Va. budget could erase $56M in payments over failed VCU Health project
City of Richmond previously proposed mediation to resolve the issue
The General Assembly passed a state budget deal that would cancel $56 million in payments the Virginia Commonwealth University Health System agreed to give the city of Richmond for a failed development project.
In 2021, VCU Health sought to develop a $325 million project at the city-owned Public Safety Building, located at 500 N. 10th St. But the project — which would have housed office space, retail and parking — was stopped before construction started.
As a part of the deal, VCU Health agreed to pay the city about $2.5 million annually through 2045. By June 2024, about $2 million had been paid to the city.
State budget language approved in 2024 directed the health system to stop making the payments, leading former city leaders to seek mediation over the deal. In a letter to VCU Health, former Richmond Mayor Levar Stoney said the city would consider litigation.
“This issue has been outstanding for a while, and we