Thursday Feature: Delaware Doubles Down

by Dave on February 19, 2009

Will the First State wager its future on gambling?

Like many states in this recession, Delaware faces tough economic times. State budget writers are reportedly staring at $700 million in deficits for the next 18 months. So naturally, the state is looking around for ways to bring in more money. One of the first targets that caught their eye was increased gambling revenue via sports betting.

Delaware approved slots gambling (defined as ‘video lottery’) in 1994 under the guise of supporting its thoroughbred horse industry. Total lottery revenue skyrocketed, bringing in dollars in excess of $200 million annually. Lottery and slots income became the state’s 4th largest revenue stream, so the state is strongly protective of the video lottery operations.

Delaware’s success in the 1990’s with gambling revenue naturally created an attractive option for neighboring states, threatening Delaware’s regional monopoly. Atlantic City ramped up marketing to stem the losses of gambling revenue, and its casinos continue to pump in billions to attract more gamblers. Pennsylvania now has operational slots venues, and has discussed legalizing table games. Maryland voters approved slots in 2008, and the state is rushing to get those establishments operational, hoping to use the revenue to shore up its own budget by 2011. To underscore Maryland’s commitment, a bill was recently introduced to allow slots in Baltimore-Washington International Airport.

As a result of increased competition, Delaware officials will consider adding sports betting to the state’s gambling repertoire. Because of a ‘grandfather clause’ due to a prior dalliance with sports betting, Delaware is one of only four states (Nevada, Oregon and Montana are the others) exempt from a 1992 federal law banning sports gambling. So leaders in both parties expect to see a bill in the next few months to legalize sports betting at the state’s three slots venues.

The discussion surrounding sports betting has brought back another controversy, which first reared its head during the original debate to approve slots – the lack of a venue here in Sussex County, with its natural tourism draw. But that may soon change.

Rehoboth Beach-based developers Preston A. Schell and Gene Lankford have proposed Del Pointe, a one-mile racetrack on a 370-acre parcel east of Route 113 and north of Millsboro. Schell and Lankford have received a conditional approval from the Delaware Harness Racing Commission. That venue could be eligible for slot machines in the future.

Between sports betting, table games on the horizon and a planned racetrack in Sussex County, Delawareans can bet on gambling to be a part of the First State for years to come.

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