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Sports Betting in Delaware Ok'd by House

May 18, 2008

Sports betting, legal in Delaware but not offered there since the 1970s, is on the table again as state officials look for new ways to make money in a difficult economy. The state House of Representatives on Thursday passed a bill that would allow betting on professional and college sports teams, with the exception of Delaware schools, at state casinos.

Proponents say sports betting will legalize what many people are already doing illegally and enable the state to make money from it. When fully implemented at the state's three casinos -- Delaware Park, Dover Downs and Harrington -- gambling could generate anywhere from $22 million to $70 million a year, said Rep. Vincent Lofink, R-Caravel Farms, sponsor of House Bill 190.

"It's a revenue where you're not just taxing people," he said. "In the situation we're in, we're looking at raising taxes. I think we need to make an effort to raise revenue without a tax increase so we're not doing it on [residents'] backs entirely." The bill heads to the state Senate next, where its fate is uncertain.

Critics say legalized sports gambling will do more harm than good, creating a new class of gambling addicts, and that the state will profit off those who can least afford to lose money.

"This is potentially opening up a Pandora's box to many different ills without bringing as much money into the state as people think," said Don Mell, a spokesman for the newly formed Coalition Against Sports Gambling in Delaware.

According to a recent national gambling impact study, the state of Nevada brings in $2.5 billion from sports wagering. That, however, is a drop in the bucket compared with the estimated $400 billion bet illegally through bookmakers or Internet sports gambling sites. Michael Konik, author of the book "The Smart Money: How the World's Best Sports Bettors Beat the Bookies out of Millions," said legalized sports betting would make sense for Delaware.

"There are two things that the citizens of the United States will never stop doing no matter what the law says," said Konik, once a professional sports bettor. "Gambling is one of them. Therefore, as the state has learned with the racetracks, Powerball and slots, it's beneficial for them to collect a piece of the action and use that money for something beneficial."

But Gov. Ruth Ann Minner isn't interested in that kind of revenue. Completing her final term in office, she has said she would veto any sports betting bill. That is why, Lofink said, the bill that passed Thursday on a 28-10 vote includes a provision that it would not be enacted until Feb. 1, 2009 -- after Minner leaves office.

"That's to honor the governor's wishes," he said. "She said not on her watch, but that [date] is to be prepared for the next governor."

Delaware is one of only four states, along with Nevada, Oregon and Montana, that can offer sports betting legally. That's because Delaware operated a sports lottery -- specifically, a one-season-long 1976 effort allowing wagering on NFL games -- before the 1992 passage of federal legislation banning sports wagering.

NFL, NCAA oppose it
Both the NCAA and the professional sports leagues say they oppose sports betting. Earlier this week, the NFL bought an advertisement in The News Journal urging lawmakers to oppose HB 190. The slogan for the ad was "Keep Vegas in Vegas." At the bottom of the ad, it says, "Sports Betting = More Problems, Not More Revenue."

"The NFL's policy on this issue has been consistent for decades," said Brian McCarthy, a spokesman for the league. "Simply put, gambling and sports do not mix. Sports gambling threatens the integrity of our games and all the values they represent, especially to young people. The NFL has been an active proponent of federal and state efforts to combat sports gambling."

On Thursday, though, Rep. Nancy Wagner, R-Dover, questioned that stance, pointing out that the NFL sanctions fantasy football leagues in which people gamble. Similarly, Konik called the NFL and other sports leagues hypocrites because they benefit indirectly from sports gambling.

More than $92 million was bet legally in Las Vegas on the last Super Bowl, and $80 million was wagered on the 2007 NCAA men's basketball tournament. The FBI estimated that $2.5 billion was wagered illegally on the 2007 NCAA tournament. The leagues benefit because there is so much money on the line. That leads to more people watching games, which drives up TV ratings, which in turn drives up the TV rights fees paid to the leagues.

Besides, if the leagues didn't strongly oppose gambling, it would give the impression that the games might be fixed. The NBA, for example, was rocked by a betting scandal last season when longtime referee Tim Donaghy was busted for wagering on games that he officiated. Both professional and college sports have suffered game-fixing scandals as well.

"It's the height of hypocrisy," Konik said. "The professional sports leagues and the NCAA are built on gambling. The only reason the games during March Madness are interesting is because of gambling. Normally, no one would have any interest in watching Duke play Alcorn State. But in the tournament, people will watch to see if Duke covers that 39-point spread.

"That's what compels people to watch until the very end."

A 'leg up' on competition
Ferris Wharton, longtime prosecutor and co-chairman of the state's new anti-gambling coalition, sees gambling not as a revenue-generator but as an industry that just moves money around. "Where do you want to build your economy? You want to build it on a firmer foundation than gambling," he said. Wharton contends that gambling is bad for sports, and notes that the legislation specifically outlaws wagering on Delaware college sports events.

"If it's OK and it doesn't harm anybody, why are Delaware teams exempted from it?" he asked.

Hale Humphrey-Jones, a psychologist, author and gambling expert, works with problem gamblers and foresees sports-betting creating a new wave of gambling addiction.

"I work with people who have gambling problems, and I would say 95 percent of the people I work with would say they never had serious problems with gambling until the slots opened in Delaware Park," Humphrey-Jones said.

The availability of legal sports gambling at the tracks would just add to that pool of problem gamblers, she said. Plus, efforts are afoot to encourage the state to not only allow sports betting but also expand it beyond the existing casinos, to which it is restricted by H.B. 190.

P. Gary Ward of Delaware Sportsbetting Corp. is floating draft legislation that would allow off-track sports betting parlors as well, and he hopes to get Seaford Republican Rep. Daniel B. Short and Bethany Beach Democrat Sen. George H. Bunting Jr. to sponsor his bill.

That bill could appeal to legislators from Sussex, the only county with no racetrack or slots parlor. Some Sussex residents must drive an hour just to get to the slots parlor in Harrington.

Lofink says sports betting is more than a revenue stream for the state. As much as 60 percent to 70 percent of Delaware's slots revenue comes from Maryland and Pennsylvania residents who travel here to play, he said. Delaware needs this venture to counter the impact of slots machines in Pennsylvania as well as the possible advent of slots in Maryland. Voters there will decide that issue in a referendum in November.

"If Maryland gets slots, people from Annapolis aren't going to be coming quite as often to Harrington,"Lofink said. "[H.B. 190] gives us a leg up on the competition."
The idea of sports betting sends the wrong message to young people and ruins the "purity" of sports, according to Wilmington city councilman Theo Gregory. "People want to go to games to relax and not to stress over the different betting levels or whether the team will cover the spread," Gregory said. "People have to have some leisure. I would like to see the purity of sports without gambling."

But Konik says it's too late.

"It's unstoppable," Konik said. "People are going to bet on things, whether it's legal or not."