(ADDS CDI QUOTES)
The Indiana Gaming Commission on Wednesday evening awarded Churchill Downs Inc. a certificate of suitability to begin the process of building a casino in Terre Haute as part of the license awarded to Vigo County.
After the IGC rejected Full House Resorts’ proposal by a 5-2 count, the board unanimously approved Churchill Downs’ proposal. The two groups advanced as finalists after receiving the required minimum of four votes from the IGC board, beating out Hard Rock and Premier Gaming. Both Full House and CDI received six votes from the seven-member commission, Hard Rock two, and Premier Gaming none.
“We are thrilled for this opportunity and honored for the trust that the Indiana Gaming Commission has placed in CDI and our plan to bring a true destination resort casino to West Central Indiana,” Churchill Downs CEO Bill Carstanjen said in a statement.
The license was not awarded yet because the IGC is still working through the appeal Lady Luck filed after its application for a renewal of the license originally awarded in May 2020 was unanimously rejected in June. On Monday, the IGC rejected a settlement offer of the appeal by Lady Luck by a 4-0 vote with one abstention, which is why only a certificate of suitability was declared at this meeting.
Careful consideration by the commission
The final vote capped a lengthy day of deliberations in Indianapolis for the IGC, which listened to presentations from all four groups and conducted a rigorous question-and-answer session after each one. Both Full House and Churchill Downs were allowed to make additional final five-minute presentations after the first vote, highlighted by Churchill Downs CEO Bill Carstanjen noting he had a check for the $5 million license fee ready to hand over if selected as the winning bid.
The IGC selected CDI despite the city of Terre Haute backing the Hard Rock proposal for a “rocksino” for the second time. Mayor Duke Bennett and the Terre Haute City Council sent letters of recommendation to the commission on Hard Rock’s behalf, while the Vigo County Board of Commissioners passed a resolution of support.
Hard Rock partnered with local investor Spectacle Gaming. Hard Rock also teamed with Spectacle Gaming to open a venue in Gary in May, though that process also had some hiccups due to issues surrounding ex-Spectacle CEO and Chairman Rod Ratcliff.
CDI looks to create ‘The Queen of Terre Haute Casino Resort’
— WISH-TV (@WISH_TV) November 18, 2021
In its proposal to the IGC last month, Churchill Downs described a casino that would include up to 1,000 slot machines, 50 table games, and a 125-suite luxury resort. It would also include eight total dining areas, including a rooftop bar as well as a retail sportsbook run by TwinSpires. CDI’s sports betting arm currently conducts mobile wagering in Indiana via Rising Star Casino near the Kentucky border — which is also near CDI’s corporate headquarters in Louisville.
Though CDI has no previous casino gaming history in Indiana, it does have a track record of success in the industry. It is a majority stakeholder in Rivers Casino in Des Plaines over the border in Illinois, and that venue has generated more than $375 million in revenue this year — nearly 40% of the state’s overall revenue from its 10 casinos.
“In the days ahead, we look forward to continuing our collaboration with local officials in Vigo County and the Indiana Gaming Commission as we work to turn our vision for the Queen of Terre Haute into a reality,” said Jason Sauer, Senior VP of Corporate Development for CDI.”
Another potential point of appeal for the Indiana Gaming Commission to select CDI was its ability to put its focus on the Terre Haute location and solid financial footing. Churchill Downs pulled out of a joint bid with Rush Street Gaming for a casino license in Waukegan in northern Illinois, leaving Full House Resorts as one of two finalists there with North Point while also vying for the Vigo County license.
Additionally, CDI has money to spend following a purchase and sale agreement with the Chicago Bears in late September for the land where Arlington Park International Racecourse is located for $196.2 million. Churchill Downs noted in the press release for that deal it would use the proceeds of the sale to purchase or invest in replacement property that qualifies as an Internal Revenue Code §1031 transaction. A casino would appear to satisfy the terms of the IRS Code as “real property for like kind.”
Another factor for CDI wanting access into Indiana would be the state potentially adding iGaming into its suite of gaming options. Neighboring Michigan launched iGaming at the start of the year and has seen it quickly develop into a key piece of its tax revenues, collecting $139 million in tax receipts through the first nine months of the year.
A pair of bills in the Indiana statehouse failed to get out of committee by a February deadline earlier this year, though legislators are expected to bring the subject back up next year considering the success Michigan has enjoyed since launch.
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