’s Chicago Business.

Lightfoot criticizes the Illinois Gaming Board’s rhythm

It has taken the Illinois Gaming Board (IGB) a long time to evaluate casino license applications, following the 2019 gaming bill that permitted six new casinos in Illinois.

The game areas will be Waukegan, Danville, Rockford, Williamson County, the southern suburbs, and Chicago.

Numerous organizations applied back in October 2019. However, up until the time of this writing, no certificates have been issued.

In February, the IGB gave Hard Rock Casino Rockford a “preliminary suitability” rating for a license, however, nothing has been finalized yet.

Apparently, there still isn’t a game application for Chicago. However, Lightfoot has noticed the slow pace of the IGB.

In late April, Lightfoot conveyed to the Chicago Sun-Times:

“We need to act swiftly after submitting a proposal to IGB. I don’t want to critique it, but I believe the process needs to be expedited due to the lengthy duration the game board requires to fulfill its task.”

Additionally, BetMGM excluded Illinois sports wagering.

Since September, BetMGM has been a pending applicant for sports betting in Illinois.

The decision of Illinois Governor, JB Pritzker, to resume in-person registration has severely impacted certain candidates, including sportsbook operator BetMGM.

It appeared that BetMGM would secure market access via Par-A-Dice Casino and instantly become a contender. Even though BetMGM might still pursue market access with Par-A-Dice, this option seems less attractive now than it was a few months ago.

Is it possible for BetMGM, with its considerable financial resources, to apply for the $20 million mobile-only license that would activate online sports betting registration for all? Despite the steep cost, it could be a viable option for BetMGM.

BetMGM will ultimately join the sports gambling industry in Illinois, regardless of the circumstances.

However, it doesn’t seem like it will be in the casino any time soon.