Virginia Senate Approves iGaming Bill With 2027 Start

Virginia lawmakers have advanced legislation that would authorize online casino gaming, approving Senate Bill 118 after a closely divided vote. On Feb. 16, the Senate first rejected the proposal 19-20, then reconsidered it later that day and passed it 19-17, highlighting divisions over digital gambling expansion.

A late amendment added before final passage delays implementation until July 1, 2027. Online casino operations would not begin immediately even if the House and governor approve the measure.

Framework for Regulation and Revenue

SB 118 places oversight of online casino activity under the Virginia Lottery. Eligibility for operator licences would remain limited to the state’s five existing land-based casino operators. Each would pay a $500,000 initial licence fee covering a five-year term, followed by a $250,000 renewal. The legislation permits up to three online platforms per operator, with each platform subject to a $2 million fee.

The bill imposes a 20% tax on adjusted gross iGaming revenue and adds a separate 6% economic development fee. Lawmakers directed 95% of the 20% tax to the Modern Public Education Fund, with 3% allocated to the Gaming Regulatory Fund and 2% to the Problem Gambling Treatment and Support Fund.

Revenue generated from the 6% fee would flow into a Casino Gaming Hold Harmless Fund. Lawmakers designed that fund to offset potential revenue losses at physical casinos located in Bristol, Danville, Norfolk, Portsmouth, and Petersburg. The five properties would receive equal distributions through July 1, 2032. After that date, operators must demonstrate revenue declines tied to online gaming to qualify for payments.

Under the timeline included in the Senate-amended bill, the Virginia Lottery would finalize regulations by Jan. 1, 2027. The authorization would take effect July 1, 2027, making fiscal year 2028 the first projected revenue year.

Estimates presented during review project $343 million in total state revenue during FY28, with annual revenue exceeding $1 billion by FY32. Analysts also forecast that mature net iGaming revenue could reach $3.56 billion by FY31.

Concerns Over Lottery Impact and Social Effects

Fiscal analyses also point to potential declines in Virginia’s iLottery revenue. Projections indicate a 25.5% drop in iLottery revenue during FY28, with declines reaching 53% below projected levels by FY32. The Department of Planning and Budget estimated annual iLottery profit reductions between $77 million and $163 million. The Lottery could incur approximately $1.16 million per year in additional staffing costs beginning in FY28.

Supporters have framed the measure as a regulatory step. On the Senate floor, Sen. Mamie Locke said the bill would “legalize iGaming in the Commonwealth of Virginia and dramatically curtail Virginia’s thriving illegal iGaming market.”

Opponents have focused on addiction risks and access through mobile devices. During debate, Sen. Bill Stanley stated: “We are being asked to take the single most addictive device in human history, the smartphone … and now we’re being asked to put a slot machine on it, let that sink in for a moment.”

SB 118 now moves to the House of Delegates, where lawmakers are considering HB 161, a proposal requiring approval in two consecutive sessions. The chambers must reconcile differences before any online casino market can launch.

Source:

“Virginia Senate Advances iGaming Bill With 2027 Timeline”, news.worldcasinodirectory.com, February 17, 2026