Virginia lawmakers in Richmond are currently examining the potential establishment of a dedicated agency to regulate commercial gaming within the state. With several gambling expansions in recent years, including up to five brick-and-mortar casinos featuring slot machines, live dealer table games, and sports betting, as well as online sports betting and historical horse racing machines operating in parimutuel wagering facilities, the commonwealth is considering a more centralized regulatory approach.
Currently, the Virginia Lottery oversees lottery gaming, casino activity, and both retail and mobile sports betting, while the Virginia Racing Commission regulates historical horse racing (HHR) gaming, horse racing, and parimutuel wagering. A joint subcommittee of the Virginia General Assembly is reviewing the feasibility of consolidating these responsibilities under a new entity, the Virginia Gaming Commission. This body would handle the regulation of casino gambling, online sports betting, HHR wagering, and parimutuel facilities, allowing the Virginia Lottery to focus strictly on lottery operations. Recommendations from the subcommittee are anticipated by January.
During a meeting on Wednesday, consultant Brianne Doura-Schawohl from Doura-Schawohl Consulting, LLC, advised the bipartisan panel to allocate funds for the new Virginia Gaming Commission. She emphasized that a central gaming regulatory agency would be the most effective way to provide consumer protections, govern operators, and mitigate the societal risks associated with expanded gaming. Doura-Schawohl argued that Virginia should dedicate a portion of its gaming tax revenue to researching, preventing, treating, and facilitating recovery from problem gambling. She advocated for a bifurcated approach that involves both the state health agency and a central gaming regulatory agency, empowered to enforce stringent consumer protection provisions as part of licensing requirements.
Virginia is on track to become a significant player in the US casino industry, with the opening of several retail casino resorts. Rivers Casino Portsmouth became the state’s first permanent casino in January 2023. Larger casino resorts are also set to open soon in Danville and Bristol. Caesars Entertainment plans to launch its $750 million integrated resort, Caesars Virginia, in Danville by the end of the year, and Hard Rock International is expected to open the $550 million Hard Rock Hotel & Casino Bristol later this fall or winter.
Meanwhile, voters in Petersburg will decide in November whether to authorize a $1.4 billion mixed-use complex featuring an integrated resort casino. Additionally, the Pamunkey Indian Tribe is progressing with its more than $500 million casino project in Norfolk.
However, not everyone supports the idea of consolidating regulatory oversight. Churchill Downs, Inc., which operates HHR machines in Virginia and is developing The Rose Gaming Resort, a $460 million project in Dumfries, opposes placing parimutuel wagering under the new Virginia Gaming Commission. Churchill Downs, which owns and operates the Colonial Downs Racetrack in New Kent, argued that states transitioning parimutuel wagering regulation from a racing commission to a gaming commission have seen negative impacts. They highlighted Michigan, where the thoroughbred industry declined significantly after the Michigan Racing Commission merged with the newly formed Michigan Gaming Control Board in 1997. Churchill Downs noted that Michigan’s thoroughbred racing went from over 1,000 races with $9 million in purses in 2003 to ceasing altogether, with only four thoroughbreds born in the state in 2022. Michigan’s last racetrack, Northville Downs, closed earlier this year, effectively ending the state’s horse racing industry.
Churchill Downs concluded by stating that due to the specific nature of parimutuel wagering, live horse racing, simulcast wagering, and advanced deposit wagering, oversight of historical and live horse racing should remain with the Virginia Racing Commission.
