Casinos in Virginia Won’t Have As Large of an Impact as Expected
A 200 page report was released earlier this week by Virginia state auditors, revealing that the legalization of sports betting, online gambling and five full-service casinos will bring $367 million to the state in annual tax revenues. This amount is a solid number and could convince legislators to approve a bill on the matter. However, the group conducting the review says a gambling expansion for the state will not have as big of an impact as expected.
The Joint Legislative Audit and Review Commission completed the review of gambling expansion in the state, warning lawmakers that such an expansion will not bring as many jobs as expected. It will also not have as large of an economic impact like what developers are suggesting.
In the past, two businessmen from Bristol proposed a casino plan to develop a facility at the former Bristol Mall. The lobbying effort to do so cost $1 million and resulted in the passage of a bill that focuses on authorizing casino gambling as well as other gaming options in the state.
The bill caused the commission group to conduct a review on how the expansion of gambling would impact the state’s economy. State auditors findings revealed the lesser impact and lawmakers will now need to pass yet another bill to authorize the new options, online casino gaming, sports betting and casino facilities.
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During an upcoming legislative session, lawmakers will be discussing the matter and will decide to move forward with the gambling activities or focus on other options.
Less Jobs Coming
The review by the commission focused on five potential casino builds. The cities associated with casino projects included Bristol, Portsmouth, Danville, Richmond and Norfolk. The auditors found that the five facilities will create close to $1 billion in total revenues annual. If the proposed 27% tax rate stands, the venues would generate around $297 million in tax revenues.
Sports betting is estimated to bring $55 million in tax revenues each year while $82 million will be generated from online gambling. It is expected that around $65 million will be lost from existing gaming operations like the lottery due to the impact from new gaming options.
Auditors have revealed that the study showed less jobs will be created than promised by the casino developers. Backers of the Bristol casino promise around 2,000 new jobs during the first year and around 3,200 by the fifth year. The commission says only a little over 1,000 new jobs will be created from the facility.
Reportedly, the casino proposal with the highest potential for new jobs is the one in Richmond, which should bring around just over 2,000 employment positions. The employment positions will have a median salary of around $33,000 a year. The main analyst of the review, Joe McMahon stated that the casinos will have a positive impact on the economy but it will be modest relative to the broader local economy.
The developers of the Bristol project have shown disappointment in the findings of the commission’s review. It was recently announced by the developers that the new casinos will be operated by Hard Rock International, creating a Hard Rock casino brand in the state.
It will be interesting to see if lawmakers agree to move forward with the expansion after the recent surveys results. While the impact may be less than expected, it would still bring massive amounts of new revenues to the region.