Virginia: Richmond considers legal actions against passed state budget provision that favors Petersburg casino efforts

After the Virginia General Assembly passed state budget language that could pave the way for a casino in Petersburg, officials of Richmond city and the eventual developer of a Richmond casino threatened legal action against it. 

In a news conference Thursday morning, Petersburg Mayor and leaders, joined by Senator Joe Morrissey, D-Richmond, heralded state lawmakers for including a budget provision preventing Richmond from holding a second casino referendum until Nov. 1, 2023, after voters there rejected the $600 million ONE Casino + Resort project last year by a narrow margin. The new budget deal would not allow the Virginia Lottery to license the facility if it’s approved until after the completion of a legislative, feasibility study of a potential rival site in Petersburg, proposed by Sen. Morrissey.

After the news conference, Richmond officials and Urban One Inc., the national media company hoping to build a casino resort in Richmond, said in a statement that they might file suit in an effort to let a second casino vote go forward this fall in accordance with an order from Richmond Circuit Court in March that greenlighted a new vote and “pre-certification” from the Virginia Lottery. “This retroactive budget language seeks to unconstitutionally invalidate a final Court Order and inappropriately constrain the Virginia Lottery in fulfilling its regulatory authority in the same manner as it has done for other casinos,” the statement reads. “We will partner with the City of Richmond, including through litigation, to ensure that the people of Richmond have the final say on what happens in their community and that the rule of law is protected.”

Virginia Sen. Joe Morrissey and Richmond Mayor Levar Stoney on Thursday.

The budget language still needs the signature of Gov. Glenn Youngkin to become law. Morrissey said Thursday that he will introduce legislation in January that will designate Petersburg, and not Richmond, as the Virginia locality that will be able to host the state’s fifth casino, Richmond Times-Dispatch reports.

“We’re disappointed the Virginia General Assembly has amended the state budget in a way that will deliberately harm the city of Richmond by denying economic opportunities for its residents,” said Richmond Mayor Levar Stoney. “We are still assessing our legal options but remain firm in our belief that the citizens of Richmond should not be disenfranchised just months before they would have the opportunity to vote.”

Voters approved referendums in 2020 to allow casinos in Norfolk, Portsmouth, Danville and Bristol, but the new state law allowed Richmond to wait a year to undergo a competitive solicitation process to choose an operator for a casino resort. Last year, Richmond selected ONE Casino + Resort to develop a $565 million gaming and entertainment complex on 100 acres at Walmsley Boulevard next to Interstate 95 in South Richmond. Urban One, a Black-owned media company based in Silver Spring, Md., would lead the project. Peninsula Pacific Entertainment (P2E), the owner of Colonial Downs horse track and a widening network of Rosie’s Gaming Emporiums, would operate the casino.

After the rejection, Mayor Levar Stoney and the Richmond City Council decided in January to seek a second referendum, which the state law neither prohibited nor expressly allowed. Morrisey, who lost to Stoney in the 2016 mayoral race, opposed the second referendum and pushed instead to allow a potential casino resort in Petersburg, part of the Senate district that elected him in 2019.

Morrissey’s office counted the number of lobbyists who worked against the Petersburg language; the city of Richmond, Colonial Downs and Maryland-based Urban One hired 23 lobbyists combined who worked strategically to fight Petersburg, according to Morrissey’s office.

The state’s Joint Legislative Audit and Review Commission (JLARC) will do the study on Petersburg’s suitability to host a casino, Morrissey said. Based on a preliminary study, he said, Petersburg will meet the right metrics. Its location directly off interstates 95 and 85 make it a great spot, officials said.