Don’t leave taxpayers holding the bag for a Chicago casino

Chicago Mayor Lori Lightfoot and her staff at City Hall are weighing five proposals for the city’s first-ever casino, with an eye toward the first quarter of 2022 to present a final proposal to aldermen.

Enabled by the 2019 gaming bill, selecting a finalist from the spectacular-sounding pitches is considered one of the most consequential decisions Lightfoot will face as mayor.

But as she and other city leaders wade through the promises of prosperity, they must remember the purpose of this momentous opportunity is revenue for state and local governments. They should immediately eliminate from contention any proposals that depend on corporate welfare schemes.

Right now, only one proposal seems to fits this bill: Hard Rock International.

That Hard Rock submitted a proposal for a Chicago casino at all is curious on its surface. The company opened the Hard Rock Northern Indiana casino in May in nearby Gary, and another Hard Rock casino is under construction in Rockford. Why would the company want to compete with itself by building a third casino in Chicago?

The answer is buried in the company’s statement that “Hard Rock International is excited to participate in the RFP process to bring our unique brand of world-class entertainment to the city of Chicago at One Central.”

A trigger for a massive taxpayer subsidy

One Central is developer Bob Dunn’s pipe dream for using 34 acres of valuable Chicago real estate west of Soldier Field for a mega mixed-use project. His dream, however, requires $6.5 billion in state subsidies to come true. If this amount of taxpayer money were ever realized, it would be the biggest corporate welfare scheme in U.S. history, and exceed the total cost of all taxpayer-subsidized projects in the state’s modern history.

Dunn himself laid the groundwork for such a potential payout in 2019 with an 11th-hour push to add special language to an Illinois spending bill that authorized the state to negotiate with his privately owned Landmark Development, as well as the unprecedented state spending.

There’s since been little action on Dunn’s proposal, however, so it’s no surprise that his firm partnered with Hard Rock on the proposal, promising that the casino would anchor the project. If Lightfoot were to select Hard Rock, it could trigger the massive taxpayer-funded subsidy needed to build One Central.

Chicago mayors have chased a downtown casino for generations. With Lightfoot on the verge of snapping the losing streak run up by her predecessors, she needs to stay focused on why she and city leaders sought a casino license in the first place.

Though the proposals differ in location, investment, and startup speed, they’re all projected to bring in $200 million in annual revenue. The income would be critical to shoring up the city’s police and fire pension funds that are near insolvency with pension liabilities of $11 billion and $5 billion respectively and exacerbated by increasing police retirements.

Nor should City Hall forget the intent of the state gambling law itself.

The state of Illinois is hundreds of billions of dollars in debt and teetering on the edge of becoming the first modern state to have a junk bond rating.

The gaming expansion bill aims to ease the burden on Illinois taxpayers and begin improving the state’s long-term fiscal health and credit rating — not bleed out taxpayer dollars as quickly as they come in through multibillion-dollar sweetheart deals for private developers.

A casino that wants to set up shop in Chicago, bringing jobs and revenue with it, should be encouraged to do so without the help of special interest groups and without strong-arming $6.5 billion from Illinois’ hardworking taxpayers.

Brian Costin is deputy state director of Americans for Prosperity-Illinois.

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