Chicago’s ambitious attempt to ease its financial struggles through a casino has not yielded the expected results, according to a recent City Council report. The temporary casino at River North’s Medinah Temple, which opened in September 2023, has significantly underperformed, with only $63.2 million in new tax revenue generated in the past 16 months. Chief Financial Officer Jill Jaworski presented these figures during a hearing of the City Council’s Contracting and Oversight Equity Committee on Friday, Jan. 10, revealing a sharp contrast to the city’s initial financial expectations.

Performance falls short of projections:

According to WTTW News, although the temporary casino’s income appears modest, a substantial portion of the revenue—nearly 70%—comes from flat fees paid by Bally’s, amounting to $44 million over 2023 and 2024. This arrangement was part of a broader deal approved in December 2022 that concluded a three-decade-long effort to bring casino gambling to the “Windy City.” However, the earnings from the casino’s actual gaming operations have fallen far short of the city’s projections.

In 2023, tax revenue from the casino represented just 25% of the amount originally anticipated by the city, while in 2024, the casino’s contribution was still only 47% of the expected total. These figures highlight the challenges the city faces as it attempts to balance its budget, particularly the financial strain on the police and fire pension funds. Despite these setbacks, city officials remain optimistic about the future, placing their hopes on the permanent casino slated for River West, which is set to open in 2026.

Jaworski pointed out that the limited amenities at the Medinah Temple location are a major hindrance to the casino’s performance. The lack of parking and other essential services have made it difficult to sustain long visits from patrons, which in turn limits gaming revenue. “For a casino to really thrive, you need all of the other amenities that people expect,” Jaworski said, noting that the temporary setup could not meet these needs, as reported by the Chicago Sun Times. Additionally, in the first year of operation, the Medinah casino struggled with overall foot traffic and gaming revenues per admission, failing to reach key targets by 20% to 35%.

While the temporary casino’s performance has been disappointing, Jaworski emphasized that the full potential of the project can only be realized with the completion of the permanent facility. The upcoming $1.7 billion casino and entertainment complex in River West promises a much larger scale of operations, featuring 4,000 gaming positions, a 500-room hotel, and more than 3,000 parking spaces, among other amenities. According to Jaworski, this expanded facility is expected to generate hundreds of millions of dollars, which will directly support the city’s pension funds for police and fire services. The new casino is also anticipated to create thousands of jobs and attract tourists, potentially boosting Chicago’s economy.

Confidence in the permanent facility:

Despite the struggles of the temporary casino, city officials remain confident about the long-term prospects. Jaworski noted that Bally’s has met several of its hiring goals, with more than 600 permanent jobs created, 82% of which are filled by minority candidates, and 45% by women. Additionally, while the casino has been successful in certain areas, it faces significant concerns from city leaders regarding minority contracting and labor participation from economically distressed communities. These issues will need to be addressed as the project moves forward.

While Bally’s has secured financing for the permanent casino, it faces another hurdle: the demolition of the former Chicago Tribune printing plant. Jaworski confirmed that demolition work should be completed by next month, allowing construction to begin in earnest. Bally’s is required to open the permanent casino by September 2026, as stipulated by state law.

Despite these challenges, city officials remain hopeful that the full-scale project will provide the financial boost the city desperately needs. With much larger facilities and a broader range of attractions, the River West casino is poised to become a key economic driver. However, state revenue forecasters have raised concerns about the saturation of Illinois’ gambling market, suggesting that it may be harder to attract gamblers to a new facility in downtown Chicago.