murphy

PROVIDENCE — While Governor Carcieri appears to have closed the door to a potential state takeover of the Twin River greyhound track and slot parlor, House Speaker William J. Murphy has left his door open –– “if the number was right.”

The Lincoln gambling hall, with 4,752 video slots, is owned by a subsidiary of BLB Investors, which bought the Lincoln Park dog track in 2005, and then embarked on a $225-million renovation and expansion.

Since March 2008, however, when they first defaulted on their loan payments, the owners have been struggling to keep their lenders and contractors at bay while avoiding bankruptcy court.

Murphy, D-West Warwick, said Tuesday he did not necessarily agree with Republican Carcieri’s statement that it would not be prudent, given the state’s financial situation, to “add hundreds of millions of dollars of debt to the state’s balance sheet.”

With the state expecting $246.8 million in video-slot revenue from Twin River this year alone, Murphy said: “My concern is that the fiscal health of the state is protected, no matter what happens at BLB. I don’t think a bankruptcy is the best scenario. I hope BLB is not forced into bankruptcy.”

So, “if the number was right,” he said of a state buyout, “we would have to take a look at it and do a cost-benefit analysis.” He said the legislature might also consider lifting the legislative prohibition on construction of a hotel and other resort-style amenities at the track, which in 2005 were viewed as a potential threat to the Providence hotel market.

He similarly would not rule out action on state Rep. William San Bento’s call for a public referendum to allow full-scale casino gambling at both Twin River and Newport Grand, saying “we have to keep all options open.”

While Murphy’s statements were consistent with his earlier comments, they underscored the extent to which lobbying and decision-making had moved to the legislative arena since Twin River’s announcement Monday that the Carcieri administration had broken off talks on a financial rescue plan.

Senate Majority Leader Daniel Connors Tuesday echoed the governor’s concern about spending hundreds of millions of dollars to buy a gambling facility.

But Connors said he believes there is still a possible role for the state and the legislature.

Murphy has said the only option he would not consider is cutting the state’s share of the revenue –– close to 60 cents out of every dollar left behind by losing players at Twin River.

But George Nee, secretary-treasurer of the AFL-CIO, nonetheless raised that possibility, saying Tuesday that the state should consider reducing its take if that will save “about 500 union jobs up there” and help head off a bankruptcy filing, which, he argued, would cost the state money.

“I don’t think it’s a good strategy to wait and see what happens,” he said. “I think it is something that should be pursued,” he said.

Meanwhile, Gary Sasse, who has been doubling as director of both the Department of Revenue and Department of Administration, shed some light on what was discussed during the months of closed-door talks.

He acknowledged, for example, that there was consideration of a consensual state takeover with the state hiring a management company to run the slot parlor.

“The position we are in today is that we think that given the current fiscal situation, given the economy, that it would not be prudent at this point to proceed,” he said.

He would not disclose the potential terms under discussion, but he said the administration was aware that if it decided to hire a management company to run Twin River, it would have to decide whether competitive bidding was necessary. On that note, Harrah’s Entertainment — having lost its West Warwick casino bid in a 2006 public referendum — has signaled its interest in taking over the management of Twin River, should that opportunity open.

“We’d certainly be interested if that became available,” said Jan Jones, the former Las Vegas mayor who was the face of Harrah’s in Rhode Island, by telephone Monday. “We’ve always been big believers in the long-term benefits of being in the Rhode Island market.”

Attorney General Patrick C. Lynch, in a news release Wednesday, said state officials should view a bankruptcy filing as “a last resort,” and think twice before “entering into a bidding process for the property.”

“Bankruptcy should be viewed as a last resort,” Lynch said in his statement. “The many unsecured creditors who may go unpaid as the result of a bankruptcy by Twin River include contractors and subcontractors as well as other vendors who have provided goods with the full expectation that payment would be forthcoming, and who operate their businesses on a tight margin made even tighter by the economic recession. For these small businesses, as well as for the 500 people who work at Twin River, the consequences of a bankruptcy could be devastating.”

kgregg@projo.com