Rosie's Gaming Emporium has operated for five years in a former Kmart store on Midlothian Turnpike in South Richmond, more than 35 miles and a world away from the seat of government in
New Kent County . But half of the money "historical horse racing" machines generate in South Richmond ends up in New Kent County's treasury - $14.5 million in the past five years, including $3.7 million in the fiscal year that ended on June 30.
Customers play games at of Rosie’s Gaming Emporium in Richmond. It's a similar story for other Rosie's emporiums - owned by the company that also operates the
Colonial Downs horse track in New Kent and the fabled Churchill Downs track in Louisville, Ky. New Kent, as home to the horse track, also gets half of the local gaming proceeds Rosie's generates in Hampton, Vinton in Roanoke County, Collinsville in Henry County, Emporia, and Dumfries, a colonial port town on the Potomac River in Prince William County where
The Rose Gaming Resort just opened its doors.
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Altogether, the six "off-track" gaming emporiums sent $9.8 million in local gaming revenues they generated last year to New Kent. It also received $3.1 million produced by a Rosie's Gaming Emporium that operates at the Colonial Downs track in the county. Over the past five fiscal years, the county has received $12.6 million from the gaming parlor at Colonial Downs and $35.2 from just four Rosie's emporiums in Richmond, Hampton, Dumfries and Vinton for a total of $47.8 million. From calendar year 2019 through 2023, New Kent collected almost $42 million in gaming revenues compared with $12.5 million that Richmond received, according to the Virginia Racing Commission, which administers the funding. The money represents a payoff that New Kent County Administrator Rodney Hathaway says the county first earned 35 years ago, when it approved a racetrack to host live racing and help revive Virginia's horse industry. He said the county weathered the lean times, including five years when the horse track closed. Now, he said the fast-growing county is enjoying the benefits.
Customers play games at Rosie's Gaming Emporium in Vinton, a town in Roanoke County. Some Virginia legislators say it's time for that to change. "I've been getting a lot of heat from my district: 'Why do we have to continue to give New Kent County half of the revenues that we are generating?'"
House Appropriations Chairman Luke Torian , D-Prince William, told
Hathaway in a legislative work group hearing in September. "I can assure you that there will be a change, and New Kent needs to be prepared for that," Torian added. Torian and Sen. Lamont Bagby, D-Henrico, chairman of the Virginia Legislative Black Caucus, plan to introduce legislation in the upcoming General Assembly to alter the funding allocation. Torian hasn't said exactly how it proposes to change it, but Bagby said his goal is "the money generated in each locality remains in that locality." Changing the formula won't be easy because it would hurt New Kent, east of Richmond, which has come to depend on gaming proceeds, allowing it to pay for long-deferred needs, including those related to Colonial Downs, and keep its real estate tax rate relatively low. "The money has been essential to New Kent in meeting our capital needs," Hathaway said in an interview on Thursday.
New Kent's proceeds
New Kent has built two new fire stations with the gaming money and it is building an animal shelter. It plans to build a new water tower next to Colonial Downs to serve the track and local residences. The biggest use of the gaming money has been extending affordable internet access to all homes and businesses in New Kent, Hathaway said, with broadband now reaching 84% in an ongoing capital project with Cox Communications. The county has used most of the funding for capital projects, but the money also has allowed it to hire 18 firefighters and seven sheriff's deputies. New Kent grew by almost 12 percent from April 2020, through July 2023, the highest rate of population growth in the state, according to a report this year by the Weldon Cooper Center for Public Service at the University of Virginia. Now, the county has almost 27,000 residents and rising property values have put pressure on local real estate tax rates, Hathaway said. The county has lowered its real estate tax rate from 79 cents per $100 of assessed value in 2021 to 59 cents per $100 this year
, but Hathaway said the new rate is still 2 cents higher than the equalized rate that would have offset higher real estate assessments without a tax increase. Critics of the funding formula argue that gaming money from their localities is helping New Kent keep its property tax rate low. "New Kent is the fastest growing locality in the commonwealth and their tax base is not suffering," said Bagby, representing Richmond and Henrico. Hathaway told the assembly work group on Sept. 17: "In New Kent County, we placed our own bet on horse racing over 30 years ago. There were several times in that period - particularly when the track closed - when we questioned whether that was a wise bet or not. "But the bet our community made on horse racing is now paying off," he said. The funding formula dates to 1992, when the assembly approved the operation of initially up to six off-track betting sites, including one in western Henrico County. Colonial Downs now wants the Henrico site to house a Rosie's emporium to include 125 gaming terminals that operate on historical horse racing data. The formula remained when the state adopted legislation in 2018 to allow operation of historical horse racing terminals that look like slot machines. That decision enabled Colonial Downs to reopen the next year. It also opened the door to other forms of formerly illegal gaming, including casinos, under a 2020 law that expanded the number of historical horse racing terminals that could operate in some Rosie's emporiums, notably up to 1,650 at the one then planned in Dumfries - in eastern Prince William. Virginia allows up to 5,000 racing terminals statewide and about 4,500 terminals are operating now, including 804 in Richmond and 700 in Hampton.
