>> FOR 30 YEARS, CHICAGO'S MAYOR BEEN BETTING ON A CASINO AND WHETHER IT MIGHT BE THE ANSWER TO THE CITY'S BUDGET WOES.

BUT NEW NUMBERS INDICATE THAT GAMBLE MAY NOT BE PAYING OFF AS HOPED THE TEMPORARY CASINO IN RIVER NORTH MEDINA TEMPLE BROUGHT IN JUST OVER 3 MILLION DOLLARS IN TAX REVENUE LAST YEAR.

ALMOST 10 MILLION SHORT OF WHAT THE LIGHTFOOT ADMINISTRATION PROJECTED HERE TO DIVE INTO THOSE NUMBERS AND DEVELOPMENTS WITH THE PLANNED PERMANENT CASINO ARE DEBORAH CARROLL, DIRECTOR OF THE GOVERNMENT FINANCE RESEARCH CENTER AT THE UNIVERSITY OF ILLINOIS'S COLLEGE OF URBAN PLANNING AND PUBLIC AFFAIRS ALDERMAN BRIAN HOPKINS WHOSE WARD INCLUDES THE GOLD COAST, STREETERVILLE AND RIVER NORTH NEIGHBORHOODS.

AND DAVID RISING PRESIDENT OF THE BETTER GOVERNMENT ASSOCIATION.

WE SHOULD MENTION WE INVITED REPRESENTATIVES FROM THE CITY AND VALLEYS, CHICAGO TO SEND A REPRESENTATIVE TONIGHT, BUT THEY BOTH DECLINED.

THANKS TO THE 3 OF YOU FOR JOINING US DEBORAH.

KARA, LET'S START WITH YOU.

WERE YOU SURPRISED BY THE CASINOS, LOW PROFITS?

>> NOT AT ALL.

CERTAINLY THERE ARE SPECIFIC REASONS WHY THE PROFITS CAME IN LOWER THAN EXPECTED.

THEY OPEN LATE.

THEY WANT OPERATING 24 7 INITIALLY.

BUT I THINK WE ALSO NEED TO CONSIDER THE FACT THAT THE PROJECTIONS WERE LIKELY OVERLY OPTIMISTIC FOR THE CASINO TO HAVE A TRUE LARGE ECONOMIC IMPACT ON THE CITY.

IT NEEDS TO BE ABLE TO ATTRACT VISITORS TO THE CITY WHO WOULD NOT OTHERWISE CALM.

AND I THINK WHAT'S HAPPENING IS THAT INDIVIDUALS ARE COMING TO VISIT THE CITY FOR ALL OF THE GREAT REASONS THAT PEOPLE WANT TO COME TO CHICAGO VISIT AND THEY'RE STEPPING INTO THE CASINO TO CHECK THINGS OUT BECAUSE IT'S NEW AND I WANT TO SEE WHAT IT'S LIKE.

BUT IT'S NOT THE MAIN FOCUS OF THEIR VISIT AND THEIR TRIP.

SO THEY'RE SPENDING LESS TIME AND MONEY THERE.

SOMETIMES IT MIGHT BE JUST A PLACE TO GET OUT OF A COLD FOR THE ALDERMAN.

SAME QUESTION TO YOU.

ARE YOU SURPRISED BY REVELATION?

>> NO, I WASN'T SURPRISED.

THAT'S ONE OF THE REASONS I WAS A HANDFUL OF ALDERMAN, INCLUDING VOTED NO ON THIS PROPOSAL ARE WE WERE TOLD BY THE GAMING INDUSTRY THAT THE PROJECTIONS WERE ARTIFICIALLY HIGH.

THAT JUST CHARACTERIZES DECEPTIVE NURSE THAT I FELT IT WAS PART OF THIS ENTIRE PROCESS.

THAT FORCED VALLEY ZANO SAYS THEIR ULTIMATE CHOICE ONE.

WE KNEW IT WAS A MISTAKE.

IT'S THAT THE WRONG COMPANY CHICAGO ON HALSTED IS THE WRONG LOCATION.

