Norfolk Reconsidering Casino Development Partners After Existing Plans Stall

Written By Nikhil Kalro on April 15, 2024
Hand with thumbs down represents Norfolk rejecting Headwaters Resort and Casino development plan

Norfolk city leaders are considering changing casino developers after plans with the city’s existing partner stalled. With Norfolk facing a gaming license deadline in 2025, the city has expressed its displeasure at not having received a formal plan for review since July 2023.

The Pamunkey Indian Tribe, along with financial partner Golden Eagle Consulting LLC, was asked in July to redesign plans for the HeadWaters Resort and Casino. Those initial plans, which included a two-phase construction process for the Virginia casino and adjacent resort, were rejected.

Norfolk city leaders not shy about looking elsewhere for casino developer

“We’re working with Golden Eagle and will have a casino with them, and if they don’t perform, we will have somebody take their place,” Norfolk City Attorney Bernard Pishko said. “We’re starting to get ready in the event that they run out of time. You can always second-guess whether you’ve done enough, but there was nothing obvious we could ask for” besides the building plans.

After voters approved a referendum in 2020 allowing a casino to be built, the city was given a five-year deadline to obtain a gaming license. If it doesn’t, another referendum will be required. Norfolk has an options agreement with HeadWaters developers that would allow the city to find a new partner if their performance doesn’t meet its expectations.

“While this Option Agreement is in effect, the City will neither negotiate nor enter into any contract for the sale of, or any option contract for the sale of, any portion of the Land or improvements thereon that is superior to the rights of GEC and the Tribe,” the agreement states.

Concerns about Pamunkey tribe’s partnership with casino

There are several concerns around the Pamunkey tribe’s partnership with a casino, including that the development agreement signed in 2020 explicitly prohibits the tribe from then placing the land in a federal trust. Former Chief Kevin Brown said,

“I’m sure the chief and the council know what’s going on, but they’re not being completely open with the rest of the tribe. The casino applicants have also not provided information about the conditions of the deal between the tribe and (gaming industry billionaire Jon) Yarborough or said whether tribal members would be allowed to view it or vote on it. Under IGRA (the Indian Gaming Regulatory Act), there’s a lot of safeguards for tribes, but you jump into the commercial world, there’s no safeguards for tribes. So that’s what I’m worried about.”

Will the 2025 deadline be extended?

There is a significant appetite for betting and gambling in Virginia. According to a report from the Joint Legislative Audit and Review Commission released in 2022, wagering in the state has tripled since 2018. But tribes in Virginia and elsewhere have been reluctant to venture outside of the IGRA when it comes to gaming.

“We haven’t reached that tipping point in any market in the USA,” said Steven Light, a professor at the University of North Dakota Institute for the Study of Tribal Gaming Law and Policy.

“Only in recent years do you see some tribes with the willingness and the wherewithal to step totally outside of the IGRA framework and not worry about having land in trust and not worry about the protections that come from having a tribal-state compact, but instead operate like a commercial operator only under state law and paying state taxes,” Light said.

Several lawmakers think it may be time to reconsider whether there is enough time for the Pamunkey tribe to provide the building plans Norfolk needs to obtain a gaming license before the 2025 deadline.

“If it looks like both parties are moving ahead in good faith, I would support that,” Delegate Barry Knight said. “I don’t want to hurt, first and foremost, the Pamunkey Indian Tribe. My first loyalty is to them. My second loyalty is to the state of Virginia on the tax revenue and the oversight to help the Indians help themselves. And my third loyalty is to Norfolk, and if all three of them can win in this situation, we are all going to be happy.”

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Nikhil Kalro

Nikhil Kalro is a sports betting and online gambling writer who contributes content on regional sites. Kalro applies his interest in strategy and mathematics to sports writing and other gambling topics. Nikhil’s previous experience includes working with ESPN for five years. Among his specializations are soccer, football, basketball, tennis and esports betting.

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