Henrico proposal
Sen. Schuyler VanValkenburg, D-Henrico, opposes the attempt by Rosie's to establish a historical horse racing emporium in Henrico, based on a referendum for off-track betting in 1992, but he agrees that the funding allocation should change. "I don't think it's fair to the localities that approved the facilities," VanValkenburg said. Del. Betsy Carr, D-Richmond, who serves on the House budget committee, said, "Generally, my feeling is that horse racing in New Kent is an asset." "However, I think that the localities where the revenue is generated should be able to keep more," Carr added. New Kent's Hathaway acknowledged that the funding formula may need to change. "I think it's appropriate to look at the funding formula to see if it still makes sense," he said. "I have no gripes with the process." “The governor believes the first order of business is the creation of a common sense regulatory and oversight structure in the form of a gaming commission to holistically evaluate the numerous tax and policy issues before the legislature,” spokesman Christian Martinez said.
Money maker
Gaming on historical horse racing has been a money maker. Net gaming revenues reached $409 million in the last fiscal year, with more than $4.5 billion in wagers and $4 billion in payouts. A small portion of the money from wagers goes back to the localities and the state, as well as a fund for problem gambling and four state organizations supporting the equine industry. But New Kent, as home to the track, gets a cut twice as large as the other gaming parlors, including half of what they generate. Richmond, for example, has collected $14.5 million in gaming revenues from Rosie's over the last five years, but it's sent the same amount to New Kent under the formula. In the last fiscal year, the city and county evenly split the roughly $7.5 million generated at the Rosie's in South Richmond. "The city will support any proposal that would result in an increase in revenue for the city," Richmond Mayor Levar Stoney said Wednesday. The data the gaming terminals use is not specific to races at the track in New Kent, but defenders of the formula say the state would not have allowed them without live racing at Colonial Downs, which is tied by law to the number of machines allowed. "If you don't have the track with the racing days, you don't have any machines," said Senate Minority Leader Ryan McDougle, R-Hanover, a member of the Senate Finance & Appropriations Committee who now represents New Kent. "You can't have any of the off-track facilities if the track is not operational."
Racing days
The track has not come close to the 150 racing events once envisioned each year, but the racing commission on Tuesday approved a live-racing season with 44 events next year. That includes the Virginia Derby in March, representing the state's first qualifying race for the Kentucky Derby at Churchill Downs in early May. Hathaway, the county administrator, said New Kent bears a higher burden for providing public services to the track, especially on "premium" racing days. Colonial Downs pays for the cost of law enforcement, fire and emergency medical services at the track, but the events strain the county's ability to provide public services elsewhere. "It's not so much a money issue as it's a manpower issue," he said. The joint work group led by Torian and Senate Finance Chair Louise Lucas, D-Portsmouth, was supposed to release a report in mid-October but hasn't reached consensus on recommendations. McDougle and Del. Scott Wyatt, R-Hanover, both represent New Kent and serve on the six-member work group. Lucas, an outspoken advocate for expanded gaming options in Virginia, sat next to Torian during a public meeting on the funding allocation dispute in September, but said nothing. She said in recent days that she is waiting for recommendations from the Senate Finance and House Appropriations staffs before commenting. Michael Kelly, spokesman for The Colonial Downs Group, which operates Rosie's gaming emporiums, said, "That is purely a policy decision for the General Assembly." Bagby agreed that it will be up to the General Assembly to decide. "It's New Kent versus the rest of the commonwealth," he said. The grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. The grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers lined up as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. A security station was placed as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Brent Stevens of Colonial Downs Group spoke as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Phillip Harris of Rosie's Richmond general manager, spoke as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Phillip Harris of Rosie's Richmond general manager, raised his hand as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. From second left, Brent Stevens of Colonial Downs, Harris, Cynthia I. Newbille of Richmond City Council president, Sonya Shaw of Miles Jones Elementary principal and others attended the ribbon cutting ceremony. Adalyn Diaz of Richmond, left, and Evelyn Lopez of Richmond tried out a game as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Adalyn Diaz of Richmond tried out a game as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. A customer ordered his drink at the bar as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers ordered food at the dining area as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019.
PHOTOS: The grand opening of Rosie's Richmond Gaming Emporium
The grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. The grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers lined up as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. A security station was placed as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Brent Stevens of Colonial Downs Group spoke as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Phillip Harris of Rosie's Richmond general manager, spoke as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Phillip Harris of Rosie's Richmond general manager, raised his hand as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. From second left, Brent Stevens of Colonial Downs, Harris, Cynthia I. Newbille of Richmond City Council president, Sonya Shaw of Miles Jones Elementary principal and others attended the ribbon cutting ceremony. Adalyn Diaz of Richmond, left, and Evelyn Lopez of Richmond tried out a game as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Adalyn Diaz of Richmond tried out a game as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. A customer ordered his drink at the bar as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers played games as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019. Customers ordered food at the dining area as the grand opening of Rosie's Richmond Gaming Emporium was held on Midlothian Turnpike in Richmond on Monday, July 1, 2019.
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