Before picking Cordish casino, Petersburg letter said city preferred Bally’s

A rendering shows the casino project Bally's envisioned for Petersburg. (Image courtesy of Bally's)

A week before the Petersburg City Council voted unanimously to pick Cordish Companies to potentially build a casino, City Manager John Altman Jr. signed a letter saying the city council intended to pick a competing company, according to a copy of the document obtained by The Virginia Mercury.

The April 17 letter of intent addressed to Bally’s, a national casino company that was one of five finalists for the Petersburg project, said the pending deal would still depend on outside factors. However, the letter clearly indicated Bally’s was the city’s initial choice, saying the city intended to “move forward in the process of naming an operator with Bally’s.”

The city claims the letter was signed under duress as the General Assembly pressured local officials to pick a certain casino company or risk losing the project entirely. On April 17, lawmakers were in Richmond preparing to vote on a bill giving Petersburg permission to host a casino. 

An unfavorable vote on that bill could have killed the project, and Petersburg officials claim they were told the legislation could be blocked if the Bally’s letter wasn’t signed.

The letter was addressed to Bally’s Senior Vice President Christopher Jewett. But it was never sent to him.

The document raises major new questions about the process Petersburg followed in picking a developer to partner with for a project the city has described as “the largest economic development and tourism project in the city’s history.” 

When Virginia authorized casinos in 2020, lawmakers chose not to require a strict competitive bidding process and instead allowed a few select cities to hand pick companies they wanted to partner with to build casinos. 

In Petersburg, the process has sowed severe confusion about the city’s intentions and whether outside forces were pushing local officials to partner with a particular casino developer. The city put out a request for proposals and held a public town hall featuring presentations from the five finalists, but the City Council voted unanimously Wednesday to “cancel” the competitive process and select Cordish as the winner. 

When asked for an explanation of the letter, Petersburg spokeswoman Joanne Williams sent the Mercury what she said was the full text of a resolution the City Council approved unanimously Wednesday night.

That document claims the city was given the letter on April 16 with a demand that it be signed or else the General Assembly would block legislation allowing Petersburg to pursue a casino. 

The letter was not signed “freely and voluntarily,” the resolution says, and was only “returned to the sender.” Altman only signed the letter, the resolution says, “to enable the bill to continue in the General Assembly.”

“[A] letter of intent was received by the City Manager’s Office to proceed with Bally’s as the City’s preferred casino gaming operator with a demand that the City sign the letter of intent or face the bill being voted down or indefinitely tabled,” the council resolution says.

The resolution goes on to say that Petersburg’s legal counsel always “questioned the propriety” of using an RFP process to select a casino operator.

The resolution doesn’t identify who asked the city to sign the letter. Sen. Lashrecse Aird, D-Petersburg, was the sponsor of the bill authorizing the Petersburg casino and has served as a conduit between the city and the legislature. Aird didn’t respond to requests for comment Thursday.

Jewett, the Bally’s executive, told the Mercury he never received the document, which appears to be written on official letterhead from the city manager’s office.

“These reports are the first we are hearing of this,” Jewett said. “We were recently contacted by the city and their advisors with questions about our project which we are in the process of responding to until we hear differently.”

A signature line for Jewett on the letter was blank. An adjacent line for Altman includes the city manager’s signature dated April 17.

The General Assembly vote last week went in Petersburg’s favor as lawmakers removed a provision in a bill authorizing the casino that would have required the state to reapprove the plan next year or at a special session later this year. 

It’s unclear whether the Bally’s letter was shown to decision-makers in Richmond to influence that vote and cement Petersburg’s status as an eligible casino city, but rumors of the letter’s existence have been swirling at the state Capitol over the past week.

There appeared to be some angst in the General Assembly over whether Petersburg truly intended to entertain multiple bids for the project or if the city was planning to select Cordish again after picking Cordish for an earlier, failed attempt at a casino in 2022. 

Unite Here — a hospitality workers’ union that has advocated for the Petersburg casino project and endorsed Aird last year in her primary bid to unseat former Sen. Joe Morrissey — isn’t on good terms with Cordish. In 2023, the union said Morrissey “sold workers down the river when he gave away Petersburg’s casino to Cordish Companies without any public commitment to good jobs,” according to the Richmond Times-Dispatch.

“Lashrecse Aird, in contrast, wants to bring good development to Petersburg that benefits workers and residents alike,” the union’s 2023 statement continued.

Unite Here, which says it represents 100,000 casino workers in the United States and Canada, has a better working relationship with Bally’s. The company listed Unite Here’s logo in its public presentation of its plans for Petersburg to underscore its relationships with organized labor.

In an April 14 letter to the Petersburg City Council, the city manager, Aird, House Speaker Don Scott, D-Portsmouth and Sen. Louise Lucas, D-Portsmouth, the union said it had a “labor peace agreement” with Bally’s. The union also had deals with several other bidders, but not Cordish.

Petersburg’s letter three days later indicating Bally’s would be the pick says the decision would depend on continued negotiations between the two parties and the Virginia Lottery, which vets the finances and backgrounds of would-be casino operators, signing off on the deal.

Whatever the reason was for Petersburg indicating it was going with Bally’s a week ago, the city appears fully committed to Cordish.

In a statement released Thursday evening by Cordish and Bruce Smith Enterprise, the development company owned by the NFL Hall of Famer, Petersburg Mayor Sam Parham said the city was “thrilled” to have picked a partner “after a thorough RFP process and extensive review by outside consultants.”

“Bruce Smith and Cordish’s experience, comprehensive project master plan and visionary approach, ideal site location, robust financial strength and commitment to swift market entry make them the clear and unanimous choice of both our consultants and City Council,” Parham said.

The letter indicating Bally’s was the top pick also pointed to “financial assessments” of the casino bids conducted for Petersburg by the Davenport consulting firm. On Wednesday, Petersburg Council Member W. Harold Myers said Davenport’s conclusions were the basis for the council’s decision to select Cordish.

The report Davenport issued to Petersburg ranked the Cordish proposal first based on “financial stability and likelihood of funding,” “overall development and investment in the city” and “guaranteed payments up front and over time.”

The report, dated Wednesday, also suggested the city should ask follow-up questions to Cordish, Bally’s and Rush Street Gaming before Davenport could provide “a firm and final recommendation to the city.”

This story was updated after publication to include new information about the Davenport report.

The post Before picking Cordish casino, Petersburg letter said city preferred Bally’s appeared first on Virginia Mercury.