A look at Delaware State Lottery figures drives home the dilemma facing legislators seeking a way out of a revenue slide threatens the existence of the industry.
A comparison of 2006 and preliminary 2014 figures shows revenue generated by the industry has dropped by nearly half to $352 million.
That figure remains a significant revenue source in the state’s nearly $4 billion annual budget.
The state’s three casinos at Harrington Raceway, Dover Downs and Delaware Park now face competition from more two dozen casinos. Dover Downs recently rolled out a website at http://jobsfordelaware.com that makes a case for assistance.
The build-out is virtually complete for casinos in Maryland and Pennsylvania, although a $1 billion Las Vegas-style MGM casino at National Harbor in Maryland will go into operation in coming years.
National Harbor is across the Potomac River from Washington, D.C., which has no casinos.
The drop in state revenues comes in spite of an increase in the state’s piece of the action in balancing the budget during the recession of 2009.
Simply dropping the revenue sharing figure down to the pre-2009 level would result in a $20 million reduction in revenue going to the state, but would put casinos on firmer footing.
The bigger chunk of revenue taken by the state has battered bottom lines of the three casinos in the state, despite two temporary aid packages passed at the end of the 2013 and 2014 legislative sessions that ran into the millions of dollars.
The amount of damage to casino earnings statements and balance sheets has not been publicly released, since casinos were successful efforts to keep their financial information private. Some information is available on the commission’s website.
A decade of flush times for the industry as Maryland and Pennsylvania considered gaming legislation produced a brief renaissance for the horse racing industry as pursues increased and a few stables moved to the state.
Neither the state nor casino operators established a fund that would help buffer the industry from the harder times that would come as more casinos were built.
Dover Downs did respond with a destination resort with a luxury hotel, conference center, shops and restaurants., but ended up with a troublesome debt load.
Delaware Park and Harrington also improved their physical facilities, but stopped short of making their venues into destination resorts.
