NORTH KINGSTOWN -- If a proposed West Warwick casino becomes a reality, it would take business away from Rhode Island's existing gambling venues and cause a revenue loss for the state, preliminary results of a Rhode Island Public Expenditure Council study show.

Gary Sasse, executive director of the business-backed policy research group, said the study shows that the casino would significantly cut into business at Lincoln Park and Newport Grand, lowering the state's revenue from the two locations.

It's a conclusion disputed by supporters of the casino proposed by the Narragansett Indian tribe and backed by Harrah's Entertainment. A prior study indicated that the casino would have little impact on revenue from the two gaming parlors, said Clare Eckert, a spokeswoman for Rhode Islanders for Jobs and Tax Relief, a Harrah's-backed pro-casino organization.

Sasse, however, said RIPEC's research is based on an assumption that Harrah's state-tax rate would be lower than the almost 60 cents of every dollar the state currently receives from the money spent on video lottery terminals at Lincoln Park and Newport Grand. The state generated $255.7 million in revenue from the machines at the two facilities last year, according to the Rhode Island Lottery.

In past years, Harrah's offered to pay the state 25 percent of the West Warwick casino revenue.

The casino would cause "a net revenue loss to the state," said Sasse. "The bottom line is, every model we look at there's serious shortfalls to state revenue over the next 10 years if this proposal goes through."

Sasse yesterday presented the preliminary results of RIPEC's six-month study at a Rhode Island Economic Policy Council meeting held at the Quonset Business Park. The EPC has already taken an official position opposing the casino, and after hearing Sasse's presentation voted again yesterday to reiterate its opposition. RIPEC is also officially opposing the casino.

The report is the latest volley in a statewide battle over the possible West Warwick casino. The General Assembly voted to put a question on the ballot in November, which, if approved by voters during the general election, would change the state Constitution to permit the casino.

RIPEC's full analysis of the possible economic impact of a casino is expected to be released later this month. However, Sasse also told the EPC -- which is made up of business and education leaders and cochaired by Governor Cariceri -- that RIPEC is concerned about changing the Constitution.

Sasse said the report questions how the state could "regulate an entity that's in the Constitution." Also, if Harrah's doesn't meet its business protections, "How does the state protect itself?" asked Sasse.

Eckert, with Rhode Islanders for Jobs and Tax Relief, said the report was not independent, that it was a "sham" study and that it wasn't "news that the EPC" had voted again to oppose the casino. RIPEC is financed by state businesses and Sasse is a member of the casino-opposition group Save Our State.

Eckert reiterated that the proposed 140,000-square-foot casino represents a $1-billion investment and 3,800 new casino jobs. In addition, it would provide $14 million in property-tax relief, he said.

"This is an economic development engine for this state," said Eckert.

However, Saul Kaplan, executive director of the Rhode Island Economic Development Corporation and a member of the EPC, said yesterday that he's "not convinced they are the kinds of jobs and wage levels we are after."

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