Twin River files for bankruptcy

LINCOLN, R.I. (WPRI) - The owners of Rhode Island’s largest slot parlor filed for bankruptcy protection Tuesday as they struggle to repay millions of dollars in debt, putting in question the state government’s third-largest source of revenue as it faces its own fiscal troubles.

UTGR Inc. filed for Chapter 11 bankruptcy, which allows a business to free itself from creditor lawsuits and reorganize its finances. The reorganization plan must be approved by a judge and by a majority of creditors.

A Bankruptcy Court hearing was scheduled for Tuesday to consider initial motions in the case. Twin River will remain open.

Twin River ran into financial trouble after its owners took on $565 million in debt to purchase the racetrack and gambling hall in 2005 and then renovate it.

Video slot machines inside the gambling hall are expected to raise around $238 million for the state during the fiscal year ending this month, its third-largest revenue source behind the personal income tax and sales and use taxes.

The company had warned earlier this month that it would file for bankruptcy unless it could renegotiate a deal with its lenders and the state.

Earlier this year, Gov. Don Carcieri’s administration broke off talks with Twin River officials who were seeking help because Carcieri felt the state could not afford to take on the facility’s debt. House lawmakers are expected to vote on a budget plan later this month that tries to close a massive budget shortfall with spending cuts and tax hikes.

BLB Investors LLC purchased the property in 2005 from Wembley PLC after its previous owners become intwined in a Statehouse corruption scandal.

The dog track, then known as Lincoln Park, former General Manager Dan Bucci and Nigel Potter, former chief executive of Wembley PLC, were found guilty that year of conspiring to bribe then-House Speaker John Harwood. No bribe was ever paid, and the House speaker was never charged.

The Rhode Island Greyhound Owners Association has called efforts by the big banks to eliminate greyhound racing under Twin River’s bankruptcy filing unreasonable. The RIGOA have pledged to continue their fight to keep hundreds of jobs in tact for Rhode Island workers.

“The banks today showed their true interest protecting their pocketbooks at the expense of Rhode Island workers and taxpayers. Greyhound racing generates millions in tax and fee revenue for the state and provides hundreds of individuals with well-paying jobs. It is critical that these jobs and this revenue be preserved,” said Jennifer Bramley, RIGOA spokesperson.

“The issue here is the value of protecting local jobs and state tax revenue versus the bottom line of big, out-of-state banks. The choice is clear for Rhode Island.
“Our commitment is to protect our 225 workers from the already full unemployment rolls and ensure they have the means to provide for their families,” Bramley continued.

“In the coming days and weeks, the greyhound owners association will continue its fight to keep Rhode Island workers working and to protect this productive industry and longstanding tradition.”