By Jason Crane
The Aurora City Council listened to many citizens at the Tuesday, Oct. 18 Committee of the Whole meeting. They were against a proposal to supply $50 Million in municipal bonds for a new casino to be built.
• Eight individuals used their voices for up to three minutes each:
Seven of the eight expressed concerns about the city government of Aurora providing the $50 Million in municipal bonds. One was for it.
Several expressed they weren’t against the Casino moving to Farnsworth Avenue and their future plans, just against the City government providing any funds to help pay for the project.
Other reasons of concern included: Publicly funding a $50 Million loan for a $2.75 Billion corporation with a municipal bond which should be used to fund a public project for the public good when resources are not on hand. Examples given were public schools, public health centers, libraries, infrastructure, not a private corporation.
Aurora resident John Laesch said, “10 million for the land, $50 million for the bond. The CEO makes $65 Million. We’re subsidizing the rich!”
Another resident said she is disturbed by the lack of transparency, forums, and accessible information regarding the deal asking “Why are we not a priority for the public servants we elected?”
Brian Dahl, president of the Fox Valley Building & Construction Trades Council in Aurora, said, “On behalf of the affiliates of the Fox Valley Building Trades in support of the new casino.
“Illinois Public Act 102-0013 which amended the Illinois Gambling Act in June of 2021, requires casinos to enter into a fully-executed project labor agreement with the applicable local building trades council.
“Project labor agreements benefit working men and women, contractors, communities, and taxpayers by ensuring projects are completed on time and on budget. Requiring employee training, encouraging that public investment benefits local communities.”
He added, “We look forward to working with representatives from the Casino, and once selected, their general contractor, who will be overseeing construction.
“I would also like to commend the mayor, MOED (Mayor’s Office of Economic Development), aldermen, City staff, and the Casino for making this happen.”
Their comments to the Aurora City Council can be seen at the 7 minute mark on the city government of Aurora’s Facebook page video here.
• Placed on unfinished business for possible further discussion at the full City Council meeting Tuesday, Oct. 25, was an ordinance authorizing a redevelopment agreement between the city government of Aurora and Penn National Gaming (now PENN Entertainment) for the Hollywood Casino Development in the City of Aurora.
City government of Aurora documents show in 1990 the Riverboat Casino Act created Illinois casinos. Under the referenced act, 10 riverboat casinos were permitted to operate, but were required to be on water, and Aurora was one those.
Among other Citywide programs and initiatives, the Aurora Hollywood Casino opened June 17, 1993, in response to a stagnant economy that had persisted since the 1980s. During this time several large factories left downtown Aurora to contribute to an unemployment rate that reached 16%. The intent was to recreate an engine of revival, creating job opportunities and a point of attraction for residents as well as visitors. Unfortunately, the Casino did not produce the ongoing synergy that was expected, and downtown Aurora did not gain the population and supporting businesses as was expected.
In 1999 the law changed to allow casinos to be permanently docked (creating an “island barge”) whereas, before then, casinos were required to leave the dock only for a limited number of hours.
In 2003 the Hollywood Casino was purchased by Penn National Gaming (now PENN Entertainment). PENN Entertainment is a leader in North America. PENN Entertainment Inc. was founded in 1968 and specialized in horse racing and betting once the only legal form of gambling. At the present time PENN Entertainment Inc. is an American operator of casinos and racetracks based in Wyomissing, Pa.; successfully operating 44 facilities in the United States and Canada, many of them under the Hollywood Casino brand. Most recently, August 2022, PENN Entertainment exercised its option to fully own Barstool Sports.
Unfortunately, due to a number of reasons the Casino’s revenue peaked in 2004 and since that time revenues have steadily declined. Key reasons for this decline are that it is a nearly 30-year-old facility that, because of its location, is not able to expand to add additional amenities or gaming to compete in today’s gaming environment. Changes in the Illinois Gaming law have also impacted the casino. Since the casino opened, more casinos have opened and more gaming opportunities (including video gaming terminals) are available.
