Virginia Senate Approves iGaming Bill After Voting Drama

• Virginia Senators approved SB 118 this week
• Senators originally voted the bill down, but reconsidered and approved the legislation
• SB 118 legalizes iGaming in state

Sure there was a little drama, but Virginia Senators ultimately approved SB 118, a bill to legalize iGaming in the Old Dominion State, after second reconsideration.

Members of the Virginia Senate approved SB 118 by a 19-17 vote Monday, but the legislation passage was not a smooth one. The Senate originally defeated the bill by a 19-20 vote earlier in the day, but unanimously approved a reconsideration of the defeated bill and ultimately passed the legislation.

Sen. Mamie E. Locke’s (D-23) bill now heads to the Virginia House, where a companion bill will likely be considered today.

Bill Receives Second Life

Locke’s bill originally suffered a 19-20 defeat on third reading in the Senate Monday morning, but received a second life later in the day after Sen. Schuyler VanValkenburg (D-72) made a motion to reconsider. The bill received unanimous approved for reconsideration after its initial defeat.

During the second reconsideration, Sens. Bill DeSteph (R-20), Stella Pekarsky (D-36), and VanValkenburg all declined to vote on the bill after voting against it in the earlier motion. The bill ended up passing on third reading by a 19-17 margin.

“SB 118 will legalize iGaming in the commonwealth of Virginia and dramatically curtail Virginia’s thriving illegal iGaming market and generate upwards of $14 billion in new taxable revenue over the first five years. Also, tens of billions of dollars every subsequent five years in perpetuity. iGaming has already generated billions of dollars in markets in Pennsylvania, New Jersey, West Virginia, and Michigan,” Locke said.

The Senate approval mirrored the bill’s earlier subcommittee approval, where it was initially voted down by a 3-4 margin. However, after receiving additional responsible gaming measures, the bill was reconsidered and passed.

The bill now heads to the Virginia House of Representatives, where its companion bill, HB 161, will likely be considered today in the House Appropriations Committee. Today is the final day in the Virginia legislative session when bill can be approved to cross over into another regulatory body.

Senate iGaming Bill Details

Locke’s bill will allow each of the state’s current three land-based casinos to offer iGaming through partnerships with online iGaming operators. Casino gaming operators will be able to partner with up to three iGaming operators to conduct iGaming in the state through an initial $2 million platform fee. Additionally, approved iGaming operators will be required to pay a $500,000 initial licensing fee.

Locke’s legislation allows for iGaming licenses to be valid for five years, upon which both casino gaming operators and iGaming operators will be able to renew licenses at half their initial fee ($1 million for a casino gaming operator and $250,000 for an iGaming operator).

Two new brick-and-mortar casinos are slated to open in the state in 2026 and will be eligible to offer iGaming if approved.

The bill authorizes the state’s iGaming tax rate at 15% of an operator’s adjusted gross gaming revenue. The legislation earmarks 5% of revenues allocated to the state’s Problem Gambling Treatment Fund, 6% allocated to the iGaming Hold Harmless Fund until Jan. 1, 2030, and the remaining 89% before Jan. 1, 2030, and 95% after Jan. 1, 2030, allocated to Virginia’s general fund.

The bill also sets civil penalties for individuals operating unlicensed iGaming and sweepstakes in the state. The legislation notes the following will be unlawful:

“Except if conducted by a licensed internet gaming operator, offering or conducting a sweepstakes in which a person present in the Commonwealth may participate by paying or proffering something of value, including an entry fee for the opportunity to win or receive cash or a cash equivalent, shall constitute illegal internet gaming in violation of this section, and shall subject the operator or sponsor, or any officer, employee, or agent of the operator or sponsor, to civil liability under this section.”

Any person or operator who violates this law may be liable for a civil penalty of not more than $100,000 for the first offense, $250,000 for the second and each subsequent offense. Each day in which a violation occurs will be considered as a separate offense.