Bally’s seeks 12-year property tax break for Chicago casino amid performance struggles

Bally’s is reportedly lobbying for a 12-year property tax reduction on its $1.7 billion casino and hotel project in Chicago’s River West neighborhood, arguing that the incentive is essential for financial viability and maximizing revenue for the city.  

The Rhode Island-based gambling operator is requesting a reduction from the city’s commercial property tax rate of 25% to the 10% residential rate, gradually reverting to 25% after 12 years, reports Crain's Chicago Business. Bally’s says the tax break would help ensure its development delivers its projected $200 million annual contribution to Chicago through gaming, income, property, and sales taxes.  

Incentives are commonly used for major developments, as they help attract investment and stimulate economic growth, according to the corporate development director at Bally's.  
 
Bally’s push comes as its temporary casino at the Medinah Temple in River North has struggled to meet expectations. In 2024, the venue generated just $16 million in city receipts, less than half the $35 million forecast in Mayor Brandon Johnson’s budget. The temporary casino has also lagged in foot traffic and revenue per visitor, despite being the city’s sole gaming location.  

The underperformance raises questions about Bally’s ability to meet long-term revenue targets and fulfill promises of easing the city’s financial strain, including underfunded public pensions and a declining credit rating.  
 
The tax break proposal, introduced by Alderman Gilbert Villegas, faces hurdles in Chicago’s City Council. Alderman Jason Ervin, a close ally of Mayor Johnson, relegated the proposal to the Rules Committee, signaling resistance within the council. Both Mayor Johnson and Alderman Walter Burnett are reportedly unsupportive of the measure.  

Critics argue that reducing Bally’s property tax rate could shift the burden onto residents and other businesses. Even under the proposed reduced rate, Bally’s annual tax bill would still total $18 million, a substantial increase from the site’s previous contributions before redevelopment.  

The city’s financial challenges, including a recent downgrade of its credit rating by Standard & Poor’s from “BBB+” to “BBB,” have heightened scrutiny over the tax proposal. Bally’s claims that without the incentive, future billion-dollar investments in Chicago could be deterred.  

Supporters, including Villegas, argue that tax incentives are vital to attracting large-scale developments that create union jobs and bolster the economy. Bally’s also points to its commitments, including a $40 million upfront payment to the city’s police and fire pensions and partnerships with minority- and women-owned businesses.  

With skepticism over Bally’s temporary casino performance and longstanding reservations about the company’s partnership with the city, the proposal faces a difficult path forward. The decision ultimately rests with Mayor Johnson and the City Council.