Posted on: August 22, 2024, 11:35 am.
Last updated on: August 22, 2024, 11:50 am.
Virginia state lawmakers in Richmond continue to consider whether the state should create an agency to regulate commercial gambling.
Virginia has expanded gambling significantly in recent years and now offers up to five brick-and-mortar casinos with slot machines, table games with live dealers, and sports betting. Virginia is also now home to online sports betting and slot-like historic horse racing machines operated in parimutuel betting establishments.
The Virginia Lottery oversees lotteries, casino activities, and retail and mobile sports betting. The Virginia Racing Commission regulates HHR gambling, horse racing, and parimutuel wagering.
A joint subcommittee of the Virginia General Assembly continues to study the feasibility of establishing a commercial gaming regulatory agency, which would be called the Virginia Gaming Commission. The agency would regulate casino gambling, online sports betting, HHR betting and parimutuel facilities. The Virginia Lottery would again regulate only lottery operations.
The joint subcommittee is expected to present its recommendations to the General Assembly in January.
Consultant recommends founding
During the joint subcommittee meeting on Wednesday, Brianne Doura-Schawohl, a consultant with her boutique firm Doura-Schawohl Consulting, LLC, recommended that the bipartisan panel allocate funds to establish the Virginia Gaming Commission. Doura-Schawohl said a centralized gaming regulator would be best placed to protect consumers, control operators and ensure that the societal harms of gambling expansion are minimized.
Doura-Schawohl said Virginia is obligated to allocate a percentage of its gambling tax to research, prevention, treatment and cure for problem gambling.
The most comprehensive model for risk mitigation and harm reduction is a two-pronged approach between the state health authority and a central gambling regulator,” said Doura-Schawohl. “The regulator should have the power to require and enforce strong consumer protections as part of the licensing process.”
Once one of the least restricted states in gambling, Virginia is poised to become a major player in the U.S. casino industry as new casino resorts open across the state.
In January 2023, Rivers Casino Portsmouth opened as the first permanent casino in Virginia. Larger casino resorts will soon open in Danville and Bristol.
Caesars Entertainment plans to open its $750 million Caesars Virginia integrated resort in Danville before the end of the year. Hard Rock International plans to open the $550 million Hard Rock Hotel & Casino Bristol in the fall or winter.
Petersburg voters will decide in November whether to approve a $1.4 billion multi-use complex with an integrated casino resort. And the Pamunkey Indian Tribe is moving forward with its more than $500 million casino project in Norfolk.
Churchill’s opposition
Churchill Downs, Inc., which operates HHR machines in Virginia and is building the $460 million Rose Gaming Resort in Dumfries, opposes putting regulation of parimutuel betting under the jurisdiction of the proposed Virginia Gaming Commission.
Churchill, who also owns and operates Colonial Downs Racetrack in New Kent, says other states that have shifted regulation of parimutuel betting from a racing commission to a gaming commission have seen horse betting subsidies decline. The Kentucky-based company pointed to Michigan, where the Michigan Racing Commission merged with the newly formed Michigan Gaming Control Board in 1997.
Michigan’s once thriving thoroughbred industry went from over 1,000 races with $9 million in prize money (in 2003) to the end of thoroughbred racing,” said Churchill in his presentation to the joint subcommittee. “In 2003, 375 thoroughbreds were born in Michigan, compared to four in 2022.”
Michigan’s last racetrack, Northville Downs, closed earlier this year, marking the end of the horse racing industry in Michigan.
“Given the nuances of parimutuel betting, live horse racing, simulcast betting and advance payment betting, Churchill Downs believes that oversight of historic and live horse racing should remain with the Virginia Racing Commission,” the company concluded.
