Chicago’s skyline is reflected in the water of the thawed snow as a cyclist passes by on North Avenue Beach on Monday, March 1, 2021 in Chicago. (AP Photo/Shafkat Anowar)
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Last week’s announcement that the City of Chicago plans to build one iconic casino resort in the city came with a surprise: The winning bidder will also receive the concession to install slot machines at O’Hare and Midway international airports.
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The Illinois legislature cleared the way for slots at O’Hare and Midway last year, but there weren’t many details about how that would happen.
Now we know that the company that is the successful bidder will also oversee the concession of the airport slots. We now also know that the successful bidder will be allowed to install 4,000 machines at the resort and the two airports.
If a company decides to install airport slots, it will need to analyze the best return on investment for the number of slots in the resort, the larger O’Hare Airport and the smaller but still busy Midway.
Las Vegans are quite used to seeing slot machines here. In the United States, only McCarran International Airport and Reno-Tahoe International have them. A McCarran spokesperson said the local airport has about 1,400 slot machines operated by Michael Gaughan’s Airport Slot Concession Inc.
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In its best year, fiscal year 2019, the airport slot machine franchise generated $37.4 million in gaming revenue.
Gaughan, who has 170 employees on different shifts at the airport, said the McCarran operation is “a glorified gambling route,” meaning employees operate the machines, pay out the big jackpots and help customers 24/7.
He said he’s been talking to Chicago for about three years and is licensed in Illinois. Gaughan noted that the concept the city is putting forward could be difficult for operators, given the 40 percent effective tax rate on gambling and the likely possibility that President Joe Biden may want to raise taxes on corporations in the coming years.
One of the benefits of having slots at McCarran is that the revenue generated reduces costs for airlines using the airport, a point made last week by Southwest Airlines chairman and CEO Gary Kelly.
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“I’d say for Chicago, anything that lowers our operating costs at an airport we’d all be ahead of,” Kelly said. “I think Las Vegas has led the way with some really innovative techniques out there.”
But unfortunately for Southwest, the tax revenue generated by Chicago, where Midway International is the airline’s second-busiest station with 255 flights to 76 destinations, goes toward police and fire service pension liabilities, not airport operations.
I also asked Kelly what Southwest thought of the prospect of legalized gambling to Texas. Proposals have been made to invite the development of casinos in Dallas, Houston, San Antonio and Austin.
“I doubt I’ll say anything about what’s going on in the state of Texas right now, but I think by extension, anything that generates more travel, everyone in this room (the Southwest executive team) would be all for it” , he said.
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Chicago Mayor Lori Lightfoot discussed details of the city’s RFP process in a press conference and discussed the potential for slots at the two airports.
“That was a decision that was made by the legislature and I think the idea was that in the downtime that people have at airports, it will give them another chance for entertainment,” Lightfoot said. “So we’re excited about that opportunity. It’s one license, so no matter who the partner we select, they have that capability available at both O’Hare and Midway. We’ve already explored a number of locations in both places, so I think it just increases and expands the opportunity for an operator here in Chicago.”
Lightfoot said she didn’t think dividing 4,000 slot machines across three locations would take anything away from the planned casino resort.
“The main show has to be the land-based casino itself, of course,” she said. “The airports are just another option if they want to take advantage of that for additional revenue. But we’ll really be guided by what the operator thinks makes the most sense financially for them and it’s clear our goal is to make this a really special destination.”
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The deadline for submitting an RFP response is August 23. The final selection of a casino resort partner is expected to take place early next year and the casino is expected to open in 2025.
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Think the Las Vegas March Madness experience couldn’t get any better? Wait for the city to start hosting tournament games at the T-Mobile Arena and Allegiant Stadium. The Go Go Claw slot, inspired by the old-fashioned arcade game, at Circa in Las Vegas, Tuesday, August 17, 2021. (Rachel Aston /Las Vegas Review-Journal) @rookie__rae
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Circa Operations Director Rahmi Chaghouri will be showing the Review-Journal the Go Go Claw slot machine, inspired by the old-fashioned arcade game, on Tuesday, August 17, 2021 at Circa in Las Vegas. (Rachel Aston/Las Vegas Review-Journal) @rookie__rae
Balls with paper clips at the Go Go Claw slot, inspired by the old-fashioned arcade game, in Circa in Las Vegas, Tuesday, August 17, 2021. (Rachel Aston/Las Vegas Review-Journal) @rookie__rae
The Go Go Claw slot game looks and plays a lot like a crane machine that you find in an arcade or the entrance of a supermarket.
However, there are no stuffed animals or electronics in boxes. The price for a successful treasure hunt is cash.
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The game’s manufacturer, Aruze Gaming America Inc. from Las Vegas, field-test what it calls a top-notch game at a handful of casinos in Southern Nevada, including three in Las Vegas. Based on early returns, business leaders believe they have a product with staying power.
The D Las Vegas received the first two machines on June 29: one downstairs and one upstairs. They were an instant hit, and by early August executives had moved the upstairs machine to the family-owned Circa Resort to try to capitalize on the game’s early popularity, said Rahmi Chaghouri, director of operations at Circa.
Now, most evenings, lines form at both machines as people wait their turn to crack the claw, Chaghouri said.
“I can’t recall a product that has been rolled out that has gotten this kind of attention and interest from gamers and media alike,” Chaghouri said, standing next to Circa’s machine on a recent Tuesday morning.
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San Diego resident Adrian Zamora lined up the claw with his target and pressed the bet button. The claw dived into the ball pit, gripped one between three pins, rolled it up, then swung into the plexiglass. The ball fell into the pit and the screen changed from the $20 price image to a loss image.
He was intrigued to try something different on a casino floor. He put in a $20 bill and played about a dozen tries, winning a few times.
Did Zamora feel like he had mastered it after completing his second attempt at “Go Go Claw”? “Not really,” he said.
He was only able to play because an Aruze mechanic had repaired the winding mechanism about 15 minutes earlier. The machine has been “beaten up” from the frequent use, the mechanic said, noting that it was the second time he had repaired anything with that machine that day.
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“Is that a trick question?” quipped Rob Ziems, president, secretary and chief legal officer at Las Vegas manufacturer Aruze Gaming America