Virginia iGaming Effort Dies for 2026 as DFS, Skill Gaming and Fairfax Casino Bills Advance
Photo by Kellie Shannon on Unsplash
Virginia’s push to legalize online casinos has officially collapsed for 2026 after lawmakers failed to reconcile on competing bills before the legislative session adjourned on March 14. Meanwhile, the legislature passed legislation on daily fantasy sports (DFS), skill game regulation, and a Fairfax County casino referendum, all of which now head to the governor’s desk.
Conference Breakdown Ends iGaming Push
Despite gaining momentum in both chambers, lawmakers failed to agree on Senate Bill 118 and House Bill 161 during conference committee negotiations.
Both the House and Senate had passed their respective iGaming bills. Both bills allowed each of the state’s land-based casinos to obtain iGaming licenses and partner with up to three operators. The framework included a $2 million platform fee, a $500,000 initial licensing fee per operator, five-year license terms, and a 20% tax on adjusted gross gaming revenue.
The differences proved decisive. The Senate measure called for enactment in July 2027. Meanwhile, the House version required a reenactment clause for 2027, meaning 2028 as the earliest launch date. After the Senate bill crossed over to the House, a committee conformed it to the House version, including the reenactment clause.
Another key difference was revenue allocation. SB 118 allocated 3% to iGaming regulation, 2% to problem gambling, and 95% to education funding.
Meanwhile, HB 161 allocated 5% to the state problem gambling fund, 6% to the Internet Lottery Hold Harmless Fund (until 2037), and 89% to the general fund. After January 1, 2027, 95% will go to the general fund.
Each chamber amended and passed the other’s bill before rejecting the revised versions, sending both measures to a conference committee.
The committee was composed of three lawmakers from each chamber, including the bills’ sponsors. The negotiations aimed to reach a compromise, which was never achieved, thus killing iGaming efforts for 2026.
Lawmakers Advance DFS and Skill Gaming Efforts
While iGaming stalled, conference committees reached an agreement on DFS and skill game regulation, with both chambers passing the compromise.
While Virginia legalized DFS in 2016, it currently does not tax operator revenue, relying instead on licensing fees.
Under the new proposals, the state would collect a 10% tax on gaming revenue. Oversight would move to the Virginia Lottery Board, and the minimum age would be raised from 18 to 21. If enacted, the bill requires the Lottery Board to adopt the necessary regulations by Jan. 1, 2029.
Lawmakers also passed a measure to legalize the so-called “skill game” machines. These machines operated for years in a legal gray area. In 2020, the state banned them, but legislative challenges allowed them to operate until 2023, when the state’s Supreme Court upheld the ban.
In 2024, Virginia lawmakers passed a bill to legalize skill games, but then-Gov. Glenn Youngkin vetoed it.
If enacted, the new proposal would place the machines under the Lottery Board’s oversight, with operators paying a 25% tax on gross profits. The bill limits payouts to $4,000 per day. It also allows municipalities to hold referendums to prohibit skill games.
Both measures head to Gov. Abigail Spanberger’s desk.
Fairfax Casino Proposal Also Passed
Another proposal passed after a conference committee is a bill to authorize a retail casino referendum in Fairfax County.
While supporters view a potential casino as a significant economic opportunity, the proposal has faced strong community opposition. An October 2025 poll found that 75% of Fairfax voters oppose a casino, with groups such as the No Fairfax Casino Coalition leading resistance efforts.
Additionally, some local leaders also oppose a potential casino. Earlier this month, the Chairman of the County Board, Chris McKay, said he would not call the referendum if the bill passes.
After the legislature passed the bill, McKay said in a statement that the language was written by pro-casino advocates in the General Assembly, not involving the public. According to reporting, developer Comstock Holdings has spent more than $3.5 million on lobbying.
As the bill heads to Gov. Spanberger’s desk, some Fairfax County supervisors called the governor to veto it.
The decision now rests with Gov. Spanberger. Her response will determine whether Virginia expands its gambling footprint despite the collapse of iGaming efforts this year.
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