City Hall mulls pushing back deadline on casino bids

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Bids now are due on Aug. 23, and the mayor has faced the politically awkward possibility of getting only one bid, from a partnership of Chicago casino mogul Neil Bluhm and Related Midwest, with the facility going on Related’s The 78 development at Roosevelt and Clark.

The odds of garnering only one bid had seemed to increase lately as two Las Vegas firms that responded to the city’s initial request for information, MGM, followed later by Wynn, announced they would not compete. The fourth gambling company to respond to the city’s initial inquiry, Hard Rock, has not indicated if it will submit a formal bid.

Though Lightfoot has insisted there is “no hometown favorite,” awarding a pact to the Blumn/Related team without competition could generate some negative headlines, given that Bluhm’s daughter, Leslie Bluhm, has donated and raised hundreds of thousands of dollars for the mayor’s campaign fund.

“For the mayor to approve a deal that would be essentially a sole source contract on something this significant—I think there would be a lot of criticism,” says Ald. Brian Hopkins, 2nd.

Now though, the situation may be changing, with some industry sources reporting increased efforts by the city to assure other bidders that no one has an inside track.

My source says there will be at least one other bidder. The identity is unknown. In addition, three other companies lately have expressed strong interest in Chicago, but need more time to finalize bids, I’m told.

Gambling industry sources say they’ve heard there’s at least one other bidder for the Chicago project. But without knowing the identify of that prospect and the three new firms, it’s impossible to know how real the competition is or whether a delay is just designed to provide political cover for an eventual Bluhm/Related pick.

Chicago’s request for bids also has been bedeviled by continuing industry concern about high tax rates, with the levy on gross receipts lower than the 72 percent it was initially but still a hefty 40 percent.

The city also has indicated it wants broad minority participation in the proposed casino, as well as development of a larger entertainment district nearby. All of that is intended to provide hundreds of millions of dollars in new tax revenues that the city would use to pay debt on employee pension funds.

Though the city has not specified a location, the facility is expected to go somewhere in the greater downtown area.

via Crain’s Chicago Business

August 4, 2021 at 02:49PM

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