Delaware’s online sports betting market could grow with the addition of more providers
Legislation proposed in Delaware aims to expand the First State’s online sports betting market through a single operator.
Online sports betting in Delaware only began last December, although the state was one of the first to allow gamblers to place bets on college and professional sports at retail locations. Last summer, the state expanded online sports betting with the introduction of a new iGaming and sports betting partner, Rush Street Gaming’s BetRivers.
BetRivers replaces 888 Holdings as the iGaming and sports betting operator for the Delaware Lottery. House Bill 365, introduced by state Reps. Franklin Cook (D-District 16) and William Bush (D-District 29), proposes ending BetRivers’ online sports betting monopoly and welcoming other sportsbooks to take its place.
“The First State’s increase in online sports betting means additional revenue that will benefit programs that provide treatment, education and support for gambling addiction and problem gambling,” Cook said.
Cook and Bush believe additional online sports betting could increase the state's annual profits from Internet gambling by $400,000.
Settlement Details
HB 365 proposes allowing the state's three brick-and-mortar casinos – Bally's Dover Casino Resort, Delaware Park Casino and Harrington Raceway & Casino – to partner with two other third-party online sports betting operators. Currently, casinos that operate slot video lottery terminals (VLTs) and live dealer table games on behalf of the Delaware Lottery can only partner with BetRivers for online sports betting.
Each online sports betting license costs $500,000 for five years. Gross sales will be taxed at 18%, with proceeds going to the lottery. Another 1.5% of net sports betting profits will go to the horse racing purse. The remaining 80.5% will be allocated to online sportsbooks and casinos.
BetRivers will retain a retail sports betting monopoly at the state's three casinos and dozens of retail sports betting locations offering betting kiosks.
HB 365 has been referred to the House Administration Committee for preliminary consideration.
Unknown interest
Only 1 million people live in Delaware, ranking the state 46th by population. With such a small population, sports bettors may not have much interest in paying $100,000 a year and being hit with a sales tax of nearly 20% if HB 365 becomes law.
The proposed 19.5% effective tax on online sports betting revenue would be higher than the sports betting tax rates in most other states that allow online sports betting. This tax rate is higher than in Arizona, Colorado, Connecticut, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Michigan, Nevada, New Jersey, Ohio, Virginia, Washington, D.C. Tax rates applicable to Internet sports betting revenue. and West Virginia and Wyoming.
Many state officials are pleased with BetRivers' performance since its launch in December.iGaming revenue has increased significantly compared to 888's online casino business, and online sports betting is off to a good start.
In the first two months of online sports betting in Delaware, the lottery's sole partner brokered about $30.8 million in bets. Total proceeds from the event were $2.34 million. BetRivers made a net profit of about $929,000 in two months following government spending cuts.
Delaware is a seasonal state with more than 380 miles of coastline and receives an influx of tourists during the summer.
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Source: www.casino.org