In an effort to support the Casino and City revenues, the City worked in concert with State representatives in 2018 and 2019 to change the Illinois Gaming Law. One of the key changes that benefits the city government of Aurora is that the law now allows for the relocation of existing casinos from their water location to another location within the same municipality. PENN Entertainment has also taken advantage of the other major change to Illinois gaming law, namely, the legalization of sports wagering.
In 2018 the City purchased 50 acres of land on Bilter Road, northeast of the Chicago Premium Outlet. A potential use for the property that was considered at that time was for the new casino. However, after gathering initial feedback from residents, further and comprehensive consideration was given; it became clear that the Bilter location was not conducive. The City and Penn, after exploring other locations, proactively agreed to develop the Casino on Farnsworth Avenue instead. The southwest corner of Bilter Road and Farnsworth Avenue is now identified as the preferred location. Given the high volume of shoppers that visit the Chicago Premium Outlet Mall every year, and its accessibility and its visibility to and from I-88, the proposed location is a tremendous site, that benefits both the Casino and the Outlet Mall.
City acquisitions along Farnsworth, had already started in 2018 with the acquisition of an old car lot at 2500 and 2502 N. Farnsworth Avenue, followed by the former Fox Valley Inn at 2450 N. Farnsworth Avenue, and the former Motel 6 at 2380 N. Farnsworth Avenue. Staff members have been able to procure option agreements for two new properties, consisting of four different parcels which, upon closing, combined with already city owned properties add up to 18.82 acres.
Since the beginning, the City government’s goals have always been to make the Casino a regional attraction in support of other businesses in the downtown and to provide a revenue source that helps keep property taxes as low as possible on the City residential and business community. Gaming revenues have historically been used to fund and co-fund programs to enhance public service activities for community benefit, including education, economic development, and as a supplement to general funds which are used for public infrastructures.
Unfortunately, like the Fox Valley Mall, the Casino has seen reduced attendance as well as reduced revenues over the past 15 years. Similar to the Fox Valley Mall ownership goals, the City and Aurora’s key businesses associated with these locations have not wanted to watch a downward trend in utilization lead ultimately to a closure with empty facilities.
The concept in the 1990s of locating downtown casinos along the Fox River is outdated, and newly established casinos throughout Illinois and the Country are primarily located along Interstates. The new location is ideal to help bolster the success of the Casino and the outlet mall and therefore the City of Aurora. In addition, under the conditions of the RDA, the downtown casino site is transferred to City ownership at no additional cost shortly after the opening of the new casino facility. The site will be clear and ready for redevelopment, continuing the positive trend of redevelopment of the City’s downtown with new revitalized residential and commercial opportunities.
Planning for, and mitigating any traffic is important for all parties. City staff members and PENN Entertainment, Inc. representatives have proactively commissioned the needed feasibility studies with private consultants, among which is a comprehensive traffic study which will be used to base the required roadway improvements being the preliminary offsite transportation Improvements.
It is expected that the new casino will not only build upon the number of visitors to the Chicago Premium Outlets but will also attract more shoppers. According to preliminary research the Casino and the Outlet Mall compliment themselves nicely because their peak times and days are at different times.
The City government is being asked to provide a $50 million bond (14% of the project) to assist in the original construction of the property. Importantly, the anticipated increase in tax revenues from the new facility is expected to provide revenues to not only service the bond but to also generate millions of additional dollars annually to reinvest into the community.
The Casino’s operations provide approximately $6 Million annually in taxes. With new competition coming online soon, City officials expect tax revenue to decrease to $3.7 Million annually if the status quo is maintained. The proposed new casino at a more convenient location expects to draw roughly $10.5M in annual tax revenue. This does not include the additional property taxes which also add up to millions of extra dollars for the City.
• Final approval for items on the Committee of the Whole consent agenda are set to be made at the October 25 Aurora City Council meeting.