The Pamunkey Indian Tribe is hoping to be the first to introduce high-stakes gambling to the state of Virginia, where it has been illegal for more than a century.
With the backing of a billionaire investor with years of experience in Indian gaming, the tribe has acquired three adjacent parcels of land in the state capital Richmond and one in the port city of Norfolk, where they want to develop multi-million-dollar resort casinos.
They aren’t the only parties wanting to get into the casino business in Virginia, however, and it’s up to the tribe to convince Virginia voters that their plan is the best for the people and the state.
Gaming law
The 1988 Indian Gaming Regulatory Act (IGRA) divided gaming into three classes, setting regulatory standards for each. The law established the National Indian Gaming Commission (NIGC), an independent agency, to oversee Indian gaming and ensure tribes stick to the rules.
It allows federally recognized tribes to conduct gaming on land that has been taken into trust by the federal government—but only if that land is located in states that have legalized the class of gambling that will be offered.
Tribes may regulate their own low-stakes gaming like bingo, but they can’t engage in class III, Las Vegas-style gaming such baccarat, blackjack or slot machines without tribal and NIGC approval.
If tribes want to pursue a commercial route to gaming—that is, operate outside of tribal land—they must negotiate revenue-sharing deals with the state. And as a 2012 report to Congress on Indian gaming stated, “Increasingly, states have demanded significant revenue sharing and non-gaming concessions in exchange for class III compacts.”
The Pamunkey recently unveiled specifics on the $350-million casino resort in Richmond, and a $700-million casino resort along the Norfolk waterfront, which Norfolk already has agreed to.
“The key here is ‘destination resorts,’” said Pamunkey Chief Robert Gray. “We want to partner with Virginia state tourism, attract out-of-state visitors, and increase tourism to these areas.”
The law says that casino revenues must be used to provide for the general welfare of the tribe and help fund operations in neighboring cities or counties.
“We want to ultimately get off federal grant programs and have the financial independence to provide our own health care, housing, education and jobs for our tribal members,” said Gray, “and also to help the community.”
The tribe plans to build a casino workforce training center on one of the Richmond land parcels.
“When the workforce is trained and the casino is operating, we’d use that land to build a grocery store or a health clinic, two of the things which are desperately needed in that area of the city,” said Pamunkey spokesman Jay Smith. “The tribe would need assisted living for its aging population. And of course, if they open a senior living facility, it would be for tribe members and non-tribe members as well.”
Only after Indian operators meet tribal and community welfare obligations does federal law allow them to distribute per capita payments to individual tribe members.
There’s potential for the tribe to earn big money, said former Colorado Sen. Ben Nighthorse Campbell, a member of the Northern Cheyenne Tribe who co-sponsored the IGRA.
“The tribes in rural areas like the Dakotas, Wyoming or Montana? It’s all nickels and dimes,” Campbell said. “To be successful in gaming, tribes have to be near a metropolitan area, an interstate highway, or a resort area—then they can make real money.”
Richmond, one of America’s oldest major cities, has a population of more than 1 million. A two-hour drive from Washington, it sits on the East Coast’s longest highway (I-95) and is a major commercial transportation hub.
Competition likely
While no other groups have announced plans to compete in the casino business, there’s little doubt a Pamunkey casino would hurt the Colonial Downs Group and its parent company Peninsula Pacific Entertainment, which operate a horse racetrack in Richmond, and a chain of electronic horse-race-themed gaming emporiums.
“Colonial Downs hasn’t officially announced that they want to build a casino here. We only know that because we see their lobbyists in the general assembly pushing to give preference to somebody who has a physical presence in Richmond,” said Smith.
In a January statement, Colonial Downs said it “stands ready to compete with any entity for the opportunity to help Virginia expand its gaming platform and that consideration should be given to those with “proven track records.'”
Just two months before, a state-ordered study concluded that casinos would cut into Colonial Downs’ revenues and reduce its tax payment to the state by 45%. It also determined casinos would generate about $970 million in net gaming revenue and earn the state about $260 million in taxes.
The study also said nobody should get special treatment, and casino licenses should be awarded through a competitive selection process.
‘All isn’t lost’
Gambling hasn’t been legalized in Virginia—yet.
In 2019, Virginia lawmakers passed a bill authorizing gaming in five cities, including Richmond. But that bill contained a re-enactment clause, meaning it needs to pass in this year’s general assembly, which currently is in session. It is expected to issue a decision any time now.
The matter ultimately will be put to a referendum in November, however, giving voters final say about who should build the Richmond casino.
If the tribe doesn’t get the bid, all isn’t lost, according to Pamunkey spokesman Smith.
The tribe plans to apply to the Interior Department to place the land they’ve purchased into a trust, as it falls inside the boundaries of the Pamunkey’s ancestral holdings. This would allow the Pamunkey to open their own federally licensed casino, giving the state limited legal and regulatory authority over their gaming operations.
“We have extreme confidence that we would get a favorable quick review on our application, since most of the legwork was already done when we applied for federal recognition,” said Smith.
Then Richmond would have two casinos, he added.
