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Gov Has Many Doubts About Rhode Island Casino Measure

Posted on June 18th, 2010

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A bill that would ask voters in Rhode Island to decide whether or not to allow the state’s two slots venues to offer a complete range of table games has made it to the last hours before the conclusion of the 2010 legislative session last week. The General Assembly that has mostly Democrat legislators approved the bill with a 62-12 vote in the House and a narrower 21-14 vote in the Senate. The measure is now before the governor, subject to his final approval. But Rhode Island Republican Governor Don Carcieri said he has serious doubts about the casino bill.

At present, only video lottery terminals are allowed at the state’s two slot parlours, the Twin River in Lincoln and the Newport Grand in Newport. The gaming revenues at these two venues are currently imposed a 61 percent tax, which means an almost $300 million in revenues for the state a year. The recently-passed bill calls for a referendum that puts the question before voters whether casino-style gambling should be allowed at Twin River and Newport Grand.

The communities hosting the facilities, Lincoln and Newport would also have to grant their approval for any gambling expansion. On Wednesday, the governor told WPRO-AM Radio that he will have a meeting with his staff on Wednesday and Thursday to discuss some very important points of the bill.

Carcieri has always been against casino gambling, but he was previously quoted as saying he would not oppose any move to convert Twin River into a casino, because, as he said last fall, the bankrupt Twin River needs new management, and since the slot parlour is already existing, he has to do something to save it, as it provides the state with substantial revenue.

But now Carcieri is raising the issue about the legality of the bill ignoring what the local host community has to say on gambling expansion. He said the state has Home-Rule Charters which gives every town the right to direct matters or events that concern the community. Although the gambling expansion proposal would have no difficulty of being approved in Lincoln, Carcieri said Newport would be a concern, since city officials there, and even Senate President Teresa Paiva-Weed, a Democrat whose district includes Newport, are not in favour of expanding gambling at Newport Grand.

Aside from that, the governor also decried the bill’s failure to clearly stipulate the tax rate that would be imposed on the casinos. But House spokesman Larry Berman said once the measure is approved by voters, the state’s share of the revenues would then be discussed and agreed on. He said the legislation would comply with the rules of the constitution. Another issue casting doubt on the bill is the provision in the state Constitution that says only lotteries operated by the state are allowed in the state. Instead of amending the Constitution, the bill classified the state’s two slot parlors as “state-operated facilities” wherein the state would have control over the decisions and running of the business operations, such as the quantity and types of games, management of finances and the hiring of workers.

Joseph Larisa, an attorney who was hired by Carcieri in his struggle against Harrah’s attempt to put up a casino in West Warwick, argued that only the video lottery terminals are state-operated, but not the facilities. He also raised the question of how the state can have control over the card dealers who are not employees of the state. Larisa said there are many things pertaining to the legality of the bill that need to be straightened out.

Carcieri said that what spurred Rhode Island legislators to pass the casino bill is the current action in Massachusetts on gambling expansion that has prompted two versions of a gambling bill, one in the House that was passed in April, and the other in the Senate that is still being discussed. He said state legislators are claiming that millions of gambling dollars are leaving Rhode Island to casinos in neighboring states, particularly in Connecticut where Foxwoods Resort Casino and Mohegan Sun are attracting Rhode Island residents.

Carcieri’s spokeswoman, Amy Kempe said the governor will decide whether to veto or to sign the bill probably late this week or early next week. If the governor vetoes the bill, a two-thirds vote of both the House and the Senate would cancel the veto and make it ineffective.