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How a small central Virginia city has drawn attention, ire of major casino companies

| By Jill R. Dorson
There was a time when Petersburg, Virginia, was a key railway town, critical to the outcome of the Civil War. The North prevailed in taking the city in the centre of a state squeezed between North and South. One hundred and sixty years later, it is again at the center of a war, albeit this one over business turf.
cordish companies live proposal petersburg

Last Wednesday (24 April) the Petersburg City Council used a no-bid process to select the Cordish Companies to build and operate a casino. The decision came after years of back and forth about whether or not the citizens of Petersburg should even be granted the right to decide if they want a casino.

Tuesday (30 April) the union group UNITE NOW announced that it is prepping a lawsuit against the city. The group claims the city violated the state’s freedom of information act by having a closed-door session to select a casino partner.

“The City of Petersburg’s actions show a shocking disregard for the law and democratic norms,” Sam Epps, political director for UNITE HERE Local 25 said via press release. “Petersburg had begun a competitive RFP process that should have proceeded with transparency and fairness. Instead, City Council apparently abused a closed session to discuss the selection of the casino operator.”

The state legislature legalised retail and digital sports betting and five land-based casinos on 22 April 2020. But casino sites required local approval. In November 2020, voters in Bristol, Danville, Portsmouth and Norfolk approved casinos.

As of today, Caesars (Danville), Hard Rock (Bristol) and Rivers (Portsmouth) have deals. A fourth casino is also planned in Norfolk. This follows the city agreeing to a partnership between the Pamunkey Indian tribe and a commercial casino company. The idea was the tribe would buy the land and put it into trust. But that hasn’t happened yet and the city hasn’t approved any plans. If a casino licence isn’t awarded by 2025, then a new vote will be required.

Richmond voters didn’t go to the polls on the issue until 2021 and rejected a city-endorsed proposal from Urban One. Voters went back to the polls in 2023 and rejected the idea again.

Petersburg has been trying since 2022 for shot at a new Virginia casino

In between, Petersburg also threw its name in the hat. However, the re-vote in Richmond kept the legislature from giving Petersburg voters a chance to decide. At that time, Bally’s and the Cordish Companies were among those who submitted ideas for a Petersburg casino.

Two weeks ago, state lawmakers then amended the 2020 casino bill. This will allow the voters of Petersburg to decide if they want a casino. A referendum will now be held on the November ballot.

Even before getting approval to be on the ballot, Petersburg city leaders launched a Request for Proposal seeking a casino partner. Bally’s, the Cordish Companies, Penn Entertainment, Rush Street and the Warrenton Group in partnership with Delaware North submitted bids.

Each company presented its bid at a 14 April town-hall meeting. Ten days later, the city council met behind closed doors and subsequently announced a no-bid process, awarding the contract to Cordish. The company previously bid on the Richmond casino, but wasn’t selected.

City manager wrote, didn’t send letter to Bally’s over new Virginia Casino

After the presentations, according to the Virginia Mercury, city manager John Altman Jr signed a letter that awarded the contract for a new Virginia casino to Bally’s. The letter was never sent.

The Mercury reported that the letter said the city had plans to “move forward in the process of naming an operator with Bally’s”. City officials are now claiming the letter was written and signed under pressure from the general assembly.

According to a resolution cancelling the RFP process, “the letter of intent signed by the manager was never formally authorised by the city council; was not executed freely and voluntarily; and was not delivered to Bally’s but instead was signed and returned to the sender in response to a demand as a condition of allowing SB 628 to proceed.”

Petersburg’s city council cancelled a Casino RFP and selected the cordish companies in a no-bid process.

Was city threatened?

The letter was written on the same day that the general assembly was set to vote on whether or not to allow the Petersburg referendum. The idea that the city council selected Bally’s but ultimately went with the Cordish Companies outside of the RFP raises questions about the process. The initial law, however, does not require a bid process.

The text of the resolution says that two consulting companies recommended that the Cordish Companies be awarded the contract. It also says that the city manager received a letter of intent to move forward with Bally’s that included a “demand that the city sign the letter of intent or face the bill being voted down”. The resolution does not indicate who sent the letter, but is clear in saying that the city feared losing the opportunity to vote on whether or not to allow a casino.

There is clearly a new kind of war going on in and about Petersburg. In 1864-65, the Siege of Petersburg effectively ended the Civil War. The question today is who will win the turf war?

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