Financial Mess At Hawthorne Could Scuttle Potential Illinois Racino

Hawthorne Race Course, the horse racing track that has struggled to secure financing for a $400 million racino to be built on its grounds in the south suburbs of Chicago, is in arrears for payments to horsemen for both harness racing and thoroughbred racing.

Some of the details were laid out in an Illinois Racing Board (IRB) meeting held Wednesday that was at times short on specifics from Hawthorne’s side and potential areas of redress from the board. Representatives for both the Illinois Harness Horsemen Association (IHHA) and Illinois Thoroughbred Horsemen Association (ITHA) provided the state agency details of bounced checks totaling six figures’ worth to both associations.

Other published reports claim Hawthorne has over $1 million in unpaid purses after canceling harness racing the last four weekends. The Chicago Tribune reported last year there were $6.7 million worth of liens against Hawthorne for unpaid construction work related to the racino.

The IRB suspended the harness racing license of Hawthorne Race Course on Monday, citing a “failure to provide documentation demonstrating its financial integrity, and proof that they can meet the minimum standards outlined in the Horse Racing Act and rules contained in Title 11 of the Illinois Administrative Code.” 

Carey a no-show for meeting

Hawthorne CEO Tim Carey, a fourth-generation owner of the track the family purchased in 1909, was scheduled to appear Wednesday before the board to explain what has been going on, but declined to do so. That clearly irked representatives from the IHHA and ITHA during their public comments to the Board, with IHHA President Jeff Davis saying his absence was “disrespectful not only to horsemen but you as a board.”

ITHA Executive Director David McCaffrey pointed out a conversation he had in which someone said, “There’s a very good chance the last horse race in the Chicago area has been raced ever.

“Imagine that. Washington Park, Arlington, Maywood. There’s a good chance that it could be over.”

Hawthorne Assistant General Manager John Walsh and Director of Racing Operations Tim Miller sat in place of Carey, but neither could provide the type of detailed answers with relation to the track’s finances both the horsemen and the board sought.

Walsh, who testified one of his expense reports checks bounced but all of his payroll checks had cleared, said Carey was in downtown Chicago trying to solve these financial issues. Relaying a statement from the CEO, Walsh said the “Carey family was disgusted by this turn of events.”

Carey, through Walsh, also disputed the amount a claim by Davis regarding a legal court win by Churchill Downs Inc. against Hawthorne. Davis claimed the Dec. 23 judgment, which he said was entered as a “confession” in Cook County, was worth $1.64 million. Carey’s statement countered that “There hasn’t been a settlement. We haven’t paid anybody anything. And the amount is not quite correct. It’s much lower than that.”

Is there a racino savior?

Without the ability to offer specifics, Walsh repeatedly told the board that Hawthorne’s future was going to change for the better in the coming weeks. He said the track was “working with a new partner, someone nearby, someone interested in Illinois racing” without disclosing the name of the potential partner.

“We’re actually just working on something that is gonna happen as far as I’m concerned,” Walsh added. “I’ve never been so optimistic in the last four years as we’re dealing, I think, with the group that is very much in touch with what is needed and willing to go forward.”

Carey, though, has expressed such optimism over proposed racino plans for years to both the IRB and Illinois Gaming Board (IGB) since practically the moment the IGB declared Hawthorne “preliminary suitable” for a casino gaming license in July 2020 during the COVID-19 pandemic.

Hawthorne did perform initial stages of demolition work at the track after receiving that designation in 2020 and 2021, clearing out the first-floor grandstand area where the casino gaming floor would be installed. Progress since that time, however, has come in fits and spurts at best, with Carey offering vague benchmarks of progress to both state agencies while trying to secure financing to complete the project.

The track still has the “preliminary suitable” designation from the Illinois Gaming Board despite the multiple years of delays. Hawthorne also maintains a retail sports wagering license issued by the IGB that allows it to conduct in-person wagering at the track and three OTB locations in the Chicagoland area. Hawthorne’s thoroughbred license remains active, which allows it to continue offering sports wagering.

Its mobile sports betting partner Fanatics, though, recently entered an operational agreement to move its required land-based tether to Argosy Casino in Alton. Fanatics took that step to avoid a potential disruption of services in Illinois should Hawthorne have its thoroughbred license suspended or revoked by the IRB.