Virginia Divided on Online Gambling

A brand new study, Gaming in the Commonwealth 2019, created by the Joint Legislative Audit and Review Commission, citing findings in the Innovation Group, has painted a divided image of attitudes towards expanding gaming in the state of Virginia.

The report focuses on proposals to build 5 new terrestrial casinos and examines what they may contribute to the local economy by way of taxation, jobs and funding for charitable causes.

While the study predicted general tax revenue of circa $262m annually, it downplayed the possible for sports betting to possess a major impact. “Sports wagering and online casino gaming would be expected to generate additional state gaming tax income but would have little additional financial impact,” it noted.

“Sports wagering is estimated to generate state gaming tax revenue ranging from $22m to $55m every year, and on-line casino gaming is estimated to produce state gaming tax income of $84 million every year.”

Qualifying those estimates, it added: “A fully developed sports wagering business in Virginia could generate as much as $55m in annual gaming tax income for the state, based on how it is structured, and on-line casino gaming could produce about $84m every year. In contrast to online casino gaming, which would most likely rely on the opening of casinos, sports wagering might be implemented with out casinos and could be provided sooner.”

The report outlined that resort-style casinos could be constructed and sustained in Bristol, Danville, Norfolk, Portsmouth, and Richmond, based on estimates in the Innovation Group. It stated: “These estimates assume an initial $200m to $300m capital investment and an annual gaming income state tax price of 27% (the national median).

“Casinos in these 5 places are projected to annually generate about $970m in net gaming revenue and roughly $260m in gaming tax income for the state. For comparison, the Virginia Lottery generates more than $600m annually after prizes are paid out.”

The proposed casino developments also danger cannibalizing existing gaming returns stated the report. “Casino gaming is projected to negatively impact income generated by most forms of current gaming in Virginia, which would in turn reduce the revenue available for the causes they assistance.

“The greatest influence would be to revenue generated by historical horse racing (HHR), a small portion of which supports Virginia’s revived live horse racing events. This income is projected to decline substantially (45%) from what it likely would happen to be with out casino competitors, and therefore tax income generated by HHR wagering would also decline.

“Lottery proceeds for Virginia’s K-12 public education are projected to decline slightly ($30m or three.6%). Charitable gaming proceeds are projected to decline slightly at the statewide level ($3.1m, or 4%), with larger localized impacts to charitable gaming operations located near casinos and also the organizations they assistance.”

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