Bally’s To Pause Building Parts Of Chicago Casino Project Amid Fight Over Video Gambling Expansion

RIVER WEST — Construction on portions of Bally’s permanent Chicago casino will be paused amid a dispute between the company and the city over Chicago’s controversial approval of video gambling terminals.

The announcement came over the weekend as Bally’s notified the Chicago Community Builders Collective on Saturday that work would stop on some of the site’s amenities such as a hotel, event center and some restaurants.

Bally’s did not clarify on Monday if work on those areas had officially paused.

The setback is being directly attributed to the city’s ongoing dispute over video gambling terminals, which a majority of City Council members approved last year as part of the 2026 city budget despite concerns and objections from Mayor Brandon Johnson, then-city CFO Jill Jaworski, Bally’s and others.

Representatives with Bally’s have argued that legalizing video gambling terminals breaches its community host agreement with the city, which grants the company the city’s “sole casino license.”

“The potential for an uncontrolled proliferation of video gambling terminals (VGTs) is in breach of the City’s commitment not to expand gaming in the Host Community Agreement (HCA) and creates uncertainty that could be harmful for Bally’s Chicago prospects,” a Bally’s spokesperson said in a statement.

The company had estimated video gambling could lead to $260 million in annual tax losses, including about $70 million for the city, as some gamblers shift from the casino to video gambling terminals. Casino revenue is expected to help the city pay its police and fire pension obligations.

The pause is set to affect 1,500 union workers who have been working on the casino’s construction site, according to a statement. Yet Bally’s said its plans to open in early 2027 remain unchanged and that the company “intends to fully honor its commitments under the Host Community Agreement.”

The company did not provide an updated timeline or explain how it plans to meet the host community agreement while parts of the site are paused. To open in early 2027, at least 75 percent of the gaming area, parking, initial hotel rooms and other required amenities must be open, including five food and beverage outlets and a Riverwalk that is at least 75 percent complete, according to the agreement.

The Mayor’s Office declined to comment. The city’s Department of Law said in an email to Block Club that it found out about the pause via news reports and did not receive a notice from Bally’s about the halt.

Ald. Walter Redmond Burnett (27th), whose ward is home to the permanent casino, told Block Club Chicago that he found out about the pause on Saturday while hosting his ward’s annual back-to-school picnic. He called the situation extremely frustrating.

Burnett opposed the addition of video gambling and joined a minority of aldermen who fiercely fought the proposal. He also unsuccessfully pushed to ban video gambling in his ward and several others.

“We haven’t really thought about the repercussions of making this type of deal, even though it has been loudly broadcast that this is a bad deal for the city and for all the operating partners,” Burnett said. “We keep saying that we want to be a pro-business city and continue to help invite more businesses in. We can’t sign a contract and then renege on it before the contract is fully executed … so I’m very disappointed.”

Also potentially at risk is Bally’s $4 million annual community benefits payment, which Burnett said he has heard may not arrive this September as it has in previous years. Of that payment, $2 million is supposed to be set aside for the 27th Ward, according to the host agreement.

The funds have been collected annually by the city but have not yet been allocated. Burnett said he planned to use the money to create a grant program for businesses disrupted by casino construction, bolster security in the area amid concerns about thefts and car break-ins, and, where possible, fund infrastructure improvements around the casino site.

“It’s another thing to just undercut somebody who we just signed a deal with, even if you didn’t like the deal, and we have a bad habit of trying to renege on things that others agreed to when we lost the vote, and we have to stop that as a City Council. It’s really bad,” Burnett said.

The dispute drew a fresh challenge from Ald. Raymond Lopez (15th), who asked city attorneys in a letter Monday to examine whether Bally’s construction pause violates the host agreement and therefore gives the city grounds to terminate it. 

Lopez was one of seven aldermen who voted against the Bally’s deal in 2022, criticizing the the rush to approve it and questioning the financial rationale. The deal has been criticized by neighbors and alderpeople, some who slammed the process as rushed in a similar fashion to the much-loathed sale of the city’s parking meters. 

“While they may disagree with our decision, Bally’s Casino does not have the right or authority to intentionally slow down or effectively stop construction of items within the development agreement. Such an action would be considered a default of the agreement,” Lopez said.

But the host community agreement does not specifically say that pausing construction immediately puts Bally’s in default. Under the agreement, construction would have to be stopped for 120 straight days and not restart before Bally’s receives a default notice for the pause itself to count as an “Event of Default,” the agreement states.

The Department of Law declined to comment on the specifics of Lopez’s letter.

In May, the casino reached a development milestone, topping off the $1.8 billion project with a special ceremony attended by city, union, business and community leaders.

The city is counting on Bally’s gaming tax revenue, which is earmarked for its police and firefighter pensions. Revenue projections created under the Lori Lightfoot administration showed Bally’s permanent casino was expected to generate about $107 million for the city this year, when the casino was originally expected to be open.

Bally’s has faced significant construction hurdles, including needing to relocate its hotel tower due to infrastructure concerns, a demolition spill into the Chicago River and termination of a construction vendor with alleged mob ties.