The deal opposed
Twin River Worldwide Holdings, owners of the Tiverton Casino Hotel and Twin River Casino in Rhode Island, have come out in opposition of a state video gaming terminal (VGT) deal being pushed by Governor Gina Raimondo.
The $1bn (￡799,018,911.80) agreement would last for 20 years and include a no-bid process to allow International Game Technology (IGT) to provide services in the state. According to the Twin River group, the deal will cost the state lost revenues from the gambling industry.
Lost opportunity
Twin River took out a full-page ad in response to the deal being supported by Governor Raimondo in The Sunday Journal. In the ad, the company warned that Rhode Island will lose hundreds of millions in gambling revenues as a result. Without putting contracts out to bid, Twin River feels the state is losing out on a better deal.
If the proposal is passed by lawmakers, the lottery would get 85% of the more-than-5,000 electronic gaming machines from IGT. Currently, state law caps the number of machines at 50% from one company. Because of this difference, IGT would be given a larger portion of revenues.
Executive vice president of Twin River Worldwide Holdings, Marc Crisafulli, stated that taxpayers of Rhode Island should be ‘terrified’ of the deal. According to Crisafulli, the terms are bad and undermine competition.
In response, IGT Chairman Robert Vincent said: “To distill it down to, ‘Well, this is a no-bid contract for so many years’ is wrong. This is an economic development package that contains agreements that by and large extend our existing relationship, in return for a commitment by IGT to protect 1,100 good-paying jobs in the state, as well as our presence in our downtown headquarters, and the ability to pitch us on any expansion plans we have going forward.”
Details of the deal
The Governor’s office has stated that, with the continuation of the partnership with IGT, the state will receive hundreds of millions in local investment. As many as 1,100 jobs for residents of the state should be created with an average salary of $100,000 (￡79,879.23). The deal also includes an upfront payment of $25m (￡19,969,808.33).
The new deal with IGT was not presented via legislation until the day before the current legislative session ended in Rhode Island. Because of this, a special session to discuss its details has been planned for after Labor Day.
Right now, IGT has two contracts with the state. One is to operate the central operating systems for games, while the other is to provide the electronic gambling machines. Twin River is arguing that two other companies will bring more money to the state than IGT via gambling machines.
Everi and Scientific Games also operate in the state. Per machine operated by Everi, $66,000 (￡52,722.89) was produced for the state. Scientific Games was able to make $87,000 (￡69,498.35) annually per machine. These higher amounts are why Twin River is arguing that IGT should not receive an exclusive deal with no competing bids.