The city of Danville expects to bring in $25 million in revenue during its next fiscal year from Caesars, which currently operates a temporary casino in the city and plans to open a full casino resort by the end of 2024.
About $16.3 million of this total is expected from state-collected gaming tax revenue, and the other $8.7 million is the local supplement that Caesars Virginia agreed to pay the city as part of its development agreement. The minimum local supplement that Caesars must pay Danville each year is $5 million.
Danville will use only this $5 million for ongoing expenses, said City Manager Ken Larking at a briefing Tuesday where he presented the city’s proposed budget. These expenses include pay performance increases for city employees and increased health insurance costs for city and school system employees.
The remaining $20 million in revenue is expected, but not guaranteed, he said.
“The thought is that if, for whatever reason, that $20 million didn’t come in, tough decisions would still have to be made, but it wouldn’t affect core services,” Larking said.
Larking’s proposed budget recommends using this $20 million of gaming-related revenue to pay for a variety of projects across the city, including:
- About $7.8 million in capital and special projects.
- About $5.2 million for economic development initiatives.
- $2 million to put in a reserve for a future balloon payment on an Industrial Development Authority loan, which was used to finance economic development projects in previous years in anticipation of future casino revenues.
- About $1.5 million for lease and debt payments associated with the new police headquarters.
- About $1.2 million for Danville Public Schools for school bus aides, elementary school security and early tuition costs.
- $788,800 for the city’s tourism marketing program.
- $700,000 for the removal of blight.
- About $526,000 for gang prevention efforts, which were previously funded mostly by grants.
- About $91,000 to pay for a grant administrator.
- About $98,000 to pay for new park maintenance positions, which will be necessary to maintain the Riverfront Park that is under construction.
- And $40,000 for the summer internship program.
Larking provided a breakdown of the funding for the two big-ticket items in that list: capital and special projects and economic development initiatives.
The $7.8 million recommended for capital and special projects will go toward initiatives like public safety information technology, fire department building improvements, City Hall renovations, a city zoning and development code update, police equipment and signage.
The budget also includes $9.3 million for improvements at the Danville Regional Airport, $160,000 of which will come from casino revenue.
The $5.2 million recommended for economic development initiatives will go toward River District property purchases and improvements, incentives, site development, development of the Schoolfield corridor and internal recruitment.
These suggestions align with the recommendations of the Investing in Danville Committee, which is composed of residents, stakeholders and community leaders. It was created before the temporary casino opened to guide the city on how to spend gaming revenue.
“Each of those is important for us to continue growth within our community,” Larking said at the briefing.
A report that he prepared for the Danville City Council referenced the growth that the city is experiencing for the first time in many years.
Despite the growth, however, the city has not yet reached all its goals, the report says. And there were difficult decisions to make in creating this budget, Larking said at the briefing.
There were about $70 million worth of requests for capital projects, and only about $30 million available, he said.
“A lot of stuff has to be deferred to some future year,” he said. “And even though we do have additional revenue coming in through casino revenue, we have to be thoughtful about how we use the funds.”
The total proposed budget for the next fiscal year is nearly $348 million, which is an increase of 7%, or $22.7 million, from the previous budget.
In addition to the casino revenue, the major revenue increases in the proposed budget include a $3.2 million increase in real estate tax revenue and a $1.8 million increase in personal property tax revenue.
Larking emphasized the impact that revitalizing River District buildings has had on increasing revenue.
“The increase in annual revenue from what we were receiving for buildings that were often blighted is now half a million dollars per year, because of the increased value for those properties,” he said.
The overall theme of the proposed budget is “Investing in our Youth,” which is a continuation of last year’s theme. This goes hand-in-hand with the city’s recent rebranding, which emphasizes the importance of making Danville a place that people want to live and work, Larking said.
“We want to continue to make the right kinds of investments in our community so that people, whether they live here now or are considering living here, and businesses, whether they are here now or considering moving here, can call Danville home,” he said.
This especially pertains to the young folks in the community, Larking added, saying that the city wants to make sure there is enough economic opportunity for young people to consider staying in Danville after high school or moving back after college.
“We are in a global competition for talent, a global competition for people,” Larking said. “If we’re not keeping up with those kinds of things that people are looking for in a community, then we’re going to lose. The best thing we can do for our young people is to make Danville a place that they would want to come back home to.”
The city council will review Larking’s proposed budget and create its budget, which will be shared with the public April 30. Then, there will be a period for public input before a final budget is adopted by June 30.
