Gambling news from http://www.delawareonline.com/
Billion-dollar opportunities are hard to come by -- especially for a small state like Delaware where $1 billion represents nearly half of the state's annual General Fund revenues.
A $1 billion opportunity could be compared with all of the construction around Wilmington's Rodney Square by the former MBNA bank; or the combined construction by Buccini/Pollin at Christina Landing, the AAA Mid-Atlantic project at 1 Riverplace, and Barclay's Bank on West Street.
Any way you slice it, that's how big the economic development pie will be if legislators vote by June 30 to approve House Bill 440. It's the first leg of a constitutional amendment to permit gaming in Wilmington and expand gambling options by allowing table games in Delaware.
Delaware's gaming industry -- which has brought an extraordinary $1.5 billion since 1995 -- is vulnerable. Delaware stands to lose about $118 million to Pennsylvania when slot gambling begins next year. In Chester, just nine miles to the north, horse racing will begin this September at a new track, and slots will be operating there early in 2007. Casinos in Philadelphia are slated to open a year from now.
The Maryland Legislature is expected to approve slots after this year's elections.
According to News Journal reports, the direct impact to Delaware's General Fund could be $130 million annually from Maryland and Pennsylvania.
Once patrons are lured away to newer or more exciting facilities elsewhere, it's almost impossible to bring them back, according to many gaming experts. Unless Delaware offers something new like table games and new venues to its gaming patrons -- two-thirds of them from out of state -- customers may be unrecoverable.
These figures were confirmed by a recent study by a leading industry consultant, Gaming & Resort Development of Laguna Niguel, Calif.
The GRD study shows that not only retaining patrons in Delaware but growing the industry is a matter of developing new "destination" venues.
That means new facilities offering an array of amenities and attractions that will lure regional customers who seek broad choices of table games and slots, plus dinner and a movie, a day trip to museums, or similar tourism activities.
The total dollars at stake from new casino projects in Wilmington could exceed $1 billion in terms of construction of casinos, adjoining hotels and stores, entertainment centers, spas, art galleries and the like, as well as the permanent jobs and downstream multiplier effect on employment in the community. That doesn't even take into account the infusion of state and local tax revenues.
New casino venues would generate 2,000 direct jobs and as many as 6,000 to 8,000 indirect jobs.
Not only would this reverse the loss of about $118 million in market share due to Pennsylvania's startup, but create further demand of $114 million for the existing racinos, and generate about $177 million in new money from the Wilmington locations. That means a total swing of more than $291 million if there are one or more additional new venues, as well as table games.
Riverfront gaming plus table games would add more than $100 million to Delaware's General Fund revenues.
Failure to pass the first leg of this constitutional amendment by June 30 would put Delaware gaming at a competitive disadvantage for as long as four years. A constitutional amendment must be ratified by two consecutive General Assemblies. It's imperative that lawmakers act now on this bill, which allows them the opportunity to debate the measure starting again next January.
If they take no action before June 30, the soonest Delaware could realistically start recapturing lost revenue would be 2010.
Taxpayers would bear the burden of the General Assembly's inaction because the demand for state services will not go away. Legislators will have to look for new sources of revenue, or place higher taxes on existing ones, to make up for the lost $130 million. That figure is more than the state takes in from toll revenues, or real estate transfer taxes. It would take almost a 15 percent increase in personal income taxes to make up for the deficit.
Delaware cannot afford to do nothing while its pockets are picked by neighboring states. |
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