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Bill To License Exclusive Gambling Club Pushed In Delaware

Posted on May 7th, 2010

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Rep. John Viola, D-Newark, persuaded by a group of investors, filed a bill Tuesday that would grant a special gambling license to allow developers to open a private gambling club that would have only moneyed people as members. The project is a concept of Delaware Development Associates, the investors who have proposed to acquire and renovate a four-story building on Market St. in Wilmington that was formerly the main office of a bank, and turn it into a private club that would offer only table games and sports betting, and no slot machines.

The exclusive club would be called The Bank, and would limit its members to not more than 5,000, who would be charged a minimum annual membership fee of $10,000. The members would consist of affluent people from places like New York, Washington, D.C. and others. One investor in the project, Karl Agne, said more than 100 people have already signed letters of intent to join the private club.

The developers said The Bank would pay the state a $1 million one-time license fee, and the gambling revenue is projected to be $2 million annually, plus other revenues from non-gambling operations such as a restaurant on the ground floor that would be open to the general public.

Agne said the club would be less like a casino and more like a country club, with members paying membership fees and monthly dues.”The concept we’re proposing is new. Nothing else like it exists in the United States,” he said. The state’s three casinos, however, are against the legislation. The casinos, currently offering only slot machines and sports betting, have been given permits to run table games and will soon begin operating them in the coming weeks.

Critics also objected to the proposal that the private club would pay the state a tax rate of only 6.75 percent, while the casinos which will soon run table games, will pay 29.4 percent of the gross revenue from those games. Also, the horse racing industry, which receives revenue from the casinos, would not get anything from the club, as proposed.

Viola said he is amenable to giving a portion of the revenue from the club to the horse racing industry, but when asked to comment on the disparity in the tax rate, he said, “To me, this and a racino is apples and oranges.” The measure had enough signatures from members of the House Gaming and Pari-mutuels Committee to be released after hearing Wednesday, but Viola said he would put it back in committee for more discussion and revision.