Delaware Online Gambling Bill Advances in State Legislature

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A general view of Wilmington seen from the the Leonard L. Williams Justice Center on November 16, 2022 in Wilmington, Delaware.

The plan to expand online sports betting options in Delaware took a big step forward.

The bill that opens Delaware online sports betting to up to six total online sportsbooks advanced out of the House Administration Committee and now awaits a hearing in the House Appropriations Committee.

Delaware’s proposed legislation would diversify the online sports betting market by moving beyond the current monopoly held by BetRivers. The bill incorporates recommendations from a legislative study group formed last year.

The group suggested the following recommendations:

  1. Online Sports Lottery: Establish an online sports lottery in Delaware.
  2. Multiple Operators: Allow for multiple online sports betting operators.
  3. Tethered Model: Implement a tethered model by partnering with existing video lottery agents.
  4. Support Horse Racing: Ensure provisions that protect the horse racing industry and maintain purse contributions.
  5. Problem Gambling Resources: Allocate additional resources to address problem gambling prevention and treatment.

It appears lawmakers agree. The bill’s progress signals positive momentum for the expansion of legal online gambling options in the state.

What Would HB 365 Change in Delaware?

Delaware House Bill 365 (HB 365), sponsored by Rep. Franklin D. Cooke, aims to expand the state’s sports betting market by allowing multiple online sports betting operators.

Here are the key points:

  • Partnerships: The bill would permit each of the three Delaware casinos to partner with up to two online sports betting operators. Currently, BetRivers is the sole online sports betting operator in the state through a Delaware Lottery partnership.
  • Legislative Progress: HB 365 recently received support from the Delaware House Administration Committee, which voted in favor of the bill on May 22. It now moves to the House Appropriations Committee for further consideration. If approved, it could open the door to additional online betting options beyond BetRivers.
  • Taxation and Licensing: The bill proposes an 18% tax on sports betting revenue. Sports betting operators would pay the state $500,000 for a five-year license. The generated revenue would contribute to the state’s general fund, as well as support horse racing purses and problem gambling education programs.

Representative Wants More Competitive Market

The end goal would be to create a more competitive and diverse online sports betting landscape in Delaware, benefiting both consumers and the state’s revenue streams. According to Cooke, the current sports betting model in Delaware falls short of generating substantial revenue for the state.

The high fees paid to BetRivers contribute to the net level remaining low. However, Cooke believes that fostering a more competitive market could significantly boost state funds. He emphasizes the importance of allocating these additional resources to address problem gambling and enhance prevention and treatment efforts.

BetRivers and Lottery Oppose the Changes

Representatives from BetRivers’ parent company, Rush Street Interactive, and the Delaware Lottery voiced their opposition to the bill.

They argued that expanding the sports betting market would reduce state revenues. They also claim that there was no interest in the market during the RFP process. Only BetRivers and 888 responded to the lottery’s RFP, but during the most recent committee hearing, the Sports Betting Alliance was present, with representatives from DraftKings, FanDuel and BetMGM speaking. Several lawmakers also expressed concerns about altering the market shortly after the state’s partner launched.

We’ll continue to follow the developments.