AND NOW THAT WE'RE SEEING ARE THE PROOF OF THAT.

NOW.

>> DAVID GRAZING THE TEMPORARY AS WE MENTIONED, IT OPENED SEVERAL WEEKS LATER THAN PLANNED.

DO YOU THINK THAT CONTRIBUTED TO THE SHORTFALL OR, YOU KNOW, IS IT POSSIBLE THAT THE CASINO FELL SHORT BECAUSE IT'S JUST THE CASINO AND IT IS NOT TO THE THE BIG, MASSIVE ENTERTAINMENT AND HOTEL VENUE THAT IT'S INTENDED TO BECOME.

>> YES, AND OBVIOUSLY OPENING HURTS YOUR YEAR AND NUMBER, BUT THE TREND SO FAR ARE NOT PROMISING FOR THE REASONS THAT HAVE BEEN MENTIONED HERE.

THEY ALSO OCCUR AGAINST THE CONTEXT OF GAMBLING INDUSTRY THAT IS SEEING KIND OF A DIVISION BETWEEN THOSE SUPER BIG CASINOS LIKE RIVERS CASINO IN DES PLAINES AND THE REST OF THE INDUSTRY, WHICH HAD A PRETTY GOOD YEAR LAST YEAR.

BUT THAT AGAINST LIKE A 10 YEAR PERIOD DURING WHICH REVENUES GENERALLY HAVE BEEN DECLINING.

SO THERE'S HUGE QUESTION ABOUT SATURATION IN THE GAMBLING MARKET.

LET'S NOT FORGET THAT IS PART OF THE BALLY'S DEAL.

THERE ALSO IS CONSTRUCTION OF SEVERAL NEW CASINOS AND THEY'RE GOING TO MONEY AWAY FROM THE CHICAGO CASINO FROM PEOPLE WHO WHO LIVE HERE, NOT THE VISITORS WHO MAY BE ATTRACTED TO A DOWNTOWN LOCATION, NEW CASINOS AND OTHER PARTS OF THE STATE CREPT AND AROUND CHICAGO, IN PARTICULAR.

DENVER, WHAT IS A SHORTFALL MEAN FOR THE POLICE AND FIRE PENSIONS THAT THIS IS SUPPOSED TO BE FUN DAY?

>> WELL, IT'S NOT GOOD NEWS.

THAT'S FOR SURE.

USING GAMBLING REVENUES FOR SOMETHING FINANCE TEEN PENSION FUNDS IS KIND OF A DOUBLE EDGED SWORD.

ON THE ONE HAND, IT CAN BE VERY GOOD BECAUSE THE TAX REVENUE GENERATED FROM THOSE GAMBLING ACTIVITIES WILL COME FROM INDIVIDUALS WHO DON'T NECESSARILY LIVE IN THE CITY.

AND SO THAT KEEPS TAXES LOWER OVERALL FOR THOSE OF US WHO ARE CITY RESIDENTS ON THE OTHER HAND, GATHERING FAMILY REVENUES ARE VERY VOLATILE AND UNPREDICTABLE AS WE'RE SEEING RIGHT NOW.

AND MAYOR JOHNSON DEPENDING JUST AS MUCH EVEN A LITTLE BIT MORE ON THESE REVENUES FOR THE POLICE AND FIRE PENSIONS.

AND ULTIMATELY IT'S THE CITY'S RESPONSIBILITY TO MAKE SURE THOSE PENSIONS ARE FUNDED.

AND IF THE GAMBLING REVENUES DON'T COME IN AND THEN WE NEED TO LOOK TO OTHER SOURCES.

>> COURSE, YOU KNOW, THERE'S THE DISAPPOINTING BUT WE ALSO LEARNED THAT BALLY'S HOTEL PLANS NEED TO MAKE A FOR THE PERMANENT SITE ALONG THE CHICAGO RIVER.

DAVID, WHAT ARE WHAT ARE THE DETAILS WELL, BALLY'S INITIALLY WAS PLANNING 500 HOTEL ROOMS.

