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Delaware Legislature Passes Online Gambling Law

By: Adam Baker, Friday June 29th 2012
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In a historic moment in the US online gambling history, the state Senate of Delaware finally passed the HB333 with 16 votes in favor to 1 vote against. There was one abstention. The House had passed the bill earlier. The bill has been sent to Governor Jack Markell, who has publicly given his support to the bill. Once he signs the bill into law, Delaware will become the most advanced state in the legalization of online gambling in the United States. The achievement is all the greater, because Delaware was a late entrant into this arena. It began to mull legalizing online gambling only in December 2011 after the US Justice Department clarified that the Wire Act applied only to online sports betting and that states could regulate Internet gambling within their borders without violating the UIGEA.

The proposed law envisages that Delaware casino web sites will offer slot machine, casino games like blackjack and poker. These web sites will be controlled and regulated by the state Lottery Office. Delaware lottery tickets also will be offered online on a state operated web site. The plan is to have about 30 additional sports betting outlets in place before the start of the NFL season and 100 Keno retailers by the end of 2012. Online gambling is expected to go live in early 2013. Geolocation software will ensure that players are within state borders.

The law will bring viability to Delaware’s land casinos, which are facing aggressive competition from neighboring states. Some of the revenues from online gambling will be used to reduce the present $3.75 million licensing fees paid by land casinos. This will encourage them to invest in growth. The state finance department has estimated that the revenues from the new legislation should reach $7.75 million in 2013 alone. Senate President Anthony DeLuca said that it was important to keep Delaware at the forefront of the developments in gambling in the United States. DeLuca was the prime mover for the online gambling bill.

The vote in the Senate was originally scheduled for June 26 but was delayed by a day. There was a concern that there were not enough Democratic Party votes to get the measure through. One of the reasons was the powerful harness racing industry asking for a greater share in the online gambling revenues and seeking to incorporate an amendment to that effect. If an amendment was agreed to, then the bill would have to be sent back to the House for another vote. This would greatly compromise the bill because then it would not go through in the current session. A compromise was reached when the administration has agreed to talk to the horsemen about a greater share of online gambling profits after the bill became law, based on actual revenues generated.

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