Central Delaware
Gaming officials: Out-of-state competition still pinching revenue

DOVER — Competition from neighboring states is continuing to squeeze revenues at Delaware’s three casinos, gaming officials complained Tuesday.

The Video Lottery Advisory Council met for the second time this year to discuss the state of the gambling industry in Delaware.

And they’re worried by the continuing fall in revenue.

The council, formed in 2003 to provide recommendations to the secretary of finance, focused largely on the declining revenues — and what can be done about it.

Combined slot revenue for Dover Downs, Delaware Park and Harrington Raceway, which was $636,976,000 in 2006, when the first Pennsylvania casino opened, has declined every year since.

In 2013, money brought in by slots in Delaware reached a total of $375,029,000, and over the first six months of 2014, proceeds from slots were down 9.6 percent.

“We’ve seen a steady decline in slot revenues, and slot revenues, for those who don’t know, represent about 85 percent or more of the gaming revenues that the casinos have in the state of Delaware,” Dover Downs president and CEO Edward J. Sutor said.

Table games began in Delaware midway through 2010 and brought in $63,529,000 in the first full year they were available. However, that number fell to $51,310,000 last year and is down another 15.4 percent so far in 2014.

The decrease in table game revenue is largely due to the 2012 opening of Maryland Live, and the drop is expected to continue as Baltimore’s Horseshoe Casino begins operations in August.

“Horseshoe is a name and their brand is most noted for mid-level table games,” Mr. Sutor said.

The council spoke regarding the $9.9 million break the casinos will be getting from the state. Whereas previously vendor fees were taken out of the casinos’ shares, now they will be covered before the revenue is split three ways, so the burden is shared with the state and horsemen.

Mr. Sutor noted the legislation, Senate Bill 264, was passed by a large margin despite some criticism from representatives and senators that a few members of the council referred to it as unfair and inaccurate.

“It’s the furthest thing from a bailout,” Mr. Sutor insisted. “That has negative connotations that go back to when the recession started, when the government bailed out GM (General Motors) or bailed out Wall Street.

“When the public hears that word ‘bailout,’ they think it’s money coming out of their pockets,” he added.

Vernon A. Kirk, director of the state lottery, said officials from Delaware and its three casinos are working with administrators from Nevada and Caesars Palace as part of the agreement made earlier this year to allow online gambling between individuals from the two states.

With the legal framework in place, they are working on further details and regulations, Mr. Kirk said.

The group also discussed new slots that were recently added to Dover Downs and Mr. Sutor said Dover Downs has no plans for major additions.

“We’re in a very saturated market, and the pie isn’t getting bigger; it’s just getting sliced up into more parts,” Mr. Sutor said.

Staff writer Matt Bittle can be reached at 741-8250 or Follow him at @MatthewCBittle.