PROVIDENCE, R.I. (WPRI) — Gov. Dan McKee signed a bill Friday that gives gaming technology company IGT and Twin River owner Bally’s Corp. control of most of Rhode Island’s gambling operations for the next 20 years.
In exchange for the no-bid contract, both companies have committed to creating more jobs in the state.
“This legislation represents $250 million in economic development that includes securing 1,100 well-paying jobs right here in the state of Rhode Island,” McKee said.
Both House Speaker Joe Shekarchi and Senate President Dominick Ruggerio backed the deal once amendments were made last month, saying it’s critical to protecting local jobs and preserving one of the state’s largest revenue streams.
McKee said the amended bill is “dramatically improved” from when it was first introduced.
Some of the amendments include:
- Upfront payment to state increases from $25 million to $27 million
- Bally’s 30 new jobs must be put into place by Dec. 31, 2022
- Bally’s increases its commitment to the I-195 commission for park naming rights by $200,000
- IGT financial commitment increases from $155 million from $150 million
- The penalty for missed job counts increased to $7,500 per job compared to $6,400 per job
- The venture’s commitment to problem gambling increased from $125,000 to $200,000
“These are guarantees and protections for the state that simply would not be possible to secure through a bid process, and they are great for Rhode Island,” Ruggerio said Friday.
“Two great Fortune 500 companies based in Rhode Island that will be here at least 20 more years will continue to grow,” Shekarchi added. “The better you do, the better the state does, so we’re proud to have you as good corporate citizens and we wish you much success.”
The contract also includes an expansion of Twin River Casino in Lincoln. According to Elizabeth Suever, Bally’s vice president of government relations, 40,000 square feet will be added to the gaming floor, along with a 10,000 square-foot spa and enhanced food hall area.
The R.I. Division of Lotteries continues to maintain oversight and regulation of all gaming, and all aspects of the lottery and gaming programs will continue to be state-operated.
The Rhode Island GOP later released a statement saying they believe the contract “overpays these multi-national corporations by $800 million.”
“First, the state is getting ripped off by only taking 12.7% of our table game revenue. If we were to match Massachusetts’ 25% take, that would put an additional $400 million in state coffers. Next, Rhode Island will pay IGT 2.5% of slot revenues for what our independent analyst described as an unnecessary computer system. Meanwhile, IGT only charges Kansas 1% of slot revenues its computer system. Matching Kansas would net approximately $156 million for the state. Last, the state will pay $221 million more to lease slot machines from IGT and Twin River than if we just purchased them – like the 90% of casino owners across the country that purchase their own slot machines.
“Democrats trumpet this as a ‘jobs saving bill,’ which is not entirely accurate. The new legislation amends the state’s relationship with IGT to now count all sorts of non-employee independent contractors and outsourced staff towards its 1100 jobs mandate — such as its army of lobbyists. Worse, the penalty for IGT’s failure to meet the jobs mandate is merely $7,500 per job — although IGT/Twin River claimed during hearings that each job would benefit the State to the tune of $23,750. Why would the state agree to a penalty that is less than the benefit of its bargain?
“The 20-year tech-based deal epitomizes backroom dealing, corporate welfare, and crony capitalism. However, it only authorizes the Governor to bypass public bidding laws and enter into this 20-year insider deal. He is not required to accept the plan outlined in the legislation, nor should he. To protect taxpayers Governor McKee should do the responsible thing and negotiate a better deal.
“We hope he takes this opportunity to build a lasting legacy — unsaddled by his predecessor’s bad deal — and fights to keep more of the profits from the People’s casinos to fund education, public safety, environmental protection, housing, transportation, infrastructure, and reduce our tax burden.”