Category Archives: Economic development

Virginia Democrats’ Minimum Wage Bill Would Wipe Out Jobs, Especially During Recessions

from Liberty Unyielding 

The Democratic leaders in both houses of Virginia’s legislature have just introduced legislation that would raise the Virginia minimum wage from $12 to $15. The bill also retains provisions that make the minimum wage rise with inflation, while preventing it from ever falling due to deflation. As a result, it could rise further in real terms in the future. This minimum wage increase and further increases in the future could lead to a big spike in unemployment in the next recession.

In a deep recession, prices may fall due to deflation, resulting in a dollar of wages being worth more than it was before. If employers can’t adjust wages to match those falling prices, they may have to lay off many more of their employees, because employers cannot afford to pay rising real wages at a time when the demand for their product is shrinking due to the recession. As Jason Lennard noted in the European Review of Economic History, “In the ‘deflationary vortex’ of the 1930s… sticky nominal wages translated to rising real wages, which resulted in mass unemployment.” Moreover, “minimum wage legislation may have contributed to stickiness by preventing nominal wages from falling.”

Continue reading

More Bad News for the Governor

Yesterday was a bad day for Gov. Glenn Youngkin.  In addition to having to absorb the news about losing both houses of the General Assembly to the Democrats, he learned that the federal General Services Administration has decided to locate the long-coveted new FBI headquarters in Maryland rather than Virginia.  That was bad news for the Commonwealth as a whole, as well.

Casino’s Last Stand: A Nauseating Display of Hate

Downtown Richmond

by Jon Baliles

The second casino referendum will be decided on Tuesday and it will be a vote (again) on whether or not Richmond wants to do the get-rich-quick schemes to help people or do the hard work of methodically mapping out a strategy and building a future. The get-rich-quick schemes like the casino and Navy Hill only benefit the select few, but the promoters promise the world to everyone and benevolence as far as the eye can see — vote for it and approve it for YOUR benefit, they say. It will be better FOR YOU than it will be for us, they boast.

We called B.S. on Navy Hill and we need to do it again with the casino, which will be a predatory drain on the community and do more harm than good, despite what they promise. And this will not be a policy wonky dive into the casino, I promise. That’s because this issue is sadly a nauseating reveal of what the casino developers really think about Richmond and Richmonders, told in their own words.

News came out this week that the promoters of the casino have been going on radio in recent days and trashing everyone in Richmond that does not support the casino. They have spent more than $10 million to try and convince people to vote for it, but they are badmouthing and trashing opponents on their own radio stations for all to hear with vile and offensive an inexcusable comments demeaning people of all kinds — black and white; the rich, middle class and poor; churchgoers, pastors. It did not matter. It was open season on anyone who didn’t support the casino; they especially went after Jim Ukrop and they absolutely thrash Tim Kaine because he voted no in 2021 and said there were better ways to promote economic development in Southside. Continue reading

Virginia Set to Help Taxpayers for a Change

from The Republican Standard

Good news for Virginia taxpayers.

In the coming weeks, several hundred dollars are heading back into the pockets of eligible Virginians. Up to $400 per household will be heading to mailboxes and bank accounts across the Commonwealth thanks to a surplus in the state budget recently signed by Governor Glenn Youngkin.

In a media release issued by his office last week, Governor Youngkin stated.

“As Virginians continue to face inflation and high prices as a direct result of policies out of Washington, D.C., these rebates are an important step going into the holiday season to help Virginians keep more of their hard-earned money for gas, groceries, and essentials.”

NBC4Washington also noted that “the taxation department has an online lookup tool where taxpayers can go to see if they’ll receive a rebate.”

If you enjoy having more control over your own dollars, don’t forget to think about the benefits of having leaders in the state that value the taxpayers as you head to cast your ballot in the state and local elections this year.

Republished with permission from The Republican Standard. 

Resorts Like Airports

by Jon Baliles

There has been a lot of boasting from the casino advocates about their partnership with Kentucky-based Churchill Downs, Inc. (CDI). The rebranded Richmond Grand casino developer Urban One is a radio and TV conglomerate that has said they are partnering with CDI because of their huge capitalization and experience with casinos. But let’s take a look at Churchill Downs’ casino portfolio, because it’s not what the casino advocates have been claiming.

CDI is obviously world-famous for the running of the Kentucky Derby horse race, and they have expanded their portfolio to include more and more gaming facilities in recent years. CDI bought out Peninsula Pacific Entertainment (PPE) in a $2.75 billion deal in 2022, and PPE had been Urban One’s original partner in the first, failed casino referendum. The deal included the Colonial Downs Racetrack in New Kent, as well as six Rosie’s Gaming Emporium historical horse racing facilities across Virginia plus two smaller casinos, one in Iowa and one in New York. But among the eleven casinos in the CDI portfolio, none are anywhere near the scale what they promise for Richmond. And none of those eleven casinos resemble anything grand — except for the indisputable fact that the house always wins, even if the resort looks more like an airport.

