PROVIDENCE – The House Finance Committee opened a hearing Wednesday to review enabling legislation that would authorize a combined entity of International Game Technology PLC and Twin River Worldwide Holdings Inc. to run the state’s lottery.
The hearing quickly got into fine details of the proposed legislation, which would allow the two companies to form a joint venture that would oversee and maintain the video lottery terminals at the state’s two casinos.
No vote was taken at the initial hearing. If authorized, the changes would be made a part of a new, 20-year extension of the lottery contract.
The joint venture would be owned on a 60-40 split by IGT and Twin River, respectively, and would begin on Jan. 1 2022 if approved.
The hearing began with a brief overview of the House legislation, filed as bill 2020-H 7523, by the fiscal advisor Sharon Fernald. She reviewed some of the changes made since IGT made its original request for a 20-year extension of its lottery contract.
The legislation would not significantly change some traditional lottery services, such as scratch tickets, she said, but would alter the arrangement for revenue gained from the terminals within the casinos owned and operated by Twin River.
The General Assembly is being asked to approve enabling legislation, which would authorize the R.I. Department of Revenue to negotiate and execute a contract with the companies that would follow the terms set by the legislation.
Under the proposed agreement reached by the companies in January, IGT would commit to maintaining 1,100 jobs in the state with an aggregate annual payroll of 250% of minimum wage. It would invest $150 million into new terminals and pay the state $25 million in license fees. Twin River would pay $6.5 million of that license fee.
In other investments, the agreement also calls for a renovation and expansion of the Twin River Casino Hotel in Lincoln, with 40,000 square-feet of additional gaming space. An analysis has not been conducted describing the impact this would have on state gaming revenue, Fernald explained.
IGT Chairman Robert Vincent, who sat beside Marc Crisafulli, CEO of Twin River, through the hearing Wednesday, described the arrangement as a good compromise. The agreement followed months of animosity between the two companies, after Twin River challenged IGT’s efforts to secure a 20-year renewal of its lottery contract.
“We began a process of erasing what was put on the blackboard,” Vincent said, of the negotiations to reach a solution. “The turning point came when Twin River came forward with a significant investment in its facility. Concessions were made on both sides. That’s usually the sign of a good compromise.”
Mary MacDonald is a staff writer for the PBN. Contact her at macdonald@pbn.com.
