PROVIDENCE – What began two years ago as an all-out war between Rhode Island’s gambling titans ended Friday when Gov. Dan McKee signed a 20-year, no-bid Lottery deal with IGT and the casino-operating company formerly known as Twin River.
The peace treaty the two Rhode Island gambling companies reached just before COVID shut down the state last year, ended Twin River’s sharp criticism of the deal, and set the stage for Friday’s bill signing.
In exchange for the 20-year contract extension, the new law commits International Game Technology to expanding and keeping a workforce of 1,100 employees in Rhode Island; a $155-million investment in technology upgrades, and new partner Bally’s to a $100-million expansion of the Twin River Casino in Lincoln.
It requires an upfront payment of $27 million.
Other features: Bally’s will pay the I-195 Commission for park renaming rights, starting at $250,000 in the first year, $150,000 in the second year, and $100,000 thereafter. For each job the partnership misses in its employment requirement, it will owe a $7,500 fine.
The companies are required to contribute at least $200,000 to problem-gambling programs.
“Although not contained in the legislation, 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,” spokeswoman Patti Doyle said.
“The companies have also agreed to open an additional Rhode Island office, outside the City of Providence, to hire a minimum of 30 information technology professionals.”
“This is an economic development success story that Rhode Island’s leaders should be proud of and should be able to say with confidence: “Yes, we did this,’ said Jay Gendron head of Lotteries for IGT.
“We kept more than 1,100 well-paying jobs here; brought in more than $250 million in investment; approved a $100 million renovation and expansion to protect the state’s third largest source of revenue; and ensured not one, but two companies continue to operate right here in Rhode Island for the next 20 years.”
“And all of this was accomplished during a once in a lifetime pandemic. You have to tip your hat to the leadership of this state who stepped up to make this happen,” he said.
The signing also marked a long-sought success for Bally’s top executive in Rhode island, Marc Crisafulli, mid-struggle with cancer.
In his prepared remarks, he said: “This has not been an easy time for me or my family. When I first heard the words ‘stage 4’, I was terrified. I came to realize that those words do not have to be the the end of the story, but are only a point in the journey at a particular moment in time.”
“I want to close by telling you about a phone call that meant so much to me. It was soon after I started my battle. I was in the hospital and I was down and struggling. Speaker [K. Joseph] Shekarchi was on the line. He told me of the plan to name the legislation after me.
“It provided me such a boost, and gave me the positive energy I needed to take this on. Thank you, genuinely, Mr. Speaker. Do you remember how you ended the call, Mr. Speaker? You said ‘Marc, we need you here for a long-time to live up to these commitments.’
“Well I told you then and I am telling you again now, I am not going anywhere. I am going to beat this. I look forward to working with you, President [Dominick] Ruggerio and Governor McKee for years to come! Thank you all, genuinely, for this honor and for this moment which I will never forget.
“Governor, let’s sign this bill!”
Bottom line: “The joint venture codified in the legislation only involves IGT and Bally’s and is majority controlled by IGT.”
The basic terms: the state Lottery – which technically runs the two casinos along with sports betting and more traditional Lottery games will pay:
*7 % of the “net terminal income” – after player payouts – on the acres of electronic gambling machines at the two casinos.
*2.5% of the net terminal income for the central operating system for the machines.
*32% of gross gaming revenue for the sports betting operation.
*5% of sales for the traditional Lottery games, such as instant tickets and Keno