Illinois regulator delays Waukegan casino license amid rejected bidder's allegations against the process

The Illinois Gaming Board has postponed the voting session to award a Waukegan casino license after a rejected bidder alleged city officials “rigged” the selection process to favor a former state lawmaker.

Gambling regulators were set to give preliminary approval for the venue on Thursday to either Full House Resorts or North Point Casino. However, the process will now be delayed as the Forest County Potawatomi Community alleges that both the former Waukegan Mayor Sam Cunningham, along with City Council allies, have rigged the election, reports Chicago Tribune.

The tribe, whose bid for the Waukegan casino was rejected, claimed in a recent federal court filing that officials improperly favored North Point’s bid, which is led by former state senator turned video gambling executive Michael Bond. According to them, allies whose campaigns Bond bankrolled are trying to benefit his company.

At a Cook County Circuit Court hearing on Wednesday over the Potawatomi effort to block a decision from being taken, a state lawyer announced the board will be holding off on a vote until a federal court mediation between the city and the tribe, scheduled for later this month.

Attorneys for Waukegan Potawatomi Casino LLC, owned by the tribe, have for more than two years been seeking to reverse a City Council decision taken in October 2019 of not forwarding its casino proposal to state gaming regulators for consideration, reports Patch.

Court filings reveal the tribal nation believes the process was manipulated and that Cunningham secretly directed the City Council to exclude their bid in a discriminatory manner. Moreover, it is claimed the city violated the Illinois Open Meetings Act and the state’s gambling expansion law as city officials have allegedly failed to report some communications with Bond to regulators.

According to sworn testimony from 6th Ward Ald. Keith Turner, cited by the tribe, on October 17, 2019, in a special City Council meeting, Cunningham told him: “These are the three that we want to send to Springfield.” The Potawatomi have also pointed to financial contributions Bond has allegedly provided to council members who voted in line with Cunningham’s request.

“Cunningham’s secret directive was the culmination of a rigged process — a process Cunningham manipulated to achieve the outcome he preferred,” the Potawatomi community alleges in its argument against the city’s request for summary judgment in the ongoing lawsuit, further reports Chicago Tribune.

Former Mayor Cunningham responded on Wednesday to the claims being leveraged against him, calling Turner’s sworn account “a flat-out lie.” He further defined the bidding process as “open, fair and transparent.”

Meanwhile, the city argues in court documents that “the tribe’s internal communications and history of litigation reveal this scorched earth lawsuit is factually suspect.” The filing also claims the tribe is using federal courts “as zoning and licensing boards of appeal,” in an attempt “to invoke the federal court’s jurisdiction as a means of appealing” Waukegan’s licensing decisions.

According to the Potawatomi court filings, Bond directed more than $50,000 to Cunningham’s mayoral campaign in 2017. This was supposedly followed up two years later with $266,000 in contributions to four successful aldermanic candidates to the nine-member Waukegan City Council.

The tribe is also claiming an associate of Bond, who was in charge of a video gambling industry association founded by the former senator in 2016, “set up a joint campaign office” for the Bond-backed candidates, providing support including coordinating mail programs and phone banks, among other actions.

Communications allegedly even continued after Gov. J.B. Pritzker signed the measure to create the casino license for Waukegan, in June 2019. This required communications with applicants for the license to be disclosed to the Gaming Board within 30 days.

North Point has also been accused of attempting to achieve an unfair advantage. The city attorney at the time, Robert Long, failed to disclose to the Gaming Board an email sent by the firm to the city in October 2019.

In the email, the business suggested that if Waukegan decided to forward multiple casino applications for consideration, the developer could enter a new agreement to reduce its initial offer to match the terms of the project team “offering a lower financial contribution to the city.”

The tribe further claims city officials also selected Neil Bluhm’s Rush Street Gaming/Rivers Casino for consideration as a result of Rivers’ teaming up with Waukegan Gaming LLC, the entity that had been selected by the city in an unsuccessful 2004 effort to bring a casino to town and had filed a suit seeking the new license.

“Rivers punched its own ticket in the form of damaging information it unearthed in the Waukegan Gaming litigation,” claims the tribe. Moreover, it is being alleged the city also favored Full House “as a relatively weak competitor” that could 'quash' “the perception of bias toward North Point.”