>> THEY STILL HOPE TO BUILD THEIR STILL PUBLIC FACE STILL IS THAT THEY'RE GOING TO BUILD 500 ROOMS ALL TOGETHER, BUT THEY'RE NOW SPLITTING THE STOP.

AND THERE ARE GOING TO BE ABOUT 100 ROOMS.

CONSTRUCTED INITIALLY.

AND IF YOU READ THE TEA LEAVES, YOU THINK IT'S A WAIT AND SEE IF THEY BUILD THE ADDITIONAL 400 ROOMS, THE PROBLEM THEY HAVE IS THAT THEY'VE ALREADY MADE FINANCIAL COMMITMENTS.

THEY DID A SALE AND LEASEBACK OF THE PROPERTY AND THAT GAVE THEM ABOUT 500 MILLION DOLLARS TO WORK WITH FOR CONSTRUCTION COST.

BUT THEY HAVE TO BEGIN PAYING RENT ON THAT PROPERTY.

AND SO THEY'RE GOING TO BE ON UNDER A LOT OF PRESSURE TO CONSTRUCT BUILD AS QUICKLY AS THEY CAN IN ORDER TO BE ABLE TO MEET RENT OBLIGATIONS.

AND THE REASON THAT THEY'VE GIVEN FOR NEEDING TO IS TO AVOID DAMAGING CITY WATER PIPES IN THAT LOCATION WHERE THE HOTEL IS.

AND AS YOU 100 ROOM HOTEL TO OPEN IN 2026, THEY'RE SAYING THE ADDITIONAL 400 >> ROOM TOWER COULD BE BUILT ON TOP OF THAT HOTEL WITHIN 5 YEARS.

AND OBVIOUSLY WE'RE WAITING TO HEAR FROM BALLY'S YOU KNOW, WHEN THAT ALL MIGHT HAPPEN AND WHAT THEIR PLAN IS, ALDERMAN IT COULD THIS BE SERIOUS ENOUGH TO SEND THE ENTIRE PLANE BACK TO THE CITY COUNCIL?

WELL, I THINK IT DEFINITELY INDICATES FURTHER REVIEW BY THE CITY COUNCIL AT A MINIMUM AND HAS TO GO BACK TO PLAN COMMISSION BECAUSE THERE'S IT'S A 30 ACRE SITE.

IT WAS A VERY SPECIFIC PLAN LAID FOR THAT SITE.

>> AND NOW TOLD THAT IT CAN HAPPEN AS IT WAS ORIGINALLY PLANNED.

SO IT HAS TO GO BACK TO PLAN COMMISSION.

I THINK IT SHOULD GO BACK TO THE CITY COUNCIL AS WELL, JUST BECAUSE THIS RISES TO THE LEVEL OF A SIGNIFICANT CHANGE.

IT RAISES QUESTIONS.

WHY DIDN'T THEY NOTICE IN THE FIRST YOU KNOW, THERE'S BEEN A LOT OF DIFFERENT PLANS FOR THE SITE OVER THE YEARS.

SOME OF THE COMMUNITY GROUPS THAT ARE INVOLVED IN THIS NEW THAT THERE WERE DIFFERENT UTILITY CONFLICTS.

YOU'VE GOT HALSTED AND YOU'VE GOT CHICAGO, WHICH ARE ELEVATED STRUCTURES THERE.

AND YOU'VE GOT A LONG HISTORY OF INDUSTRIAL ACTIVITY AT THAT SITE.

THERE COULD BE SOME TOXIC CONTAMINATION THAT HASN'T BEEN DISCOVERED.

THERE'S A WHOLE LOT OF THINGS THAT THAT THIS THAT QUESTIONS, THE DUE DILIGENCE THAT WAS DONE BY THE ARE THE ORIGINAL APPLICANT.

IT'S ONE OF THE REASONS WHY WE SAID INITIALLY THIS WAS NOT A GOOD SITE FOR THE CASINO WHEN THERE WERE A BETTER ALTERNATIVES AVAILABLE.

