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Virginia’s Danville selects Caesars as preferred casino partner


The city of Danville in Virginia is in negotiations with Caesars Entertainment to serve as its preferred casino gaming operator, after the state passed legislation to allow construction of its first land-based venues in April.

That bill, House Bill 4, allows for the construction of up to five bricks and mortar facilities in the state, setting a $15m license fee for operators. Licensees would be taxed on a sliding scale, set at 18% for gross revenue up to $200m, rising to 30% for revenue above $400m. 

Only cities with high property and unemployment rates, that are experiencing population decline, will be eligible to host a casino. 

One of these cities, Danville, has now selected Caesars’ bid.

“We received several outstanding bids from a variety of companies competing to be Danville’s choice for a resort casino,” Mayor Alonzo Jones said. “The Caesars bid stood out as the best for our community.”

The resort will be located in Danville’s Dan River Mills industrial complex, with the project anticipated to see a capital investment of more than $400m made by the operator, creating 1,300 jobs with salaries ranging from $35,000 and $47,000.

The venue will incorporate 500 hotel rooms, a 35,000 square foot conference center, and a 2,500 seat live entertainment venue. It will also host multiple restaurants and bars, 2,000 slot machines, 75 table games, 16 poker tables and a sportsbook.

The venue build alone is expected to generate 900 construction jobs.

“Caesars is pleased to emerge from a highly competitive process as the unanimous choice by the Danville City Council to build and operate a first-class casino resort in the city,” the operator’s chief executive Tony Rodio said. 

“We look forward to working with city officials, as well as the people of Danville, on the next steps to advance a project that will benefit the city for many decades to come,” Rodio continued. “We are excited to bring quality jobs and unforgettable guest experiences to Danville, as we do at our 37 properties across the US.”

Once completed, the casino is expected to generate more than $30m in annual tax revenue and supplemental payments to the city. A further $4m is expected to be generated through annual taxes from real estate, meals, sales and hotel taxes, with $20m to be made in up front payments to the city, covering land acquisition and other public investments.

“Unlike most economic development projects, this one does not involve any incentives from the city or state,” Danville city manager Ken Larking said. “It is our intention to use a portion of these upfront funds to begin construction of a new Police Headquarters and to spur private investment in the White Mill.”

However, the project is contingent on a referendum on casino gaming, which will see the matter put to Danville residents on the November 8 ballot for the US General Election. The city will remain neutral in the referendum. 

“While the City of Danville is not taking a position on how people should vote on a referendum, we felt it was important that should the voters decide to approve casinos, that the City do everything it could to make sure it is done well,” Larking explained. “This involved examining the type of development, the qualifications of the operator, and the potential for new revenue, among other factors.”

Casino gaming consultancy Convergence Strategy Group was brought in by the city to help officials better understand the market, and to develop the request for proposal process used to select an operator partner. 

“Today the citizens of Danville should be proud. Several highly qualified and respected companies vied for the opportunity to bring their ambitious, exciting, and job-creating developments to the city,” the consultancy’s managing partner Susan Leckert said.

“Through the competitive RFP process, each company put forth strong and highly detailed proposals, with the Council diligently evaluating and scrutinizing each on its merits and adhering to the selection criteria outlined by the State.”

The Virginia Lottery was also involved in the process, providing a list of factors to be examined when evaluating potential partners. 

The money raised from the construction of the property upon completion – expected in 2023 – will be used to make strategic investments in the city.

“The City Council has three focus areas: reduce crime, improve education, and increase economic development,” Mayor Jones said. “This project provides us with an opportunity to significantly improve each of these areas for years to come.”

Larking added: “The city plans to provide Danville residents a number of opportunities to share with City Council their thoughts on how to best use these new revenue sources to make investments in our community. Our goal is to lift all parts of Danville.”

Virginia’s casino legislation passed alongside HB896, which legalized mobile sports betting in the state, after amendments proposed by Governor Ralph Northam were adopted. This allows up to 12 licenses to be issued, with the tax rate set at 15% of gross revenue. Regulations governing the vertical are to be finalized by 15 September, after which license applications must be processed within 60 days.