In the last few weeks, Mayor Lightfoot has revealed several important details about the casino she’s pushing so hard to develop, including . . .
Where it will go—near Chicago and Halsted on the city’s near north side.
Who will run it—Bally’s Corporation.
And why we need it—to raise money to pay police and firefighter pension obligations.
But she’s not told us the details many Chicagoans probably most want to know—how much it will cost.
For the moment, Mayor Lightfoot is sort of pretending the project has no public costs. As though Bally’s is shouldering the expenses.
Or as the Sun-Times recently reported: “Bally’s will foot the bill for those infrastructure upgrades, according to Jennie Huang Bennett, the city’s chief financial officer. . . . No tax increment financing district will be created for the corporation either, she said during an interview with the Sun-Times editorial board shortly after the casino announcement.”
Wow. That’s quite a pledge. Of course, I hope no one in Chicago actually believes it—that would mean you’ve learned nothing over the last few decades.
To understand why I’m so skeptical, consider the scope of the project that Bally’s and the city have proposed.
They want to build a super-big casino on a site where a Tribune printing plant has been operating for over 40 years—so there’s a lot of wear and tear on the property. Also, they’ve got train rails running along the site.
Before they actually build the casino, someone is going to have to pay to buy the property, demolish the printing plant, rid the site of any toxins, and probably do something about those unsightly train tracks.
Plus add traffic lights, widen and pave streets, and do whatever else it takes to assure locals that said super-big casino won’t overwhelm the nearby River West neighborhood with traffic.
And the Lightfoot administration is suggesting that all of this won’t cost the public a dime? That Bally’s will foot the whole bill? C’mon, Chicago, you’ve got to be too smart to fall for that.
Mayor Lightfoot is not the first Chicago mayor to cover up the real costs of her fantasies—and I’m sure she won’t be our last.
To hear our mayors, Chicago has an almost magical ability to build stuff for no cost to the public. Even as the public winds up paying for it with rising property taxes year after year.
In particular, Chicago’s mayors are skilled at underestimating a project’s cost and overestimating its benefits.
But to suggest that Bally’s will pick up the whole tab? Man, I haven’t heard such a tall tale since Mayor Daley said it wouldn’t cost the public a dime to buy up Michael Reese Hospital, tear it down, and construct an Olympic Village.
Last I heard that deal has cost taxpayers around $100 million in property taxes—even though we didn’t even build the Olympic Village because we didn’t get the Olympics. Mercifully.
So you can be pretty sure that the casino will cost you tens of millions in property tax dollars, which will probably come from a TIF. Because the tax increment financing program is the main source—perhaps the only source—of discretionary money the mayor has for projects like a super-big casino.
And that brings me to the second part of the statement in the Sun-Times. The part where the chief financial officer contended that “no tax increment financing district will be created for the corporation.”
That statement may actually be true. That is—the city might not have to create a new TIF district for Bally’s. But that’s only because there are several already existing districts to draw from.
That area is crawling with TIF districts. Thanks to research assistance from John McDermott Jr.—activist, troublemaker, and fellow TIF geek—I can name them. Here goes . . .
River West, Chicago/Kingsbury, Near North, Goose Island, Cortland/Chicago River, and North Branch (South). If I left any off the list, I’m sure John will let me know.
So yes, the city could pay for the casino project by bringing in property tax dollars from nearby TIFs (they call it porting). Is that legal? Well, I suppose. It’s how Millennium Park was paid for.
Look, I love construction projects that give people jobs. But as one of the taxpayers footing the bill, please don’t tell me I’m not footing the bill. Or that there aren’t more pressing development needs—that would also create construction jobs—all over the city, especially on the south and west sides.
What we need with this project is less cheerleading and more skepticism in the form of an objective cost-benefit analysis. That’s where a dispassionate bean counter subtracts the real costs of building the casino from the anticipated benefits of operating it.
Then we will know if the project is worth the investment.
In this case, Mayor Lightfoot says the casino will bring in about $192 million a year for the city—all of it dedicated to pay for police and fire pension obligations.
Alderperson Walter Burnett—the mayor’s chief casino cheerleader—has been going around saying alderpeople must approve the project or raise property taxes to pay for the pensions.
My guess is that the casino will wind up making us do both. That is—we’ll raise property taxes to build the casino, which probably won’t bring in enough revenue to cover pension obligations. So we’ll raise property taxes to cover the rest of our pension tab.
This is starting to remind me of the parking meter sale, which Mayor Daley insisted was a great deal for taxpayers.
He kept bragging about the $1 billion the deal would bring in—without mentioning the meters were worth around $10 billion over time.
So it’s like we borrowed $1 billion and paid $9 billion in interest. Like I said, this hustle has been going on for a long time.