SO THEY ARE HOLDING THE LINE.

THEY'RE CLAIMING THAT THEY CAN KEEP GOING, THAT THIS IS WITHIN THE PLAN.

THE COUNCIL APPROVED.

>> BUT THE ALDERMAN IS RIGHT.

THIS IS SUBSTANTIAL CHANGE AND THE POLITICS OF IT ARE SUCH THAT IT'S DOUBTFUL THEY'RE GOING TO BE ABLE TO GET AWAY WITH THAT.

>> THEY'RE OPERATING AT THE MEDINAH TEMPLE UNTIL 2026 WITH A TEMPORARY LICENSE 3 YEARS.

THE MAXIMUM AMOUNT OF TIME THAT THAT IS ALLOWED FOR A TEMPORARY LICENSE.

BUT OF COURSE, A LOT IS PROMISED WITH THIS ENTERTAINMENT COMPLEX.

THE BIG HOTEL, 11 RESTAURANTS, A 3,000 SEAT THEATER, DENVER.

WHAT IF BALLY'S CAN'T OR DOES NOT DELIVER IN THE TIME FRAME THAT HAS BEEN PROMISED?

>> WELL, I THINK IT THE FULL PLAN THAT HAS THE ABILITY TO ATTRACT VISITORS.

AS I WAS SAYING BEFORE, WHO MIGHT NOT OTHERWISE COME VISIT THE CITY.

BUT AS THE PLAN BEGINS TO SCALE DOWN AND THEY'RE NOT ABLE TO DELIVER ALL OF THOSE THINGS, THAT PART OF THE REVENUE PROJECTIONS IS GOING TO CONTINUE TO FALL SHORT.

>> ALDERMAN, SAME QUESTION TO YOU WHAT THEY CAN DELIVER.

THAT'S A GREAT QUESTION.

THEY'VE ALREADY SCALED ON WHAT THEY PLANNED ON SPENDING FROM 1.7 BILLION DOWN TO 1.3 BILLION.

I THINK AT SOME POINT WE HAVE TO START TALKING ABOUT WEATHER IN DURING DEFAULT IN THE AGREEMENT WERE NOT THERE YET, BUT WE'RE MOVING IN THAT DIRECTION.

IF THEY DO DEFAULT ON THE AGREEMENT AGAIN, THERE WERE OTHER OPERATORS AT HAD VIABLE THAT SHOULD WE SHOULD HAVE CHOSEN.

SO IT MAY NOT BE TOO LATE.

OUR TO CORRECT THIS MISTAKE AND LOOK AT ALTERNATIVE COMPANIES THAT CAN DO A BETTER JOB.

>> DAVID, WE'VE GOT ABOUT 30 SECONDS LEFT WORKERS OUT AT THE CASINO HAVE ALSO VOTED TO THIS WAS EXPECTED, CORRECT PART OF PART OF THE WINNING.

BUT IT WAS EXPECTED.

IT'S IMPORTANT NOTE ALSO THIS COMPANY IS FINANCIALLY NOT SUPER STRONG.

THEIR STOCK IS DOWN BY ABOUT 80% OVER THE LAST COUPLE OF YEARS.

AND THEY DON'T HAVE A BUNCH OF CASH ON HAND.

SO BEING ON THE KIND OF LIKE MUSCLE THROUGH THIS PROBLEM IS GOING TO BE A BIG CHALLENGE AND RAISES ADDITIONAL QUESTIONS ABOUT THEIR ABILITY TO BUILD OUT THEIR BONDS ARE CURRENTLY TRADING AT $0.65 ON THE DOLLAR.

SO THEY ARE COMPANY THAT STRUGGLING FINANCIALLY, OK?

LOT MORE TO DISCUSS ON THIS ONE.

I'M SURE KEEP THE CONVERSATION GOING DEBORAH.

CAROL ALDERMAN BRIAN HOPKINS AND DAVID RISING, THANKS TO 3