CHICAGO – Illinois would become the first state to own a casino under a $506 million bid submitted by a gambling hall operator.

Penn National Gaming, a publicly held company, is bidding for Illinois’ last remaining casino license. It is proposing to build a $255 million casino, sell it to Illinois for $1, and then manage it for the state, a source close to the bidding process said.

The company is in the process of acquiring Bangor Historic Track and is in line to obtain a conditional license from the Maine Harness Racing Commission on Feb. 13.

Penn National, which wants to build the casino in the Chicago suburb of Rosemont, is bidding against six other companies.

Illinois’ nine casinos are privately owned. But Gov. Rod Blagojevich and Chicago Mayor Richard Daley have both expressed interest in having publicly owned casinos run by management companies.

“We still haven’t seen the details of the bid, so it’s way too early to comment,” said Abby Ottenhoff, a spokeswoman for Blagojevich.

Gambling opponents vowed to fight the state’s possible ownership of a casino.

The Rev. Tom Grey, executive director of Rockford-based National Coalition Against Legalized Gambling, questioned how Illinois could regulate a casino that it owns.

If the state gaming board awards Penn National the license, the certificate’s current owners would be paid $156 million and the state would be paid $350 million.

Illinois would own 80 percent of the casino and private investors would own the rest. Penn National would manage the casino for 20 years and receive 10 percent of the gross revenue.

Penn National, a Pennsylvania-based company, owns Hollywood Casino in Aurora.