New Delaware bill could open the door for six new operators to enter the market
House Bill 365 looks to allow new operators into the state with an 18% GGR tax rate and a five-year license costing $500,000
A new bill in Delaware could pave the way for a competitive, multi-license online sports betting market after operating under an effective monopoly model since 2013.
House Bill 365, sponsored by Representatives Frank Cooke and William Bush, would look to allow Delaware to follow in the footsteps of neighboring states Maryland, New Jersey, and Pennsylvania in allowing multiple firms to operate in the market.
As part of the new bill, operators will be required to pay a $500,000 fee for an initial five-year license after gaining market access by partnering with one of the three video lottery agents in the state.
Video lottery agents will be allowed to partner with up to two online operators, with a renewal fee for a further five-year license set at $250,000. The monies received by the state from the license fees will be allocated to the state’s general fund.
This could effectively see six new operators enter a market with a population of little more than one million people.
The state is smaller than Rhode Island, which recently launched online casino via an effective monopoly with Bally’s.
A proposed GGR tax rate of 18% has been included in the bill, with proceedings going firstly towards administrative costs and then $400,000 or 3.5%, whichever is greater, will be funneled to the Division of Substance Abuse and Mental Health.
The remainder of the proceeds returned to the state will be transferred to the State Lottery Fund for the benefit of the state more generally.
Operators will also be required to pay an additional 1.5% of adjusted GGR to purses for allocation under the direction of the Delaware Thoroughbred Racing Commission or the Delaware Harness Racing Commission.
Additionally, only those aged 21 and over will be allowed to wager, as detailed in the bill.
The legislation also notes the new act will come into effect immediately, with a 75-day window to establish a regulatory framework.
Bill 365 was assigned to the House Administration Committee for consideration yesterday, April 11. The committee is expected to hold a hearing within the next 12 legislative days.
In comments reported by WBOC, Cooke said: “The addition of online sports betting in the First State means additional revenue will benefit programs for the treatment, education, and assistance of compulsive gamblers and problem gambling.
“We’re talking about $400,000 or 3.5% of the proceeds returned to the state for funding these programs. Those dollars will go a long way,” he added.
As is stands, the Delaware Lottery runs an effective monopoly in the First State.
The operator went live with its first online sportsbook and relaunched three online casinos powered by Rush Street Interactive (RSI) on January 3, 2024.
RSI won the concession in August on an initial five-year term and took over from 888, whose contract with the Delaware Lottery ended in early 2023 after 10 years.
The operator launched its BetRivers sportsbook brand in the state, while three online casinos – Delaware Park, Bally’s Dover Casino, and Harrington Raceway & Casino – relaunched.
Since going live in January, handle in Delaware has totaled $30.8m, with revenue coming it at just over $2.3m.