PROVIDENCE — The House leadership has unveiled a reworked 20-year deal with IGT and its new partner, the Bally’s Corporation, to effectively run Rhode Island’s gambling empire.
The reworked Lottery deal “increases revenue to our state and preserves critical jobs,” the lead negotiator, House Speaker K. Joseph Shekarchi, said.
Simply put: the bill headed for a vote by the House Finance Committee on Thursday obligates the IGT-led partnership to 1,100 jobs in Rhode Island in exchange for exclusive control through 2043 of the technology that runs Rhode Island’s state-sponsored gambling, from the Keno machines at the corner store to the two glitzy casinos.
It also obligates Bally’s to create at least 30 new jobs at a “corporate headquarters” in Rhode Island by Dec. 31, 2022.
It is not yet clear if Bally’s – the new corporate name for the company formerly known as Twin River Worldwide Holdings – is making Rhode Island the center of its corporate world.
According to its website, Bally’s owns and manages 12 casinos across eight states, a horse racetrack and 13 authorized off-track betting licenses in Colorado.
A summary of the reworked package that Shekarchi negotiated says:
“The footprint for Bally’s commercial space in Providence has increased from 12,000 square feet to 20,000 square feet. … Bally’s has also agreed to open an additional Rhode Island office, outside the City of Providence, to hire a minimum of 30 information technology professionals.”
The Bally’s corporate office is located at the former Twin River home office at 100We have been there for almost two years.
“In addition to the increased jobs in the corporate headquarters, an additional 30 jobs – mostly IT-related – will be housed at an office outside of Providence. We have not yet selected a location,” spokeswoman Patti Doyle said.
The reworked bill also commits Bally’s to a $100-million expansion of the company’s flagship Twin River casino in Lincoln.
“The project entails the addition of 40,000 square feet to the gaming floor and a 10,000-square-foot spa and enhanced food hall area, built entirely by a union workforce,” said Elizabeth Suever, vice president of government relations for Bally’s.
If approved by lawmakers, Bally’s will officially evolve from a casino-operating company to one that provides video-slot machines, giving it a large source of the revenue now going to out-of-state game manufacturers and suppliers.
The legislation has been named in honor of Marc Crisafulli, who is battling cancer. Crisafulli is the executive vice president of Bally’s Corporation and president of its Rhode Island casinos.who is battling cancer.
Senate President Dominick Ruggerio on Tuesday thanked Shekarchi for making the legislation better, after an “exhaustive” earlier review by the Senate Finance Committee.
“Both leaders deserve an enormous amount of credit when this matter is completed,” said Jay Gendron, chief operating officer, lottery, for IGT.
“Passage of this legislation will keep IGT’s 1,000 good paying jobs in Rhode Island while adding another 100 and it will ensure that the gaming floor and its slot machines continue to drive over $300 million a year in revenue to the state.”
The stakes are high. State-sponsored gambling — including the live table-game action and video-slot play at the two casinos — has been Rhode Island’s third-largest source of state revenue.
It had been producing nearly $400 million a year for the state treasury until competitors in the region took a bite out of Rhode Island’s gambling revenue and COVID-19 forced temporary casino shutdowns.
IGT and Twin River each hired armies of lobbyists and spent millions debating the merits of the 20-year, no-bid deal first proposed by Gov. Gina Raimondo.
A full-page Sunday Journal ad In July 2019 launched Twin River’s campaign to convince Rhode Island lawmakers that the $1-billion deal Raimondo proposed for IGT would cost the state hundreds of millions of dollars in lost gambling revenue.
The proposed his deal encompasses all lottery/video lottery operations excluding sports betting.
Among the key provisions and changes from the last proposed version of the deal:
-The upfront payment to the state would increase from $25 million to $27 million.
-Both companies would pay a $7,500 penalty, instead of the $6,400 proposed earlier, for each job they fall short of their employment commitment.
-IGT and Bally’s must maintain headquarters in Providence through 2043.
-Bally’s will pay $200,000 more than required by the earlier version for “renaming rights” to a I-195 Commission park, including a total of $250,000 in the first year, $150,000 in the second year, and $100,000 thereafter.
-IGT’s overall “investment commitment,” goes from $150 million to $155 million with details to come.
-At least 6% of the gambling machines on the casino floor will be replaced annually. At least 5% of the total will be “the highly popular premium machines to keep the gaming offering on par with regional competitors.”
-All aspects of the lottery and gaming programs will continue to be state-operated, and the Rhode Island Division of Lotteries “will continue to maintain oversight and regulation of all gaming.”
-The promised financial commitment to problem-gambling treatment goes from $125,000 to a minimum of $200,000
-Although not contained in the legislation, the summary says: Bally’s and IGT have agreed to raise the minimum wage for its Rhode Island employees to $13 per hour by January 1, 2022; $14 per hour by January 1, 2023; and $15 per hour by January 1, 2024.”
-The aggregate payroll must now equate to 250% of minimum wage, which currently stands at $11.50 an hour.
At a $15 minimum wage, the total guaranteed payroll would be $85 million per year.
“Senate President Ruggerio brought both parties together at a time when the entire proposal was in question and Speaker Shekarchi facilitated and led closing negotiations to finalize this important economic development agreement. Both leaders deserve an enormous amount of credit when this matter is completed,” said IGT’s Gendron.