Casino investors place their bets

 
 
  • An artist's rendering of the proposed Waukegan casino.

    An artist's rendering of the proposed Waukegan casino.

  • An artist's rendering of the proposed Des Plaines casino.

    An artist's rendering of the proposed Des Plaines casino.

Published: 11/26/2008 12:03 AM

Rosemont and Waukegan officials hoping to land a casino found themselves Tuesday explaining past associations to gambling regulators as Des Plaines officials labeled their bid the "least risky bet."

"Rosemont will not be the source of any problems for the gaming board," pledged Rosemont Mayor Bradley Stephens before the Illinois Gaming Board. "We want to be a host community that will set the standard."

Rosemont lost the license after years of legal wrangling following questions of mob influence in the bid of Emerald Casino and the suburb itself. This time, Rosemont is taking a hands-off approach, vowing to have nothing to do with the Trilliant Gaming bid led by a former MGM executive.

The declaration came during a lengthy Illinois Gaming Board hearing in which all three bidders on the state's previous license made their most detailed pitch yet to win the right to build a casino in the North or Northwest suburbs.

Negotiations are ongoing and the owner of what could be Illinois' most lucrative casino may be selected by year's end. South and West suburban bidders were struck from the list in the first round of cuts on Nov. 14.

Like Rosemont, Waukegan also found itself answering questions about investors Tuesday. Indicted political insider William Cellini was an investor in the Waukegan proposal for years. Cellini also owned another Illinois casino.

Board Chairman Aaron Jaffe asked Waukegan Gaming LLC representatives about Cellini's current involvement. Investor Ed Duffy, a former chieftain in the Illinois horse racing business, said Cellini sold his stake, measured at up to 5 percent, 18 months ago for about $35,000.

"Another gentleman bought out his interest," Duffy said.

Cellini was indicted this fall over a scheme to strong-arm kickbacks from companies seeking to invest state pension money. He pleaded not guilty and awaits trial.

Who owns the casino is only one consideration that gambling regulators must take into account. With the state facing a $2 billion budget shortfall, revenue is a key factor as well.

Each bidder claimed Tuesday that their casino would draw the most gambling dollars, and therefore the most taxes, with both Rosemont and Des Plaines officials arguing they can recapture Chicago gamblers lost to Indiana boats.

Des Plaines and Rosemont proposals vary greatly in how much each side is willing to put upfront for the license. Rosemont investors are offering $435 million, compared to Des Plaines' $100 million initial payment.

Investors on all sides are expected to modify their proposals in the coming weeks during negotiations with gambling regulators.

Waukegan officials argued their bid will draw gamblers from Wisconsin and not directly compete with existing casinos in Elgin and Aurora.

Waukegan officials also said money from their casino, backed in part by the former owner of Sportsman's racetrack in Cicero, would help revitalize an economically disadvantaged region around the struggling city.

Des Plaines investors, meanwhile, attempted Tuesday to gain an edge on Rosemont by touting their 20-acre site as a better location, given its access to Devon Avenue and Des Plaines River Road. The project will include two new hotels in the long run, meaning more new jobs than Rosemont's casino, which would be located in a developed area.

"Not only are we your best bet, but we are your least risky bet," said Neil Bluhm, a major developer, casino owner and chief investor in the Des Plaines' bid.

Gaming board officials gave little indication Tuesday of where they were leaning in their selection. One board member spoke favorably of the Waukegan proposal's focus on regional development and also expressed reservations about Rosemont's revenue sharing plan because it left some of the poorest suburbs out.

The public is invited to comment on the proposals before the Illinois Gaming Board on Dec. 8.