Terre Haute Casino Foundation Funding Commitments Stay Binding Despite Churchill Downs Sale Plans, Officials Say
Officials in Terre Haute and Vigo County say the casino's foundation funding commitments survive any ownership change as Churchill Downs explores selling nine regional properties.
Terre Haute and Vigo County officials say a potential change of ownership at the Terre Haute Casino Resort will not undo the property’s binding financial commitments to the local community, after Churchill Downs Incorporated disclosed this week that it is exploring the sale of nine of its regional gaming properties, including the Indiana casino.
The disclosure came in a Form 8-K filed with the Securities and Exchange Commission on July 29, alongside Churchill Downs’ record second-quarter earnings report. Company officials said the review is meant to sharpen the Louisville-based operator’s focus on horse racing and historical racing machines rather than regional casino ownership.
What Churchill Downs Is Putting Up for Sale
Churchill Downs said it has completed “a comprehensive review of the Company’s operational portfolio and long-term capital allocation priorities” and is now exploring strategic alternatives for eight other wholly owned regional gaming properties in addition to Terre Haute: Calder Casino in Florida, Hard Rock Hotel & Casino in Iowa, Oxford Casino Hotel in Maine, Ocean Downs Casino and Racetrack in Maryland, Harlow’s Casino Resort and Spa and Riverwalk Casino Hotel in Mississippi, del Lago Resort and Casino in New York, and Presque Isle Downs and Casino in Pennsylvania.
The company cautioned there is no guarantee any of the nine properties will actually change hands. “The company can provide no assurances that its exploration of strategic alternatives will result in the Company pursuing a transaction or that any transaction, if pursued, will be completed on defined terms or at all,” Churchill Downs stated in the filing. No timetable has been set, and the company said it does not intend to provide further updates unless disclosure becomes legally required.
On an earnings call Thursday, CEO William Carstanjen said divesting the regional casinos would let Churchill Downs concentrate on horse racing in states like Kentucky, Louisiana, and Virginia, along with its TwinSpires wagering platform. Shares of Churchill Downs fell nearly 7% following the announcement, hitting their lowest level in six years, even as the company posted record quarterly revenue.
Why the Terre Haute Casino Foundation Is the Local Focus
In Terre Haute and Vigo County, the more immediate concern isn’t the sale itself but what it could mean for the Terre Haute Casino Foundation, a standalone 501(c)(3) organization funded through a local development agreement between Churchill Downs and Vigo County government. That agreement requires the casino to contribute 3% of adjusted gross revenue up to $175 million annually to the foundation, 3.25% of any revenue above that threshold, and 3% of taxable sports wagering adjusted gross revenue.
The foundation’s eight-member board is appointed by the Vigo County Commissioners, the Terre Haute mayor, Churchill Downs, and the Terre Haute Chamber of Commerce. Earlier this year, it announced six grant awards totaling $2.8 million, and earlier this month it publicly pledged roughly $95 million toward a new Vigo County schools plan that includes a consolidated high school east of the Wabash River. That commitment is contingent on Vigo County making its own matching financial contribution, with the Vigo County Council required to vote on that funding by December 31.
Local officials responding to the sale news this week emphasized that the development agreement underpinning those obligations is tied to the casino property itself, not to Churchill Downs as an owner, meaning the funding commitments would carry over to whoever ultimately acquires the Terre Haute Casino Resort. Because the contributions are calculated as a percentage of the casino’s revenue, the actual dollar amounts owed to the foundation each year will still depend on how the property performs financially, regardless of who owns it.
What Comes Next
Churchill Downs has engaged Macquarie Capital to help run the sale process and indicated it now expects to sell the properties individually or in small groups rather than as a single package, in order to maximize value. Proceeds are expected to go toward reducing debt, reinvesting in projects like the ongoing Churchill Downs Racetrack development, and funding share repurchases.
For Terre Haute, the coming months will likely bring more clarity on both the pace of any sale process and the identity of a prospective buyer — details that could matter to bettors tracking the broader shakeup of regional casino ownership as much as to the local officials counting on the foundation’s continued support for community projects.