Casino

PROVIDENCE — The owners of the Twin River greyhound racetrack and slot parlor yesterday dangled $16.5 million annually in possible new state revenue from round-the-clock gambling before a governor and a legislature hungry to close a gaping budget hole.

In a private meeting yesterday morning with state Lottery Director Gerald Aubin, top executives at the Lincoln gambling hall laid out their in-house projections for how much more Twin River could produce annually for the state if it were allowed to remain open 24 hours a day, seven days a week.

Within hours, those projections had also been delivered to state Rep. William San Bento, the Pawtucket Democrat who chairs the legislature’s Lottery Oversight Commission.

The legislature’s biggest champion of expanded gambling, San Bento said: “We need the money. If this wasn’t this particular year, I think it might be a tough deal. But I honestly feel we are in such bad shape for money, anywhere we can get $16 million to $17 million, we better grab it.”

Among Twin River’s key assumptions: that staying open all night will produce a 10-percent spurt in revenue in what is now the final hour of operation, 1 to 2 a.m. It is projected that many of the 2,000 people at the gambling complex during that hour on a busy night will stay if they do not feel compelled to beat the closing-time traffic.

In that one hour, the owners expect to generate hundreds of thousands more in wagers — and a potential $892,000 more annually in net earnings for the state from 4,752 electronic gambling machines, including the newest draw: five-seat, “virtual blackjack” tables, where simulated dealers in tuxedos and low-cut bodices speak softly, make eye contact and occasionally wink at players.

“It’s like when you leave Fenway Park,” Aubin said. Unless the game is a cliffhanger, “you leave in the eighth inning because you want to beat the traffic.”

Over the next seven hours — between 2 and 9 a.m. — Twin River’s numbers-crunchers believe the dogtrack can draw enough night owls to generate another $15.6 million in currently unavailable video-slot revenue for the state.

If their rough projections are correct, the owners — and GTECH, the Rhode Island Lottery operator — also stand to make a bundle.

Here’s the way it works: the state gets about 61.5 cents out of every video-slot dollar left in the till after the players have been paid; the owners of Twin River and Newport Grand, about 27.5 cents. GTECH gets 7 percent as a game supplier, 2.5 percent as the “central system” operator for all the electronic gambling machines in Newport and Lincoln.

In the year that ended on June 30, 2007, that formula translated into $95.9 million for Twin River, $18.9 million for the owners of Newport Grand (which is not currently seeking to expand its operating hours), and a total of $24.6 million for the Rhode Island-based GTECH.

The Lott projects $290 million for the state this year from the acres of video-gambling machines and $303 million next year from players’ wagers at the two facilities.

Generating the kind of overnight business necessary to produce an extra $16.5 million for the state from Lincoln alone would boost Twin River’s bottom line by upwards of $7 million.

A Twin River spokeswoman insisted the owners — who are bankrolling the Mashpee Wampanoag Indians’ bid to bring full-fledged casino gambling to Southeastern Massachusetts — did not initiate the drive for 24-hour gambling to boost their business here or minimize Rhode Island’s potential losses to any new competitors across the border.

Spokeswoman Patti Doyle said “the legislature” initiated the conversation, not Twin River’s owners who include top executives in Kerzner International, the Waterford Group and the Starwood hotel and resort chain doing business here as BLB Investors.

After spending $220 million on renovations of the once deteriorating dogtrack, Doyle said Twin River’s owners were “willing and wanting to be respectful and cooperative with the state in finding new ways for revenue,” but “we never initiated the 24/7 dialogue.” But Aubin had this reaction when told Twin River’s owners were insisting the idea emanated from his division and the legislature, without any push from them: “Oh, c’mon. The state needs the money. BLB needs the money. C’mon. I mean, why would you do it if nobody needs the money?”

Aubin yesterday met with BLB’s chief executive officer George Papanier, chief financial officer Jay Minas, legal counsel Craig Eaton and Twin River’s vice president and general manager Craig Sculos and vice president of marketing Joe Malnerich.

What happens next is not entirely clear.

While bills have been introduced in both the House and Senate to allow round-the-clock gambling — seven days a week under one proposal, weekends and holidays only under another — both Governor Carcieri and the lawyer for the Lottery division of the new Department of Revenue contend no legislative approval is required.

While Carcieri “has not made a final decision regarding 24-hour gambling at Twin River,” his spokesman Jeff Neal said: “We believe that the Division of Lotteries can authorize extended hours at Rhode Island’s two gambling facilities.” Going a step farther, Lottery Division lawyer Robert Silva suggested Aubin could make the decision on his own, without public hearings or debate.

While “that is the law,” Aubin said: “I don’t operate in a vacuum. This is not something I would even think of doing on my own.”

Over the next two to three weeks, Aubin said, his staff will analyze Twin River’s projections and then he and his boss, new Department of Revenue Director Gary S. Sasse will bring their findings to “the attention of the governor.” Will he take his cue from the governor? “Absolutely. Positively,” he said.

At this point, Carcieri’s official position is he neither supports nor opposes 24-hour gambling at Twin River. “However, before an expansion of gambling hours is authorized, the governor would prefer to see Twin River work with the local residents to resolve any concerns,” Neal said.

From conversations that have taken place behind the scenes in recent months, another top aide to the governor said: “We know there are certain people in the General Assembly who feel that we should do it. Twin River made it known that they are interested in having it done,” and “I think the governor feels that it is fair to at least give it [a try] on a trial basis.”

Last night, House Finance Chairman Steven Costantino said he would ask his staff to review the numbers, but “I think it at least should be started at a minimum in a pilot situation — at a minimum.” Would such a move require legislative approval? “I believe it doesn’t,” he said.

While Lincoln voters objected to overnight gambling in a non-binding November referendum, the high-level insider said Twin River’s owners are not interested in extending their liquor-serving hours, which may allay one local concern, and the Lincoln police chief and town administrator have acknowledged that all-night gambling might reduce the congestion emanating from Twin River now at closing time. “I don’t think there is a large amount of resistance right now,” he said, largely because of the state’s budget deficit and “the fact that they are not going to extend the liquor license.”

“I think it’s something that over the course of the next few months, we’ll continue to discuss and see if there is a desire to do it,” he said.

Lincoln Town Administrator T. Joseph Almond said he has no way of gauging how much traffic might come into Lincoln as the night scene in other communities closes down. “It is currently manageable,” he said. Depending on the specific proposal, “it might not be.”

With reports from Cynthia Needham of the Journal State House Bureau

kgregg@projo.com