The Richmond Grand advocates claim their casino will have a 250-room hotel, an entertainment/concert venue with 3,000 seats, a TV and film production soundstage, and 15 restaurants and “dining options.” But if you look at their other casinos, they are all small casinos in small markets and are not even close to the “resort” they claim to be bringing to Richmond. Continue reading

Deep Dive: Casinos, Highways, and Ignoring RVA Voters

Downtown Richmond

by Jon Baliles

Republished with permission from RVA 5×5.

They say the past is prologue and that if you don’t learn from history, you are doomed to repeat it, among other famous quotes that have stood the test of time. And they have a factor of truth and lesson in them. And so is the case with next month’s casino referendum, the second one we have had the chance to vote for because the first one was ignored by city leaders in 2021.

This Deep Dive is a look back at the last time Richmond faced two referendums on one topic in short succession — the people were asked to vote to register their voice and they said no to the city leaders, planners, and business leaders. Both times, the people’s voice was ignored, and both times the city leaders overruled their vote and their voice and pursued their plans irrespective of the results — with disastrous and long-lasting consequences.

This may be starting to sound familiar. Continue reading

Incapable at Least; Incompetent at Worst

by Jon Baliles

The Richmond casino referendum this week was once again in the forefront of the news but not because of the impending vote or the discussion of the numerous proposed “benefits” the casino advocates have promised every group under the sun. No, this week it was made known that the company driving the effort to approve the casino referendum (again) is facing the possibility of being delisted by NASDAQ.

Nevertheless, the casino advocates assure all of the potential voters that they will be able to pay the city the $26 million up front payment within 30 days of the approval of the referendum (as spelled out in the agreement), AND build their proposed $562 million casino, AND provide $30 million to the city tax coffers every year from here to eternity, AND still pay off all the organizations and groups and investors they are promising largesse to win approval of the second casino referendum.

No promise is too big, no cost is too high, and no vote is too expensive. Continue reading

Whose Water Is It?

The Rappahannock River. Photo credit: Va. Dept. of Conservation and Recreation

by Dick Hall-Sizemore

There are some issues that seem to be baked into public policy and, because they affect sensitive and important areas, tend to lead to controversies periodically.

Many years ago, one of the hottest controversies was the “inter-basin transfer of water.” Because Virginia is a “riparian rights” state, folks who live next to rivers can withdraw water from the river, but are not supposed to divert it to use by other people who do not live on the river. To do so would diminish the water available for those other riparian landowners. The Virginia Supreme Court in the 1942 case of Town of Purcellville v. Potts declared a per se prohibition against inter-basin transfer:

While a riparian owner is entitled to a reasonable use of the water, he has no right to divert it for use beyond his riparian land, and any such diversion and use is an infringement on the rights of the lower riparian proprietors who are thereby deprived of the flow. Such a diversion is an extraordinary and not a reasonable use.

The field of water law is a very complex one and that is as far as I am willing to dip my toe into it. Suffice it to say that inter-basin transfer of water is an important concept. For a more in-depth discussion, see here. Continue reading

“Blessed“ Is the Second RVA Casino Referendum

by Jon Baliles

Early voting has begin in Virginia and the Richmond casino advocates have gone all-in with the mayor and City Council to make sure the referendum got back on the ballot and now are betting the house with an absurd amount of money to make sure the referendum passes this time.

Jimmy Cloutier at Virginia Investigative Journalism has an interesting piece on the all out effort by the casino advocates to buy their way to a victory at the polls  this time around. He points out that two out-of-state companies (Urban One, based in Maryland and Churchill Downs, based in Kentucky) have already raised $8.1 million which “dwarfs the amount of money raised in every Virginia legislative race and ballot initiative in state history, according to an analysis of campaign finance data by OpenSecrets.” Continue reading

Virginia’s “Runaway” Budget Negotiators

by Derrick A. Max

(This column was first published by the Thomas Jefferson Institute for Public Policy)

Fear of commitment is a common theme in Hollywood — where romantic comedies are replete with characters that sidestep long-term commitment primarily out of fear that someone better may come along. Think of Runaway Bride, where Maggie, played by Julia Roberts, keeps running away from her betrothed at the altar out of such fear.

The budget amendments passed last Wednesday with bipartisan support and praise from Governor Youngkin are replete with commitment issues. The approved tax cuts and new spending were written to have very little impact beyond the current budget cycle. Like Maggie, both Governor Youngkin and the Senate Democrats are clearly standing at the budget altar hoping for better options after the November elections. Continue reading

Short Term Rentals — Long Term Impact

by Jon Balilies 

The City of Richmond has been discussing altering and revising regulations about short-term rentals (STR’s) and the next action will take place at the Planning Commission meeting on Tuesday afternoon (September 5th). It is an important decision because it is entirely possible the decision by the Commission and ultimately City Council could have a tremendous impact on housing availability, high sale prices, and neighborhood character.

