Schell: Sussex deserves racino

If state lawmakers approve Gov. Jack Markell’s plan to allow new casinos and Millsboro officials OK a proposed gambling-entertainment complex, Preston Schell said the casino he proposes would create 6,000 construction-related jobs beginning this summer. He also said the Del Pointe complex will fill a void in Sussex County by bringing a racetrack – and 4,000 full-time jobs – to the Cape Region.

But Schell’s plan and the governor’s have run into resistance from existing casinos. At a Tuesday, March 24, press conference, Dover Downs Hotel & Casino Chairman Denis McGlynn opposed Markell’s proposal to expand gambling in the state. The casinos say new venues will dilute their revenues and force layoffs. They also say the state should not take a larger share of revenue.

The Delaware Standardbred Owners Association joined the casino owners to oppose new gambling venues.

Principals of Del Pointe, however, say competition breeds excellence. They also say they’ve been betrayed by some gaming officials, who had supported their plans before Markell launched his expanded gaming proposal last week.

“This is just one more example of Sussex County being left out of the economic-enhancing initiative of state government,” said Schell, principal of the proposed 377-acre complex on Route 113.

At the press conference, association spokeswoman Rebecca Kidner said her organization met a handful of times with principals of Del Pointe. “As currently proposed, Delaware Standard does not support it,” she said. She declined to comment further, instead referring all questions to Sal DiMario, executive director.

Schell said the association is being bullied by casino owners and forced to join casino executives in opposing Del Pointe.

DiMario disagrees.

The association began talks with Schell and Gene Lankford last spring, said DiMario.

The horse tracks have a racing schedule that divides time between Harrington and Dover Downs – a system that works with little room for overlapping races, he said.

In Dover, races are held from October to April. In Harrington, they’re held from May to July, said DiMario.

“There is a six-week gap after July before October. Why the conflict? The horse supply,” he said.

Schell said hopes to complete his project and hold races in July and early August 2010 – racing days that are not scheduled at the other racinos.

DiMario said the state couldn’t support more racetracks. He pointed out that when Florida and Canada allowed more racetracks, business plummeted. Finally, DiMario said, if more horse tracks are allowed in Delaware, and more video lottery machines that go with them, existing track owners might do away with racing altogether. He said maintaining tracks is very expensive, pointing out that there’s a rusting grandstand and long-forgotten harness-racing track in Georgetown.

“We have longstanding relationships with racetracks in Delaware. I hardly think that means being bullied by them, putting their money where their mouth is.

“The racetrack association, Schell and the governor are not bullying me. We’re businessmen. We look at the greater good. I really take offense to that,” DiMario said.

While Schell and gaming officials disagree over Del Pointe, they agree on one point: state government should not get a larger share of the revenue.

Sussex: out cold

Downstate Delawareans were first cut out of a gambling deal in the 1990s, said Schell.

In 1994, state legislators passed the Horse Racing Redevelopment Act, adding slot machines, or video lottery terminals, at Dover Downs, Harrington Raceway and Delaware Park in Wilmington – and none in Sussex County.

Patti Key, chief executive officer of Harrington Raceway & Casino, said she doesn’t think a Cape Region racino could survive.

“No, I don’t think the revenues will come from the beach area at all,” Key said. She also said new gaming complexes “would be the slow death over the long run for a short-term fix.”

Delaware Park Chief Operating Officer Bill Fasy said his casino is already losing customers to gambling venues in Harrisburg, Pa., and Chester. “You’d be adding to supply when the demand isn’t there,” he said.

Schell said, “To say that somehow existing racinos can’t handle the competition is ludicrous. It’s like opening a restaurant in Rehoboth and saying no one else can open another restaurant in the city,” said Schell. Schell said he doesn’t buy the casinos’ argument: “We’re having a hard time making the numbers work.”

Schell said he’s tried to reach out to other casinos, seeking ways the casinos might help each other. Finally, he said while he welcomes their support, he doesn’t need the association or other gaming venues to stand behind him.

“If the horsemen don’t want us to build it, we’ll go with someone else,” Schell said. He suggested soccer or lacrosse venues.

“We do feel strongly we can finance it in this climate. We’ve already been contacted by multiple groups,” he added.

Schell said he has spoken with “one of two large investment banks remaining, an international investment bank and a large gaming industry consulting group with a capital arm.”

“When it comes down to reducing profits a little bit for other casinos or reducing payroll of state workers by more than the existing 10 percent, it should be an easy decision for the public to make,” he said.