Bally's slows non-gaming construction on its $1.7B Chicago casino after city legalizes video gambling terminals

Bally's notified its Chicago construction team on 8 August 2026 that it was "resetting the pace of construction" on non-gaming elements of its $1.7 billion River West casino complex^[1], idling roughly 1,500 union tradespeople as a contract dispute with the city escalates.

What Bally's stopped - and what it kept going

The company notified the Chicago Community Builders Collective that it would reset the pace of work on several parts of the development, including the hotel tower, an event center, and multiple planned restaurants. The casino floor itself is a different matter: Bally's says the casino floor remains on track for an early 2027 opening, but the surrounding entertainment complex - including a planned hotel with 500 guestrooms and a rooftop bar - is now in limbo until the video gambling terminal dispute is resolved.

The full scope of the paused amenities is significant. Bally's Chicago is planned to include 3,400 slot machines, 170 table games, and a sportsbook, with resort amenities comprising the 500-room hotel, a 3,000-seat theater, numerous restaurants and bars, and a public park along the Chicago Riverwalk. The hotel tower had already reached its full height in May, and Bally's has spent hundreds of millions of dollars on the project.

The Chicago Community Builders Collective - the management team responsible for the build - is a partnership of minority-led firms. It includes Brown & Momen Inc., d'Escoto Inc., LiveWire Construction Inc., Milhouse Engineering & Construction, Powers & Sons Construction, UJAMAA Construction Inc., Riteway-Huggins Construction Services Inc., and SQN Associates LLC, along with Gilbane Building Co.

The contract dispute at the center of the slowdown

The move stems from Chicago's 2026 city budget, which lifted a longstanding ban on video gambling terminals in bars, restaurants, truck stops, and fraternal organizations across the city. The $16.6 billion budget package was passed by the City Council over Mayor Brandon Johnson's objection.

Bally's contends that the City Council's endorsement of video gambling terminals violates the Host Community Agreement struck in June 2022 - when Lori Lightfoot was still mayor - that stipulates no other casino-style gambling shall be permitted within the city's limits. Under the original agreement, the city collected $40 million upfront plus $4 million per year in impact fees in exchange for granting Bally's exclusive rights to slot machines within city limits.

Chicago's 2026 budget included an estimated $6.8 million in projected video gambling terminal revenue, according to the Chicago Sun-Times. In testimony before the City Council, Bally's Vice President of Government Relations estimated that the VGT expansion could result in a $70 million annual loss in tax revenue for the city and potentially lead to the reduction of 750 to 1,050 projected jobs at the casino resort.

The financial stakes extend further. Chicago has estimated that the casino complex will generate about $200 million annually in local tax revenue.

Aldermen push back - and Bally's lawyers up

The dispute has drawn a sharp response from the City Council. A City Council majority accused Bally's of using the video gambling terminal battle as an excuse to slow construction, contending the company can no longer afford to build. The letter was signed by 28 members of the coalition that muscled through the alternative 2026 budget. The aldermen claim Bally's unilateral decision to pause construction of all non-gaming elements is itself a violation of the company's host agreement with the city.

Bally's is preparing for a legal fight. Bally's spokesperson Lauren Westerfield confirmed that the Rhode Island-based company has hired law firm RKF Global to represent it in a potential legal battle with the city. In late June, Bally's enlisted the firm - where former Mayor Lori Lightfoot is a partner - to handle its government affairs in dealing with the VGT dispute.

Money is also on the table. Bally's could withhold an annual $4 million payment specified in the agreement - a payment that was part of its bid to win the license to operate Chicago's first casino. Bally's spokesperson Westerfield stated: "The city has breached the [host agreement] and we are not obligated for payment to the city."

What to watch

Bally's still targets an early 2027 opening for the permanent casino but has not provided a restart date for the affected non-gaming amenities. The September $4 million payment deadline will be the next concrete test of whether negotiations produce any movement. Company representatives have indicated construction could accelerate again if the city reconsiders its approach to video gambling terminals - but with 28 aldermen publicly accusing Bally's of bad faith, and litigation counsel already retained on both sides, a quick resolution looks unlikely.