In an update on Bally’s Chicago, Bally’s has stopped construction on everything but the casino. In its statement, Bally’s said it still plans on opening the casino early in 2027. The company wrote, “The potential for an uncontrolled proliferation of video gambling terminals (VGTs) is in breach of the City’s commitment not to expand gaming in the Host Community Agreement (HCA) and creates uncertainty that could be harmful for Bally’s Chicago prospects.”
Not surprisingly, the city’s aldermen were not pleased. Twenty-seven of them sent a letter to Bally’s: “Chicago did not enter into an agreement for a casino floor alone. It entered into an agreement for the complete development Bally’s promised to build. The Council expects Bally’s to deliver that project and expects the administration to enforce that commitment.”
The City Council wants VGTs for the tax revenue they would generate and to help small businesses. Over the objections of the mayor, the Council put revenue from the VGTs in the budget for 2026. The city would get $6.8 million in taxes; the estimate is based on the 3,300 businesses eligible for VGTs. The forecast predicts 80 percent would opt to install the games; each establishment is allowed six games, giving Chicago over 15,000. In the first six months of 2026, the 49,738 VGTs in Illinois averaged $34,252 in revenue per unit. For Chicago, that would equate to approximately $1 billion in annual revenue.
Bally’s believes VGTs would cut into its revenues and harm its chance of success. It certainly would. It is not unexpected that Bally’s would protest. However, it is uncertain whether Bally’s can deliver on its promise. Rather like a warring nation, Bally’s may not have the weapons in its arsenal to carry out its threat. If Bally’s continues with its current plan and finishes the casino, it still needs the state’s approval to open. If it is in violation of the contract with the City of Chicago, it is unlikely to receive regulatory approval. Bally’s could keep the temporary open for a time, but not indefinitely. Even with the extension the state granted, Bally’s has limited amount of time to complete its construction, open the permanent, and close the temporary. And it will have rent payments due on the unbuilt hotel and entertainment center.
Chicago is under no pressure. As things sit now, the city can and will begin the process of granting licenses and collecting taxes. Bally’s will take the city to court, but the outcome there is also not guaranteed. The company is an awkward position, and it begs the question: How did it get in this predicament in the first place?
Chicago fought hard to get a casino. The mayor expected every major company in gaming to apply, but only three did and none were the big-name companies with a casino on the Las Vegs Strip. Bally’s won the bid with a promise to build a $1.7 billion resort. When Bally’s bid for the Chicago license, it was in a full-fledged expansion mode and possibly a little too eager. However, nothing has gone according to plan and the resort is already a year overdue, without a specific target date for opening — “sometime in the early part of 2027.” And that was before the latest delay and complication in an already-delayed and complicated process.
It should have been a red flag that Sands, Wynn, Caesars, MGM, Penn, and Boyd passed on the opportunity. Why? Why would any casino company miss a chance to put a casino in the Second City? The reasons are different for every gaming company, but there is a common theme: a shifting landscape. Sands articulated its position over New York City. The corporation said that the gaming landscape was not stable. It did not want to invest $10 billion in a resort in the Big Apple, only to wake up on the morning of the opening to discover the state had legalized online casino gaming.
Is that not what happened to Bally’s? One day, the corporation woke up to discover that Chicago was going to allow 15,000 slot machines in its backyard. Years ago, I attended a presentation on a casino license for Istanbul. That was before the era of American gaming companies going abroad to ply their trade, but some were exploring the options.
The presenter said his company had passed on the opportunity in Turkey for political reasons. The company did not think the government was stable or that taxes would remain at the suggested rate. In addition, it feared a new conservative/religious government that would ban gaming all together. The stability of the tax rate seemed like the key for analyzing new foreign jurisdiction. But a government switching directions is equally threatening, going, for example, from no slot machines in my town to bring ’em on!
For Bally’s, Chicago was a foreign jurisdiction or at least it should have been evaluated as such. The company might have passed on Chicago if it had considered the possibility of VGTs or igaming. Internet casinos hang in the air in Illinois like a shoe waiting to drop. There is a new government in Chicago. But the situation is worse than a new government. It is a new landscape, one filled with VGTs, igaming, new casinos, and prediction markets. The ground under Bally’s feet is shifting. Sputtering and threatening are not going to solve the problem. It is deeper and systemic.
