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Possible Sports Betting in Delaware

January 14, 2008

Legalizing activity would boost slots play, add $$$ to state economy
Legalizing sports betting in Delaware could add an additional $26.3 million a year to the state's cash-strapped general fund, a new state report predicts. But the authors say no one can know with certainty what the state's payout will be.

At the request of the General Assembly, three state agencies prepared a study on the impact of reinstituting sports betting in Delaware. They delivered the report to Gov. Ruth Ann Minner and lawmakers Thursday.

The report, which was publicly released Friday, does not make a recommendation on whether to move ahead with sports betting. Minner has been opposed to sports betting, but her term runs out in a year.

The report argues the state's best option, should sports betting be enacted in Delaware, is to base them only at the racinos rather than remote sites.

Most of the revenue would come not from sports betting itself, but slot revenue stemming from the increased number of visits to the racinos, according to the report.

The study assumes a 10 percent increase in slots play. That would lead to a $23.1 million increase in state revenue, combined with an estimated $3.2 million in state revenue directly from sports betting, in 2010.

Rep. John Kowalko, D-Newark South, said that he hasn't taken a stand on sports betting, but is hesitant to have the state rely on it as a source of revenue since it's so unpredictable.

"If they do start losing revenue, they become a burden to the entire state system. Then we have to cut somewhere," Kowalko said.

Ed Sutor, chairman of the Video Lottery Advisory Council, and Rep. Vincent A. Lofink, R-Bear, one of the leading advocates of sports betting in Delaware, could not be reached for comment.

Delaware's three racetrack-casinos are facing a strong challenge from neighboring states, as new casinos open in Pennsylvania. Delaware's gambling industry, along with some lawmakers, has advocated bringing back sports betting as a way to withstand the new challenges.

In 1992, a federal law made it illegal to bet on sports events except in states that already had legalized it. The exemption applied to Nevada, Montana, Oregon and Delaware. Delaware had already permitted sports betting during a short-lived experiment in 1976.

The report said that for legal reasons, all wagering would have to be parlay bets where the customer must wager on the outcome of two or more games. Wagering would be allowed on major professional and college sports, but no betting on Delaware teams should be allowed, the report said.

There's no way to quantify how allowing sports betting would affect problem gambling, the report said. If sports betting moves forward, a portion of state revenues should go toward agencies in Delaware that provide services in this area, the report said.

The report says it's impossible to know how much revenue will come in. "Typically, revenue estimation largely depends on past experience. In this case, there is none," the report said.