PROVIDENCE — Should Rhode Island voters have a chance to say yea or nay to full-scale casino gambling at Twin River and Newport Grand?

That question will be up for debate Wednesday when the Senate Committee on Constitutional & Regulatory Issues holds a public hearing on a bill to put that question on the ballot during the next statewide general election.

In 2006, voters rejected a proposed Harrah’s-financed Narragansett Indian casino in West Warwick. The defeat was attributed, in part, to the vagueness of the proposal, which did not even include a proposed tax rate, and the inclusion of a “slippage clause” that would have required the state to compensate the two existing slot parlors for any losses attributable to competition from a new Rhode Island casino.

This year’s proposal by Sen. John J. Tassoni Jr., a business agent for Council 94, American Federation of State, County and Municipal Employees, seeks to amend the state Constitution to allow casino gambling at Twin River and Newport Grand only.

The legislation cites the threat that Mass-achusetts will approve casino gambling — or slots at its own tracks — exacerbating Rhode Island’s budget crisis by snatching away the Bay State gambling dollars currently being spent here. It also starts from the premise that “the establishment of a casino would generate substantial tax revenue and other economic benefits for Rhode Island, including the creation of jobs and the stimulation of capital investment.”

“I think it is time. We don’t have enough revenue for the budget. I believe this would help,” said Tassoni, D- Smithfield, in an interview earlier this year when he first introduced his legislation, cosponsored by two other senators with organized labor ties: Frank Ciccone, D-Providence, and Majority Whip Dominick Ruggerio, D-Providence. Both work for arms of the Laborers’ International Union of North America.

The hearing comes at a critical time for Twin River, especially.

The owners announced through a spokeswoman a week ago that the dire circumstances that led it to miss loans payments in March 2008 were just as dire now, but the governor’s office had “broken off all discussions with the owners of Twin River — BLB Investors, LLC. — regarding the possible state takeover or purchase of the gaming venue.”

It remains unclear why the talks broke down, after months of negotiations between Twin River, its lenders and the state’s financial advisers.

But Governor Carcieri’s office issued this statement at the time: “After lengthy discussions, the state has decided that given the state’s current fiscal situation, it is not prudent to enter into a transaction that would add hundreds of millions of dollars of debt to the state’s balance sheet.”

Twin River spokeswoman Patti Doyle would not say what options Twin River’s owners were exploring. But given the slot parlor’s year-long struggle to keep its lenders and contractors at bay, this latest development, at the very least, raised the possibility they would seek protection from their creditors with a filing in U.S. Bankruptcy Court.

Wednesday’s hearing begins at the end of the regular 4 p.m. Senate session.

A second bill on the Senate committee’s agenda would lift the exemption the two slot parlors have from the statewide workplace smoking ban. A third, drafted by members of the Rhode Island Council on Problem Gambling, would extend to Twin River and Newport Grand the same problem-gambling aversion requirements that state lawmakers adopted in 2004 for the proposed West Warwick casino.

At its most basic, it would require the slot parlors to submit to the state Lottery a written plan which, at minimum, provides an opportunity for compulsive gamblers to voluntarily — and permanently — exile themselves from the premises, with the knowledge they will have to forfeit their winnings if they get caught sneaking back in.

kgregg@projo.com