Delaware lawmakers are divided over a proposal to expand the number of sports betting apps. Supporters say it will bring the state more revenue by giving Delaware residents options they go out of state for. Opponents say the single operator now in place through BetRivers produces more revenue.
State Rep. Frank Cooke introduced legislation to permit multiple vendors to operate in Delaware as opposed to the lone operator.
The Delaware Lottery Office prepared the contract with Rush Street Interactive, the parent of BetRivers, in August 2023, but Cooke complains the contract was signed before the Internet Sports Lottery Legislative Working Group was able to deliver its report.
The group recommended as many as six mobile sports betting operators.
“This legislation will produce revenue for the state and to assure that Delaware state’s lottery office remains competitive with our neighboring states,” Cooke said.
The proposed legislation would require operators to provide the state with 18 percent of their revenue, while at current levels, BetRivers is estimated to deliver the state around 40 percent of revenues for the general fund.
Those figures do not factor in one-time revenue from the $500,000 license fee each vendor would be required to pay for a 5-year license.
Adam Marchuk of Rush Street argues the app has only been operational for almost five months, and the sole contract remains the most profitable option for Delaware.
“I’ve heard some criticisms of our performance, but we are on pace to meet and exceed all projections for the Delaware online sports betting market this year and for years to come,” Marchuk told Delaware Public Media. “If the market is the same size, the state unquestionably makes more revenue under the single operator model, as reflected in the fiscal note.”
Marchuk said the state is taking 58 percent of gross gaming revenue under BetRivers, which is then distributed to the general fund, to the horse racing industry and problem gaming support, which he says is unprecedented in the U.S.
But supporters of an expanded marketplace say BetRivers lacks the brand name market.
“In the month of March alone, there were 600,000 attempts to log into the FanDuel app in the state of Delaware. These are Delaware residents, folks commuting through the state and individuals staying in the state,” FanDuel representative Mike Ventre told DPM.
House Minority Leader Mike Ramone warned of possible legal challenges from Rush Street Interactive if the bill were to go through.
“The way everybody loses is when we end up in court,” Ramone told DPM. “I’m just stating, if I were the owner and this [bill] went through, in any format, without my involvement or cooperation, [the state] gets sued, not [the other vendors].”
Representatives from Bet MGM and DraftKings spoke in favor of the bill, but Delaware Acting Secretary of Finance Rebecca Goldsmith and representatives from the state’s horse racing industry testified against it.
The bill was released from the House Administration Committee to let vendors negotiate before sending the bill to the House floor.
