Gambling company withdraws Waukegan casino bid hours after announcing Arlington sale to Bears

One of the state’s most influential gambling companies withdrew its bid to win the right to open a new casino in Waukegan just hours after it announced it would sell Arlington International Racecourse to the Chicago Bears, officials said Thursday.

Churchill Downs Inc. confirmed the flashy $197.2 million agreement with the Bears Wednesday morning, a deal that — if finalized — ensures no rival casino developer breaks ground on the northwest suburban oval that’s only a short drive away from the company’s premier Illinois cash cow: Rivers Casino in Des Plaines.

By Wednesday afternoon, Churchill Downs notified Illinois gambling regulators it was withdrawing its Waukegan casino license application that was submitted nearly two years ago as a joint venture with billionaire Rivers chairman Neil Bluhm’s Rush Street Gaming.

The turning of the cards could suggest Bluhm and company are going all in with a proposal for the newly authorized Chicago mega-casino, though he’s kept a poker face on that possibility so far.

Illinois Gaming Board Administrator Marcus Fruchter revealed the Churchill Downs-Rush Street group had pulled out of the running for the Waukegan casino just before a random drawing Thursday to select the order of public presentations for two remaining groups still competing for the license.

“We thank the City of Waukegan, Illinois Gaming Board, and others who had reviewed our application and appreciated the opportunity to be considered. We wish the city and remaining bidders well,” a spokesman for Bluhm’s group said in an email.

Rush Street spokesman Dennis Culloton said it was only a coincidence they withdrew the same day Churchill Downs announced the sale of Arlington. Rush Street does not have a stake in the 326-acre parcel that could be the destination for the Bears — but it does have a sponsorship deal with the team.

“Quite simply, a lot has changed since 2019,” Culloton said.

The bid was pulled after regulators spent nearly two years vetting it along with a wave of other hopefuls looking for a piece of the pie in Gov. J.B. Pritzker’s 2019 gambling expansion that added six new casinos. A Gaming Board spokesman declined to comment on the drain of resources at the perennially overworked and understaffed agency.

Churchill Downs previously drew the wrath of the Illinois horse racing industry for passing up on the opportunity to open a “racino” at Arlington, which likely ran its final races last weekend. Critics have argued the company’s true intention was to shield Rivers Casino from competition, though Churchill Downs CEO Bill Carstanjen has insisted they want to open a thoroughbred racetrack somewhere else in the state.

Photo courtesy Arlington International Racecourse

Carstanjen has been noncommittal so far about the prospect of applying for the Chicago casino, which has drawn a tepid response from other major national gaming developers concerned with high taxes. So has Bluhm, who has close ties to Chicago Mayor Lori Lightfoot.

It’s not clear if either — or both in tandem — have applied to run the 4,000-position Chicago casino, but they’d be instant front-runners. With interest flagging at the city’s August application deadline, Lightfoot pushed it back to Oct. 29.

Bluhm’s Rush Street Gaming was among the companies that responded to the city’s initial request for information seeking ideas last summer for the long-sought Chicago mega-casino. Culloton said making a formal pitch for it is still “under consideration.”

The two remaining Waukegan casino applicants — Las Vegas developer Full House Resorts and Lakeside Casino LLC, a company led by former Grayslake state Sen. Michael Bond — will make their final public cases for the north suburban license Oct. 13.

Four development groups competing for one license in the south suburbs will also make their final pitches: Calumet City, Lynwood, Matteson and a site that straddles Homewood and East Hazel Crest.