Virginia: Richmond's Council approves contract terms for Urban One casino

On Monday, the Richmond City Council finalized plans and contract terms for a casino resort project that the city is including on ballots this November. 

The authorities approved Host Community Agreement for ONE Casino + Resort, which establishes the expectations of both the city and RVA Entertainment Holdings if the proposed casino is allowed to go further. If the ballot measure is approved in three months’ time, media conglomerate Urban One will have the city’s greenlight to build a 250-room luxury resort hotel and casino along Interstate 95, near the intersection of Commerce Road and Walmsley Boulevard.

The new agreement follows last week's Virginia Lottery Board approval of proposed permanent casino gaming regulations.

The project is expected to generate $30 million in annual tax revenue and the creation of 1,000 jobs for the development. If the measure passes, the terms include a $25.5 million upfront payment and $16 million in payments to local nonprofits and government organizations over the next 10 years. Off that amount, $6 million would be designated for “research initiatives” and “the missions of the city’s Office of Community Wealth Building and Richmond Public Schools”, according to the Richmond Times-Dispatch. The plans also include a television and radio production studio on site. 

The City Council unanimously approved the terms of the agreement with the casino developer after six of eight people who spoke during a public hearing on Monday expressed support for it. Many of them were local business and nonprofit leaders.

The casino was initially projected to open by December 31st, 2023. However, the deadline was recently offered to be extended in exchange for an additional $1 million on top of the payment offered by Urban One. 

The city is incentivizing the early completion of the project by allowing the company to give the city 1.875% of its annual gambling-related revenue for one year, instead of the 3% the company intends to allocate annually if the project is completed before October 1st 2024.

Other terms of the agreement include:

• $25 million in advertising for public initiatives at no cost to the city
• an annual compensation package averaging $55,000 for casino resort employees;
• up to $500,000 in reimbursement to the city for consulting fees it paid during the evaluation process
• $200,000 annually for problem gambling mitigation
• a 40% participation goal for small- and minority-owned businesses for the construction and operation of the facility.

The city is presenting this project under a new state law that enables Richmond to permit casinos if voters approve it.  This law allowed Danville, Norfolk, Portsmouth and Bristol to greenlight casinos.

It was Richmond Mayor Levar Stoney and a panel of city officials who recommended the Urban One project, after the evaluation of six casino resort development proposals that were submitted in response to a request for bids that the city issued in December. 

Other developers proposed building casino resorts on Arthur Ashe Boulevard, the Forest Hill Avenue area and Manchester, but the city rejected those plans alleging concerns about location, neighborhood opposition, state regulatory review processes and financing plans. 

Some Richmond residents, however, are undecided or do not think a casino will benefit the city. According to Richmond Times Dispatch, Councilwoman Reva Tramell, representative of the area where the casino would rise, asked her colleagues and residents throughout the city to support the project. 

“This is a golden opportunity, not just for the South Side and 8th District, but for the city as a whole. Give my people, all of us, a change”, she asked.