Churchill Downs withdraws casino bid in Illinois, plans to open new gaming venue in Kentucky

After announcing on Wednesday morning that it would sell Arlington International Racecourse to the Chicago Bears in a $197.2 agreement, Churchill Downs Inc., that very same afternoon, notified Illinois gambling regulators that it was withdrawing its Waukegan casino license application submitted nearly two years ago as a joint venture with billionaire Rivers chairman Neil Bluhm’s Rush Street Gaming.

Illinois Gaming Board Administrator Marcus Fruchter revealed the Churchill Downs-Rush Street group had pulled out of the running for the Waukegan casino just before a random drawing Thursday to select the order of public presentations for two remaining groups still competing for the license.

A spokesman for Bluhm’s group told the Chicago Sun-Times: “We thank the City of Waukegan, Illinois Gaming Board, and others who had reviewed our application and appreciated the opportunity to be considered. We wish the city and remaining bidders well.”

Rush Street spokesman Dennis Culloton said it was only a coincidence they withdrew the same day Churchill Downs announced the sale of Arlington. Rush Street does not have a stake in the 326-acre parcel that could be the destination for the Bears, but it does have a sponsorship deal with the team.

The two remaining Waukegan casino applicants, Las Vegas developer Full House Resorts and Lakeside Casino LLC, a company led by former Grayslake state Sen. Michael Bond, will make their final public cases for the north suburban license October 13, reports the Chicago Sun-Times.

Following the withdrawal of its Waukegan casino bid, Churchill Downs announced on Thursday plans to open a casino-style venue in downtown Louisville, Kentucky. The new entertainment facility will be called Derby City Gaming and will open with 500 historical horse racing machines, the company said in a press release. The slot-style machines allow people to bet on randomly generated, past horse races.

Construction of the new 43,000-square-foot venue will begin later this year, and the company expects to open in early 2023. The project is expected to generate $10 to $12 million per year in additional purse money for raises, create 350 construction jobs and more than 100 permanent jobs once the venue opens.

The new entertainment venue will include an open-air gaming area, bars, and a retail store featuring Kentucky Derby-themed merchandise.

Although casino gaming is illegal in Kentucky, the state legislature has allowed historical horse racing venues to operate. Those ventures were jeopardized last year when Kentucky’s Supreme Court ruled that at least some forms of wagering on historical horse racing didn’t meet pari-mutuel wagering standards. Lawmakers passed a measure this year intended to fix the flaws cited by the court, reports the Associated Press.

Churchill already operates another historical horse racing betting facility in Louisville. Its current Derby City Gaming venue is in South Louisville, a few miles from the track.