Terre Haute Casino will not Affect Gary

Despite the fact that the state initially gave the license for the west-central Indiana gaming facility to Gary, Gary will not immediately profit from the new casino in Terre Haute, which is slated to begin construction in the coming weeks.

A new local development agreement (LDA) between the Vigo County commissioners and the Churchill Downs subsidiary that will operate the Queen of Terre Haute Casino has no provision for Gary to get a share of the new casino’s earnings.

Gary was entitled to 0.5 percent of adjusted gross revenue from slot machines and table games at the Terre Haute casino, as well as 0.5 percent of commissions from sports wagering vendors affiliated with the casino, under an agreement with the former Terre Haute license holder during the first ten years of gaming operations in Terre Haute.

What is Gary Missing out on?

If the 1,000 slot machines and 50 table games planned for the Terre Haute casino functioned as predicted, Gary would have made around $500,000 per year or $5 million over ten years.

Instead, the new LDA requires Churchill Downs to donate 3% of its adjusted gross revenue up to $175 million and 3.25 percent of any revenue over $175 million to the Queen of Terre Haute Foundation Inc., a new nonprofit organization dedicated to promoting economic development, health and wellness, infrastructure, quality of life, talent retention, and tourism in Vigo County.

State Sen. Eddie Melton, D-Gary, expressed disappointment on Wednesday that the Terre Haute LDA did not financially honor Gary officials’ decades of labor to pave the road for legalized gambling in Indiana, as well as the origins of the Terre Haute casino license.

“That second license was handed to Gary on purpose,” Melton said. “That’s why I wrote legislation this year to make sure we collect what Gary is entitled to.”

Why Wasn’t it Approved?

The Republican-controlled Senate did not move Senate Bill 318. Melton said he plans to try again next year to incorporate provisions from the original Terre Haute LDA into state law, so Gary is fairly compensated for the casino license it surrendered in the 2019 deal to relocate the city’s former Majestic Star casinos from Lake Michigan to a better inland location.

Gary Mayor Jerome Prince also intends to seek legislative action at the Statehouse in order to guarantee that the city obtains the full value of its previous license. The initial Gary payment deal was contingent on the parent corporations of the Gary and Terre Haute casinos maintaining their association.

The Indiana Gaming Commission unanimously refused to renew Lucy Luck Gaming’s Terre Haute casino license last year, despite the fact that its majority owner, Terre Haute businessman Greg Gibson, was also the majority owner of Spectacle Entertainment, the former parent company of the Hard Rock Casino Northern Indiana in Gary at the time.

According to records, the IGC denied Gibson’s license renewal due to Lucy Luck’s slow progress toward building a Terre Haute casino 13 months after a license was first awarded, the company’s lack of a full executive team, and an industry-recognized corporate structure, and the casino’s uncertain financing.

What was the Path to the Terre Haute Casino?

In November, the Indiana Gaming Commission reaffirmed Churchill Downs’ Terre Haute casino license. In August, Gibson was purchased out of the Gary casino by its operating firm, Hard Rock International, a Seminole Tribe of Florida corporation.

According to records, the city of Gary is promised $6.15 million each year under its LDA with the Hard Rock Casino on Burr Street, which is near to the Borman Expressway.

Terre Haute is the county seat of Vigo County and is about 165 miles south of Gary and 7 miles east of Indiana’s Illinois border.

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