DOVER, Del. (AP) - Gambling on professional and college sports in Delaware is feasible and could add more than $4 million a year to the state's general fund, a study group said Thursday.
A draft report by the group suggests that lottery-style sports gambling based on a Las Vegas model could generate $150 million in wagering annually, a figure disputed by opponents of the gambling proposal.
Members of the Sports Gaming Activities Study Committee voted 5-1 to declare in the report that sports gambling in Delaware was feasible, after some expressed reluctance to include a stronger recommendation in favor of sports gambling. The report will be sent to the House of Representatives for consideration.
Three members of the committee abstained from voting, and the lone dissenter was Gov. Ruth Ann Minner's finance secretary, David Singleton. The Minner administration is opposed to sports gambling.
The report envisions sports gambling as being run by the state lottery office and restricted to adults over 21 at the state's three slot-machine casinos. Betting would be allowed on all major professional and collegiate athletic events, except for those involving a Delaware college or university, and the state would retain risk-management experts to assist in establishing and revising odds and point spreads.
To meet lottery requirements that a game be based on chance rather than skill, and possibly to comply with a 1992 federal law under which Delaware has the chance to revive sports gambling, no simple winner-loser bets on single games would be allowed.
Instead, each wager would include a point spread, an "over-under" bet on total points scored, multiple games, or other elements to ensure that skill is not the determining factor in winning.
Because of a short-lived, unsuccessful professional football lottery in 1976, Delaware is one of only four states, along with Nevada, Oregon and Montana, to be grandfathered out of the 1992 federal prohibition against sports betting.
Lawyers for Delaware's three casinos have determined that, with the proper restrictions and structure, a sports lottery would be permissible under both federal law and the state constitution.
But lawyers hired by professional sports organizations, including the National Football League, believe sports betting as contemplated in Delaware would be prohibited by the state's constitution and lottery statute.
"I'm not a lawyer, and I'm not prepared to jump in with the two conflicting legal opinions," Singleton said in explaining his dissenting vote on the feasibility of sports betting.
While the report itself acknowledges the differing legal opinions, Edward Sutor, executive vice president and chief operating officer of Dover Downs Gaming and Entertainment, said he has no doubt that the law allows sports betting in Delaware.
"It's legal, it's attractive, and it's doable," said Sutor, a member of the subcommittee that drafted the report.
Supporters of sports gambling say it will provide an economic boost to both the state and the casinos. They note that Delaware, which is facing a financial threat from the possibility of slot machines in neighboring Maryland and Pennsylvania, would have an East Coast monopoly on legalized sports betting.
Critics are worried about the social consequences, saying sports betting would create more gambling addicts, lure youngsters into gambling and reflect negatively on the athletes many people consider to be role models.
The National Football League, National Basketball Association, National Hockey League, Major League Baseball and National Collegiate Athletic Association are all opposed to sport betting in Delaware.
Jay Moyer, special counsel to the NFL, said the exclusion of Delaware schools from potential sports betting was a "telling" acknowledgment that sports gambling could cause problems.
"If sports betting is not harmful, if it's not benign, why would you exclude events that people in the Delaware region, presumably, would be most interested in?" Moyer asked committee members.
Singleton and other opponents also questioned the financial projections included in the report.
According to estimates by gambling industry representatives Michael Knapp and Leonard Del Genio, Delaware could expect about $150 million in wagers annually, equal to the combined average sports book at three large Las Vegas casinos. They also estimate the "hold" retained by the casinos in Delaware to be about 7.5 percent, compared to about 4.6 percent for the Vegas sports books, resulting in about $11.2 million in revenue.
After subtracting operating expenses of about $4.7 million, the state would get about $4 million of the proceeds and the casinos would share about $1.2 million, with a similar amount going to the harness racing industry.
Critics believe Delaware's financial results would be more similar to those of Oregon, which since 1989 has run a professional football lottery, available in some 2,500 retail outlets. Over a period of more than 13 years, the sports lottery in Oregon, with about four times the population of Delaware, has generated only about $27 million in profits on sales of about $121 million.
By comparison, legal sports betting in Nevada drew $2.3 billion in wagering in fiscal 1998.
