New study finds casino would be profitable in both Richmond and Petersburg

Posted at 6:22 PM, Oct 17, 2022
and last updated 2022-10-18 10:36:03-04

RICHMOND, Va. -- A “brawl” is brewing at Virginia’s Capitol over where to put a casino in Central Virginia. A state-sponsored study released Monday found a casino resort to be viable in the city of Petersburg on its own, but also found the Petersburg project would be profitable if Richmond built a casino too.

Leaders in both cities are already angling to bring the project to their backyard because of the potential of millions of dollars in tax revenue gambling generates annually. The analysis said two casinos would generate more money overall but less money for each city if they were not the exclusive home of the casino.

“It’s likely to be a brawl,” said Sen. Janet Howell (D-Arlington), chair of the Joint Legislative Audit and Review Commission (JLARC) committee following the report’s release.

The report, prepared by an entertainment development consulting firm, examined the economic feasibility and considerations of building a casino in Petersburg. The report lays out several scenarios that include only building a casino in Petersburg, another where only Richmond gets one, and another in which both Richmond and Petersburg projects move forward. The study assumes the casinos would be fully operational by 2028.

In the Petersburg-only scenario, the project would generate more than $200 million in revenue in 2028 and create more than 1,200 jobs in the city, according to the report. Four other Virginia cities where casinos have already been approved (Norfolk, Portsmouth, Danville, and Bristol) would see their revenues negatively impacted, but overall, Virginia would see a boost in gaming tax revenues.

If Richmond were to get the casino project and not Petersburg, the study finds the casino would generate nearly $300 million in revenue in 2028 and create several hundred more jobs than the Petersburg-only scenario.

If both Richmond and Petersburg built casinos, the report said the Petersburg one would be significantly smaller than the Richmond project. The study found the Richmond casino would generate more overall gaming revenue, the other casinos in Virginia, including Petersburg in this scenario, would see their revenue decrease significantly.

You can see the exact breakdown of the revenue projections here and do a deeper dive into the full report here.

State Senator Joe Morrissey (D) represents portions of Richmond and all of Petersburg. Following the report’s release Monday, Sen. Morrissey stood with Petersburg leaders arguing it should get the next, exclusive chance to build a casino in Central Virginia.

“They would cannibalize each other. You would not get destination casinos; you would get regional casinos,” Morrissey said of the scenario in which both cities build casinos. “The whole idea behind the legislation initially to have these casinos would be to have challenged cities get the casino. Richmond isn’t challenged.”

Petersburg officials said they have been in contact with six developers already, and those proposals center around the larger resort casino model.

“We are looking for the best casino that is going to bring as much value to our community as possible. Richmond had its chance. We need to support our small cities and small towns,” said Del. Kim Taylor (R-Petersburg).

Last year, Richmond voters narrowly defeated a casino project south of the city that would’ve generated hundreds of millions of dollars of investment and thousands of jobs in the area. Richmond officials continue to pursue another referendum to revive the project.

“We’re pleased that the facts presented in the JLARC study reaffirm Richmond as the best choice for a Central Virginia casino. We look forward to further discussion on this important economic development opportunity, which would provide well-paying jobs and much-needed revenue to address priorities,” said Richmond Mayor Levar Stoney in a statement.

Charles Willis, president of the Richmond Highway Neighborhood Civic Association, where the failed casino project sat, said his members remain committed to bringing a casino to south Richmond. Willis noted that Richmond’s revenue and jobs projections in the study outpaced Petersburg’s significantly.

“They didn’t throw the baby out with the bath water,” Willis said. “South Richmond is a Petersburg within itself. We have the greatest needs of all in the city as well as across the region.”

Ultimately, the Virginia General Assembly will have to decide if one or both of the projects should head to voters, and state lawmakers reconvene in January 2023. Only then, would the plans head to voters of each city via referendum for an up or down vote.

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