Bally’s Chicago Casino Falls Short of Revenue Projections

The city has collected only $3 million from the casino, a figure that is $9.6 million below the original projections.

Revenue Underperformance at Bally’s

Despite high hopes, the temporary casino underperformed against the anticipated forecast. This shortfall in gambling revenue is a concerning development for the city, as the casino only averaged $776,582 in local tax revenue per month in 2023. This underperformance is noteworthy, especially since Chicago Mayor Brandon Johnson’s 2024 budget projected the city would net $35 million in local tax revenue from the casino, equating to nearly $3 million a month.

The casino’s financial outcomes starkly contrast with the initial projections. Initially, it was estimated to generate $12.8 million in tax revenue for 2023. However, the actual revenue amounted to just over $3 million, despite the casino operating 24/7 since late December with nearly 800 slot machines, 56 gaming tables, and other amenities.

Implications for Bally’s Permanent Location

The underwhelming performance of the temporary location raises questions about the projected revenue from Bally’s permanent location in River West. The permanent site is anticipated to bring in $200 million annually, dedicated to police and fire pensions. However, given the modest returns from the temporary site, this goal appears increasingly ambitious.

In an ideal scenario, revenue from the permanent Bally’s location would cover only 9% of the city’s annual pension payments. Should it fall short, Chicago might face the need for additional revenue streams, potentially leading to increased taxes for residents.

To address this financial challenge, there is a growing call for structural pension reform. The Illinois Policy Institute has developed a “hold harmless” pension plan, which could save taxpayers nearly $2.4 billion in its first year and almost $50 billion through 2045. This plan not only addresses Chicago’s pension crisis but also offers a viable solution for the entire state.

Our Comment on the Article

The shortfall in revenue from Bally’s Chicago casino highlights the uncertainty and unpredictability inherent in relying on gambling revenue to fund essential services and obligations like pensions. It underscores the need for cautious optimism and prudent financial planning, especially when it comes to public funds and pensions.

The situation also opens a broader discussion on sustainable and responsible financial practices, particularly the need for structural pension reform. Such reforms are vital to ensure long-term financial stability and to prevent over-reliance on fluctuating revenue sources like casino income. This scenario presents an opportunity for policymakers to reevaluate and innovate in financial planning and public fund management.