GA approves 20-year IGT/Bally’s lottery agreement

Updated at 4:40 p.m., June 1, 2021

THE R.I. SENATE approved legislation Tuesday that would pave the way for the state's 20-year lottery agreement with International Game Technology PLC and Bally's Corp. / PBN PHOTO BY CASSIUS SHUMAN
THE R.I. SENATE approved legislation Tuesday that would pave the way for the state's 20-year lottery agreement with International Game Technology PLC and Bally's Corp. / PBN PHOTO BY CASSIUS SHUMAN

PROVIDENCE – The Senate on Tuesday voted, 28-5, to approve the IGT/Bally’s Corp. agreement for a 20-year deal to run state-sponsored gambling services.

Passage of the legislation affects the state’s third-largest revenue stream, income from the state’s two casinos and the R.I. Lottery.

Having already been approved by the House, the measure now moves to Gov. Daniel J. McKee for his signature. Previously, he has expressed his support of the contract.

The Senate vote took place Tuesday afternoon at Rhode Island College’s Sapinsley Hall in Providence, as members continue to observe social-distancing protocols.

- Advertisement -

Sen. Ryan W. Pearson, D-Cumberland, chairman of the Senate Finance Committee, said the legislation went through an open, public, transparent vetting process and will promote economic development for the state.

“It started out as a war – but I thought it was appropriate for all the parties to come together on this agreement,” he said, noting that the measure comes with job creation requirements and regulatory oversight.

Sen. Samuel W. Bell, D-Providence, disagreed, saying the state made a deal that was good for IGT and Bally’s Corp., but bad for Rhode Islanders.

Sen. Jessica de la Cruz, R-Burrillville, said the state should have put the contract out to bid, and she voted against passage.

The amended legislation approved by the House in a 62-11 vote last month, after eight proposed amendments by Republican leaders were voted down.

House Minority Whip Michael A. Chippendale, R-Coventry, said that the agreement locks the state into a technology bill for 20 years, while House Minority Leader, Blake A. Filippi, R-New Shoreham, called the contract “a corporate giveaway.”

Rep. Carol Hagan McEntee, D-South Kingstown, chairwoman of the House Committee on Small Business, said the agreement is “economic development” for the state.

The 20-year agreement would require IGT – formally known as International Gaming Technology PLC – to pay the R.I. Department of Revenue $27 million, of which $13.5 million is due by June 30, 2023, and $13.5 million is due by June 30, 2024, for the right to be the exclusive provider of products and services related to the state-sponsored gambling operations.

Per the agreement, the Department of Revenue would be obligated to compensate IGT with 5% of annual sales up to $250 million; 4% for sales between $250 million and $400 million; and 5% for sales greater than $400 million.

IGT holds a 60% majority interest in the venture, while Bally’s Corp. is entitled to 40% of the operation.

Bally’s would pay $250,000 in the first year, $150,000 in the second year and $100,000 thereafter, for “renaming rights” to an I-195 Redevelopment District Commission park.

IGT would be required to create 1,100 jobs in the state for the exclusive control of the state’s gambling system. It obligates Bally’s Corp. to employ no fewer than 30 new senior management employees at a corporate headquarters in the state by Dec. 31, 2022.

IGT and Bally’s Corp. would incur a $7,500 penalty for each job that they failed to employ under the terms of the agreement.

The legislation also calls for Bally’s Corp. to expand its Lincoln casino by 50,000 square feet at a cost of $100 million, and obligates the company to lease at least 20,000 square feet of commercial space in Providence through the extended expiration date of 2043.

IGT and Bally’s must maintain headquarters in Providence through 2043, when the agreement is set to expire.

Lincoln-based Bally’s Corp. owns and manages 13 casinos in eight states, a horse racetrack and 13 authorized OTB licenses in Colorado. With more than 6,000 employees, the company’s operations include 13,308 slot machines, 460 game tables and 3,342 hotel rooms.

International Game Technology PLC, formerly Gtech S.p.A. and Lottomatica S.p.A., is a multinational gambling company that produces slot machines and gambling technology. The company is headquartered in London, with offices in Rome, Providence and Las Vegas.

(Updates with the Senate vote on the legislation.)

Cassius Shuman is a PBN staff writer. Contact him at Shuman@PBN.com.

Purchase NowWant to share this story? Click Here to purchase a link that allows anyone to read it on any device whether or not they are a subscriber.

No posts to display