For the last few years, the city has done a good job of holding public meetings and soliciting feedback through various methods and gathering information about short-term rental properties (like AirBnB and VRBO, etc.). Until 2020, they were technically illegal and unregulated but they did exist (they rose to a more visible status when the UCI 2015 Bike Championships came to town).

In gathering information and developing the first ordinance, the city said it wanted to find the right balance to allow property owners to take part, but also make sure it was done right to protect neighborhoods. Some other cities dove in head-first with few, if any, regulations, which led to adverse, if somewhat predictable, effects. Richmond smartly agreed to revisit the ordinance after having some time to evaluate the initial regulations. Currently, in residentially zoned areas, the city requires that owners must claim primary residence at least 185 days (just over half the year) to rent out as a STR. If the property owner has a converted garage, etc., then they may rent that out all year. In commercially- zoned areas, there is no residency requirement being proposed in the new legislation. Continue reading

Virginia Has Lost Its Mojo — Appalachia Edition

A new report, “The Future of Appalachia,” outlines economic development strategies for one of the most intractably poor regions in the country. Drawing a distinction between “southern” and “northern” Appalachia, the study observes that southern Appalachia has achieved far more economic success than its northern counterpart. Unfortunately, for purposes of this analysis, Virginia is deemed part of “northern” Appalachia.

The difference in dynamism can be seen in the map above, which shows net in-migration between 2021 and 2022. Each dot represents 100 people. The mountains of Tennessee, North Carolina, South Carolina, Georgia and Alabama are experiencing significant in-migration — Virginia, West Virginia, and Kentucky almost none.

Alas, I do not have the time to explore this study in any detail. I’ll settle for filing this under, “Virginia has lost its mojo.” I invite readers to dip into the study and report their observations. — JAB

Schools Shouldn’t Open Before Labor Day

Oceanfront, Virginia Beach. Photo credit: Kerry Dougherty

by Kerry Dougherty

Better sit down, youngsters. Did you know you’ll only get OUT of school two days earlier than last year? Yep, your last day of classes is June 14, 2024. Last June you finished up on June 16th.

Joke’s on you. Oh, and the teachers who pushed for the new schedule believing they’d get an early start on summer.

Until 2019, Virginia’s public schools were prohibited from beginning before Labor Day. The law, nicknamed the “Kings Dominion Relief Act” was passed in 1986 to boost Virginia’s tourism industry, giving teens with summer jobs a chance to work through the traditional end of summer. Continue reading

Virginia Beach’s Bad Habit: Reckless Spending on Wasteful Projects

by Kerry Dougherty

Feckless leadership, wasteful spending and escalating taxes have plagued Virginia Beach for decades.

Despite new faces on city council, the game of spending tax dollars on insane projects that “will pay for themselves” continues.

But let’s back up.

Here’s one prescient story from The Virginian-Pilot in 2007. The headline: “Virginia Beach Sportsplex Misses Its Goal” soft pedaled what was going on. It was yet another pricey project, dreamed up by developers and approved by their political puppets.

And it was failing. Continue reading

How Did VCU Miss the Red Flags?

by Jon Baliles

The unravelling saga of a failed development proposal downtown a block from City Hall that was supposed to rise out of the ashes of the failed Navy Hill project is still smoldering. The failed deal has come with a price tag of about $80 million so far (and growing) for VCU Health. They were supposed to be the main tenant of the project and, by all accounts, approved and signed a deal in July 2021 in which VCU accepted heavily one-sided terms that have become so expensive it could still ripple throughout the city, the university, and the state.

Eric Kolenich has peeled back the latest layer of the onion in an eye-popping article in the Times-Dispatch this week, with emails that revealed grave concerns with the deal that would leave VCU Health holding the bag, and also emails that showed more concern to close the deal than what was in it. The emails show both bad communication and miscommunication among those at top levels of VCU’s administration at both the Monroe Park campus and the medical campus. They were sent in a flurry in the weeks leading up to VCU inking and approving the deal, and ignored warnings that were raised in favor of a closer analysis or alternative parachutes that would offer a way out.

After the Navy Hill project failed in early 2020, Capital City Partners, the developers who led that attempt, returned to the city with a proposal for a development for the city’s dilapidated old Public Safety Building at 500 N. 10th Street (aka the Clay Street Project because it is at 10th & Clay Streets). The proposal was for a 17-20 story building that would be leased by VCU Health for office use. They would pay $650 million in rent over 25 years that would produce close to $60 million in tax revenue for the city.

VCU would have to pay rent starting in 2024, whether or not the building was completed, as well as pay for repairs and maintenance. If the project faced cost overruns, VCU would also be on the hook for those.  And strangely, since it was office space, it would not generate any revenue for VCU Health like other facilities they had recently built (e.g. the Children’s Hospital). Continue reading