The House today will vote on whether to put the referendum on the November ballot.

07:55 AM EDT on Friday, June 25, 2004

BY KATHERINE GREGG and SCOTT MAYEROWITZ
Journal State House Bureau

PROVIDENCE -- The state Senate late last night gave its blessing to a casino referendum this November, after beating back efforts by one of its own members to pledge some of the promised new millions to school aid, sales tax relief and even the treatment of problem gambling.

The final 23-11 vote at 10 last night came hours after Governor Carcieri vowed to veto the legislation guaranteeing the Las Vegas-based Harrah's Entertainment an exclusive casino license if it can win over the state's voters. Today, the House gets its chance to vote.

Carcieri said the casino bill is "being pushed through this General Assembly, at the last minute, without adequate study and without giving the public an opportunity to understand the details."

"On Tuesday afternoon, with virtually no discussion, the House and Senate finance committees approved a casino bill that had been made public only minutes before. One senator actually had to ask for proceedings to be delayed so he could read the bill," Carcieri said. "Now, the General Assembly is rushing to pass the casino bill as quickly as possible, before anyone has an opportunity to fully understand its implications."

"If a casino bill passes both houses, that's a veto," he said.

A House fiscal analysis made public yesterday raised new questions about how much new revenue the casino might actually produce for the state. But its supporters talked again yesterday about the thousands of possible new jobs and the potential for upwards of $100 million annually in new state revenue. The Narragansett Indian Tribe is partnered with Harrah's and would get a cut of revenues estimated to be $20 million a year.

"I don't see how we can deny the people the right to vote," said the leading casino champion in the Senate, West Warwick Democrat Stephen Alves.

One of amendments proposed by Sen. Leonidas Raptakis, D-Coventry, would have required Harrah's Entertainment to pay Rhode Island $500 million, almost as much as it offered to pay Illinois earlier this year for a casino license. The legislation requires the payment here of $100 million over three years.

"There is probably no one in this room or in this state that can tell you how much a casino license is worth unless it was put out to bid," Raptakis argued. But, "for this state to sell a casino license for $100 million over three years . . . is not cutting it."

But one after another, his proposals were opposed by Alves.

Assuring Raptakis that he and other legislative negotiators had wrested a good deal from Harrah's, Alves, a vice president of investments at UBS Paine Webber, said: "Right now, their internal rate of return is at 10 percent. We do a $500-million casino license, they'd have a negative internal rate of return and I submit to you there is not a company in the world that is going to come in here with prospect of losing money every single year."

Raptakis said: "This legislation reminds me of the state going to a pawn shop and selling its future for whatever the pawnbroker offers us."

But his bid for a higher license fee was rejected by his colleagues on a 26-6 vote.

His attempt to dedicate 1 percent of the potential casino bounty to education went down, 18-12. The Senate also rejected his efforts to commit $1 million to the Rhode Island Council on Problem Gambling, instead of the $150,000 the legislation provides; provide a cut of the casino revenue to neighboring communities that expect a share of the police calls and traffic; and limit the size of the convention and sporting arenas Harrah's might try to build in the future. (Alves argued that the latter moves would be unconstitutional.)

The senators also rejected an effort by Republican Sen. Kevin Breene of West Greenwich to quell a gathering storm over promises the state made GTECH, the West Greenwich-based lottery manufacturer, that it would get a major cut of any new slot machines authorized by the state Lottery Commission.

"Please don't play Russian roulette with one of the best corporate citizens we have in the state of Rhode Island," echoed Rep. Leo Blais, R-Coventry.

Alves acknowledged that GTECH has made "significant investments" in the state, but he called the exclusive, 20-year lottery contract the state gave GTECH last year, after it threatened to move out of state, "the longest and most lucrative contract ever to be signed," and said it was worth "over $1 billion" to the company. The attempt to fold GTECH into the casino deal failed on a 24-7 vote.

At his own news conference earlier, Carcieri denounced the lawmakers for rushing a vote on a proposal "rolled out at the eleventh hour . . . [without] serious evaluation of what this is going to do. . . . I think it's disgraceful."

"In my judgment, the town of West Warwick and we, as a state, are being played like a fiddle by Harrah's. I mean, 'Give us a vote and then we'll negotiate.' Now that's got to be the silliest thing for us to do," Carcieri said.

"In fact, this so-called proposal, in my judgment, is a complete flimflam. There is no actual casino proposal," he said. "After months of hearings and thousands of dollars of advertising, we still don't know some of the most basic details about this project."

"What is this thing going to look like? Where is it going to be sited? How large is it going to be? What is the access in and out of it? What's going to be the impact on the town of West Warwick? What's the deal for the town of West Warwick? Do they know?"

"There's 100 questions," he said, "none of which are being answered."

Carcieri agrees with Assembly leaders that there are enough votes to pass the bill. However, he said, "an override is something else."

His comments drew this response from David J. Satz, vice president of governmental affairs and development for Harrah's: "I think the governor has not read the bill, which is very clear in putting out before the people who are going to vote on this project, very specific provisions regarding the plans for the casino, where it's going to be located, the impacts of it, the marketing of it."

Jeanne-Marie DiMasi, president of the West Warwick Town Council, also reacted: "I just think he thinks the people in West Warwick are morons. . . . I take offense to that."

"I know exaclty where the casino is going to go," said DiMasi, and "if the governor wants to take a ride, I'd be more than happy to show him. . . . I feel the governor does not have enough information, because he has not bothered to ask. . . . If he is concerned about what West Warwick is getting, he should ask West Warwick officials, and ask me. He has never done that."

When pressed, however, for details of the town's agreement with Harrah's, DiMasi said, "It's hard to give specifics at this point because we haven't agreed to everything yet. Not all of the council knows about it because only certain people have been working on this. We're trying to get the best deal for West Warwick. We would never shortchange West Warwick."