Correction: An earlier version of this story posted on March 15, 2021, reported incorrect and/or inaccurate numbers for the projected annual gaming revenue, the number of visitors a year, the estimated range of tax revenue for the city, and general casino donations. The errors were based on a story first published by Richmond Free Press on March 11, which was quoted as a source in our article, and the corrections were provided on March 16 by Convergence Strategy Group in a letter.
The development of a casino-hotel complex in Richmond, Virginia, could draw between 2.6 million and 2.8 million visitors per year, and generate net gaming revenue in a range of $300 million to $328 million, according to a forecast from Scott Fisher and Suzanne P. Leckert of Convergence Strategy Group.
They project the City could receive between $29 million and $31.5 million per year in various taxes, though in initial years the figure could be lower as the business ramps up.
Fisher and Leckert, who have consulted on more than 400 gaming projects world-wide, offered their projections during a briefing for City Council last week, as reported by Richmond Free Press. The city is employing them to assist in the selection of the company that would build and operate a gambling resort.
Six companies have responded to the city’s request for proposals, with five seeking to develop on South Side and one on North Side. Black-owned media company Urban One is among the bidders for a South Side location.
The consultants projected a casino should draw about 2.8 million visitors a year and pull in between $320 million and $389 million in annual gaming revenue, depending on the location and the level of competition from existing gambling operations, such as the Rosie’s operation in Richmond and the four other approved casinos to be located in cities along the North Carolina border.
One element of competition is to be made illegal on July 1 — the so-called “skill game” slot machines now set up at convenience stores, gas stations and other retail outlets.
Fisher and Leckert sought to reassure City Council that the casinos would be good community partners and would not generate any substantial increases in social ills, including gambling addiction and crime. According to the consultants, any ills would be relatively negligible based on a review of repeated studies conducted in Las Vegas, Massachusetts and other cities and their own discussions with law enforcement in cities with casinos.
Fisher noted that the information indicates that about 1 percent of those who play are gambling addicts needing help. He reminded the council that the state will use a share of the tax revenue from casinos to provide programs to assist problem gamblers.
Leckert and Fisher estimated that the city’s share of the state’s casino tax should yield $19 million to $21 million a year in new revenue for the city’s general fund, with local real estate, personal property, meals, admission and lodging taxes adding $10 million to $10.5 million more annually. The amount of these taxes that the City of Richmond will ultimately receive could differ substantially from these projections as property taxes will vary based upon the location and size of any approved resort casino, they added.
And if Richmond negotiates as well as Danville, the capital city could get an upfront $15 million to $20 million from the winning bidder and potentially gain another fractional share of the gross revenue that is bet in addition to the state tax in which the city would share.
By eliciting competition, “Richmond is in a great position” to extract concessions, Leckert said. Among other things, the city could ensure that Black-owned and minority-owned businesses participate in construction and secure opportunities as vendors and that city residents get considered first for jobs. And there would be plenty of job opportunities, the consultants said. The casino-resort hotel would be a pipeline for skilled and unskilled jobs in a host of fields, ranging from management, computer technology and finance to custodial services, customer service, security and operation of gaming tables.