"Oregon, in my view, is the only real-world model for your projections," Moyer said. "Everything else is just pie in the sky."
http://www.lasvegassun.com/sunbin/stories/nevada/2003/may/22/052210143.html
A draft report by the group suggests that lottery-style sports gambling based on a Las Vegas model could generate $150 million in wagering annually, a figure disputed by opponents of the gambling proposal.
Members of the Sports Gaming Activities Study Committee voted 5-1 to declare in the report that sports gambling in Delaware was feasible, after some expressed reluctance to include a stronger recommendation in favor of sports gambling. The report will be sent to the House of Representatives for consideration.
Three members of the committee abstained from voting, and the lone dissenter was Gov. Ruth Ann Minner's finance secretary, David Singleton. The Minner administration is opposed to sports gambling.
The report envisions sports gambling as being run by the state lottery office and restricted to adults over 21 at the state's three slot-machine casinos. Betting would be allowed on all major professional and collegiate athletic events, except for those involving a Delaware college or university, and the state would retain risk-management experts to assist in establishing and revising odds and point spreads.
To meet lottery requirements that a game be based on chance rather than skill, and possibly to comply with a 1992 federal law under which Delaware has the chance to revive sports gambling, no simple winner-loser bets on single games would be allowed.
Instead, each wager would include a point spread, an "over-under" bet on total points scored, multiple games, or other elements to ensure that skill is not the determining factor in winning.
Because of a short-lived, unsuccessful professional football lottery in 1976, Delaware is one of only four states, along with Nevada, Oregon and Montana, to be grandfathered out of the 1992 federal prohibition against sports betting.
Lawyers for Delaware's three casinos have determined that, with the proper restrictions and structure, a sports lottery would be permissible under both federal law and the state constitution.
But lawyers hired by professional sports organizations, including the National Football League, believe sports betting as contemplated in Delaware would be prohibited by the state's constitution and lottery statute.
"I'm not a lawyer, and I'm not prepared to jump in with the two conflicting legal opinions," Singleton said in explaining his dissenting vote on the feasibility of sports betting.
While the report itself acknowledges the differing legal opinions, Edward Sutor, executive vice president and chief operating officer of Dover Downs Gaming and Entertainment, said he has no doubt that the law allows sports betting in Delaware.
"It's legal, it's attractive, and it's doable," said Sutor, a member of the subcommittee that drafted the report.
Supporters of sports gambling say it will provide an economic boost to both the state and the casinos. They note that Delaware, which is facing a financial threat from the possibility of slot machines in neighboring Maryland and Pennsylvania, would have an East Coast monopoly on legalized sports betting.
Critics are worried about the social consequences, saying sports betting would create more gambling addicts, lure youngsters into gambling and reflect negatively on the athletes many people consider to be role models.
The National Football League, National Basketball Association, National Hockey League, Major League Baseball and National Collegiate Athletic Association are all opposed to sport betting in Delaware.
Jay Moyer, special counsel to the NFL, said the exclusion of Delaware schools from potential sports betting was a "telling" acknowledgment that sports gambling could cause problems.
"If sports betting is not harmful, if it's not benign, why would you exclude events that people in the Delaware region, presumably, would be most interested in?" Moyer asked committee members.
Singleton and other opponents also questioned the financial projections included in the report.
According to estimates by gambling industry representatives Michael Knapp and Leonard Del Genio, Delaware could expect about $150 million in wagers annually, equal to the combined average sports book at three large Las Vegas casinos. They also estimate the "hold" retained by the casinos in Delaware to be about 7.5 percent, compared to about 4.6 percent for the Vegas sports books, resulting in about $11.2 million in revenue.
After subtracting operating expenses of about $4.7 million, the state would get about $4 million of the proceeds and the casinos would share about $1.2 million, with a similar amount going to the harness racing industry.
Critics believe Delaware's financial results would be more similar to those of Oregon, which since 1989 has run a professional football lottery, available in some 2,500 retail outlets. Over a period of more than 13 years, the sports lottery in Oregon, with about four times the population of Delaware, has generated only about $27 million in profits on sales of about $121 million.
By comparison, legal sports betting in Nevada drew $2.3 billion in wagering in fiscal 1998.
"Oregon, in my view, is the only real-world model for your projections," Moyer said. "Everything else is just pie in the sky."
http://www.lasvegassun.com/sunbin/stories/nevada/2003/may/22/052210143.html
