Beale pushes game plan to expedite a Chicago casino

The South Side alderman is urging Mayor Lori Lightfoot to issue a ‘request-for-proposals’ to identify a ‘responsible’ casino operator, then go to Springfield with that operator to seek a specific fix for the Chicago casino’s tax structure.

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Ald. Anthony Beale (9th) has an idea that he hopes will expedite a Chicago casino stuck in the mud.

Ald. Anthony Beale (9th) is on the outs with Mayor Lori Lightfoot, but has an idea that he hopes will expedite a Chicago casino stuck in the mud.

Rich Hein/Sun-Times

Ald. Anthony Beale (9th) is in the doghouse with Mayor Lori Lightfoot for publicly opposing the mayor’s choice of Ald. Scott Waguespack (32nd) as Finance Committee chairman.

But Beale is not about to keep quiet while Chicago continues to “hemorrhage” revenue to Indiana casinos.

On Wednesday, Beale sent a letter to the mayor outlining a game plan he believes would expedite a Chicago casino.

It calls for the city to issue a “request-for-proposals” to identify a “responsible” casino operator. The mayor and the chosen operator then would go to Springfield to seek the specific fix needed for the Chicago casino’s tax structure. The structure outlined in the current law is so onerous, a city casino can’t be financed, according to a Gaming Board consultant.

“The formula that was approved was the same formula Mayor Daley rejected. It was the same formula Rahm Emanuel rejected. We knew that formula did not work. It should have never been approved,” Beale said Wednesday.

“We have already lost ... close to a year because of the process. ... If you pick a responsible operator and say, ‘This is the formula we need to make this thing work,’ [that’s better than] saying, ‘Change the formula,’ then coming back and the formula you chose may not work again.”

Beale claims to have a “shovel-ready” casino site at 103rd and Woodlawn that has attracted interest from two casino operators he refused to name; that site was not among the five Lightfoot asked the Gaming Board to study.

His letter to the mayor appears to be worded in a way that would give his long-shot site a fighting chance.

“Where a casino is located should not be left to guesswork or favoritism. The successful location will be one where a viable operator decides there is sufficient land where they can operate successfully — guaranteeing a profit both to themselves and the city,” he wrote, arguing that jobs and “ancillary amenities” created should be among the selection criteria.

“I suggest that the city ... solicit proposals from various operators and sites for a Chicago casino to be reviewed and sent forward to the Gaming Board by a panel of reviewers appointed by you and the City Council. ... Each proposal would outline a site, the benefits and challenges, projected jobs and dollars and include what changes, if any, need to be made in the authorizing state legislation.”

Waguespack shot down Beale’s idea as ass-backwards.

“I don’t think you can pick an operator first. That would … exclude anybody else who might have an agreement that could be negotiated ... and tank any potential operator’s funding mechanism,” Waguespack said.  

“The mayor has to fight for what’s better for Chicago, work with Springfield, then do the RFP. Otherwise, we’re setting ourselves up for failure. Picking one person right off the bat without knowing where that location is and what Springfield is gonna do would backfire. I don’t think you can do business that way.”

In a highly anticipated report in mid-August, a gaming board consultant concluded that financing for any one of five casino sites Lightfoot asked the Gaming Board to study on the South and West sides is “not feasible,” because of an “onerous” tax structure established by the Illinois General Assembly.

That set the stage for a gambling fix during the fall veto session.

Union Gaming Analytics also concluded “only a centrally-located casino that is in close proximity to high-quality hotels and other notable tourist attractions” would “meaningfully penetrate the robust tourism trends” in Chicago.

Such a “tourist-centric” location could rack up $1.15 billion annually five years after launch.

A downtown site has always made the most financial sense, since the goal is to raise as much money as possible to fund police and fire pensions and help cover a city budget shortfall Lightfoot has pegged at $838 million.

Samir Mayekar, deputy mayor for economic and neighborhood development, said then that City Hall had no plans to recommend a specific remedy for the “onerous” tax structure and would “respect the process” by waiting for the Gaming Board to make specific recommendations.

Now that the Gaming Board has punted on a fix, the mayor’s office is believed to be working on a specific structure with state Sen. Terry Link (D-Vernon Hills) and state Rep. Robert Rita (D-Blue Island), Springfield’s prime movers on the gambling issue.

The mayor’s office responded to Beale’s proposal, essentially by ignoring it and focusing on getting a gambling tax fix during the fall veto session.

“The State and City benefit from a casino by capturing revenue that goes across the border to Indiana. The State needs this for its capital plan. The City needs it for the police and fire pensions,” mayoral press secretary Anel Ruiz said in a statement.

“We believe that, by getting the tax structure right, we will make a casino viable and generate thousands of jobs and new economic opportunity. The City continues to engage with our legislative leaders in Springfield to revise the legislation.”

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