The mayor of Las Vegas infamously offered up her city as a coronavirus “control group” if it meant getting the casino industry going again. An official in Louisiana recently said he has no idea if his state’s riverboat casinos will be coming back once things start to reopen. Moody’s, the financial ratings company, predicted casino profitability could fall by as much as 70 percent over the next year.
In other words, it’s not a great time for Virginia to be getting into the casino business.
But with at least four cities set to vote on casinos in November, the industry players who want to build them say they’re still on track to proceed. Any casino project in Virginia would require a minimum capital investment of $300 million.
“We intend to invest at least that much, and COVID-19 does not change our plans for the project’s scope and scale,” said Andy Poarch, a spokesman for the business group that’s partnering with Hard Rock International to build a casino in Bristol. “We want to help and be part of the solution as a catalyst for our local economy.”
Since it could take years for any casino to open, gambling interests say they hope the projects can be part of the post-coronavirus economic recovery.
“We expect the current impact of COVID-19 to be over when the project opens,” Poarch said. “As we move past the current COVID-19 restrictions, we anticipate there will be pent-up demand for residents in Bristol, and across the country, to take vacations and enjoy local entertainment and dining options.”
The Pamunkey Indian Tribe is moving forward on its plan to build a casino in Norfolk and has not shelved its more speculative plan to try for a second casino in Richmond. Jay Smith, a spokesman working with the tribe on its development efforts, said that, unlike more established gaming operators, the tribe doesn’t have big revenue sources that have dried up due to the coronavirus crisis.
“They didn’t have money to start with that they’re losing so it hasn’t really affected them and their ability to move forward,” Smith said. “We’re still two years away from opening probably at this point. But any time you’re talking about jobs jobs jobs, in this economy, it’s a good thing.”
The Pamunkey Tribe’s casino plans are being financed by Tennessee businessman Jon Yarbrough, who made his fortune in the tribal gambling industry.
A state report released last year found that legalized casinos, sports betting and online gambling could bring in up to $367 million in tax revenue per year, but it’s not yet clear what post-pandemic casino traffic might look like.
State lawmakers finalized a casino legalization bill last month on a highly unusual workday that saw the General Assembly meet in two different locations with legislators masked up and separated to prevent spreading COVID-19. Gov. Ralph Northam had suggested mostly technical amendments to the bill, and lawmakers approved the changes by a wide margin.
That set the state on a path to start setting up its casino industry and the regulatory apparatus to oversee it when the bill takes effect July 1. The bill authorizes casinos in five cities: Bristol, Portsmouth, Danville, Norfolk and Richmond. But voters in those cities will have to give their approval in ballot referendums before the projects can proceed.
The casino legalization bill specifies that the referendums in four of the cities will be held in November, but gives some leeway for courts to pick a different date.
The bill allows a longer timeframe for the city of Richmond, a fairly new entrant to the casino discussion that has not yet begun the process of choosing a casino partner. Richmond spokesman Jim Nolan said the city is planning to hold its referendum in 2021 and intends to conduct a community engagement process on the issue over the summer.
Danville is reviewing seven casino proposals it received in a competitive bidding process and expects to choose a winner within the next few weeks, according to city spokesman Arnold Hendrix.
Portsmouth has partnered with Chicago-based Rush Street Gaming on its casino project. Rush Street did not respond to requests for comment on whether the pandemic has disrupted its plans in Virginia.
The closest thing to casinos in Virginia now — the Rosie’s slots parlors operated by Colonial Downs Group — have been shut down for more than six weeks under Gov. Ralph Northam’s order closing indoor entertainment facilities. Those venues will remain closed under the tentative reopening plan the governor wants to implement Friday.
Colonial Downs — which is considering opening new locations in Danville and the town of Dumfries in Prince William County — said it is continuing to pay its employees full salaries and benefits during the shutdown.
“We are optimistic as Virginia shifts from ‘stay-at-home’ to ‘safe-at-home’ that we can strengthen our partnership with the commonwealth and continue to look at opportunities to expand, hire more employees and contribute more tax revenues to state and local economies,” Aaron Gomes, the chief operating officer of Colonial Downs Group, said in a statement. “As a privately held company we are not subject to the same financial implications as our publicly traded colleagues. We look forward to re-opening Rosie’s in Richmond, Hampton, New Kent and Vinton as soon as it is safe to do so as well as exploring other opportunities across the state with protocols that will continue to ensure health and safety.”
Colonial Downs has expressed some interest in competing for casino licenses to expand its operations beyond the slots-like historical horse racing machines that are the main draw at its Rosie’s locations.
In anticipation of the casino law taking effect, the Virginia Lottery, which will regulate the state’s expanded gambling industry, recently launched a website laying out timelines and procedures for the arrival of casinos and sports betting.
The Lottery says it will begin accepting preliminary documentation from casino operators in June.
Casino operators will not be able to formally apply for a license unless their projects win approval from local voters.
The Lottery is also in the process of establishing a regulatory process for online sports betting.
Though it’s not clear when sports will return, the Lottery says legalized sports betting won’t be available in Virginia until December “at the earliest.”