The release of a document called "The Terms of the Agreement" comes one day after an anticasino group calls attention to questions surrounding the partnership.

05:09 PM EDT on Wednesday, July 12, 2006

BY KATHERINE GREGG
Journal State House Bureau

PROVIDENCE -- Promoters of the proposed Harrah's-Narragansett Indian casino tried yesterday to head off any further controversy over the unseen agreement between the tribe and its Las Vegas financial backers by releasing a document titled: "The Terms of the Agreement."

A late-day e-mail from the Harrah's-based group calling itself Rhode Islanders for Jobs and Tax Relief spelled out several potential benefits to the 2,400-member tribe, including a previously disclosed 5-percent share of the after-tax revenues, job preferences, initial contributions of $300,000 and then annual contributions of at least $75,000 to special health and education funds for the tribe.

Tribe lawyer Jack Killoy acknowledged that the 1 1/2-page document is an after-the-fact summary of the "fairly lengthy agreement" the tribe struck with an entity called the Harrah's West Warwick Investment Company on Aug. 26, 2005.

Asked why the tribe and Harrah's did not make the full agreement public, Killoy said the tribal council feels the operating agreement contains "some proprietary information relative to their proprietary, internal issues."

He would not elaborate, but said the tribe had "gone to great lengths to disclose more than most tribes" are required to disclose, under the federal rules governing Indian casinos on tribal lands, which this is not.

"I think the document we provided speaks for itself," he said. "It shows that the tribe has a very lucrative financial arrangement with the largest casino company in the world which will provide not only the tribe, but the state, substantial economic benefits . . . and job opportunities."

But spokesmen for the opposition group, Save Our State, called the release of "their own Reader's Digest version of the agreement" an "insult" to voters being asked to provide, in the state Constitution, exclusive operating rights to the tribe and its unnamed "chosen partner" in the proposed West Warwick casino.

Said SOS campaign manager Tim Costa: "They want the voters of our state to amend the Constitution, but they don't want to release the agreement they want to make part of the Constitution. . . . They ought to have the decency to release the whole agreement."

Yesterday's late-day attempt by the casino promoters comes one day after SOS' effort to draw attention to the unanswered questions surrounding the partnership.

In a public letter to Harrah's senior vice president Jan Jones, Costa asked a series of questions, among them: "Does this revenue stream include all revenue, both gaming and other, such as hotel, restaurant and retail? Does your partner have any management rights or does voting and decision making power reside solely with Harrah's? What of the right to buy Harrah's out in fifteen years, how does that provision apply?

"Is this a true partnership or one so weighed to one party that it is a 'partnership' in name only? "

Killoy yesterday said the tribe's share is based on both gaming and non-gaming revenue. He said Harrah's is the "managing member" of the limited-liability corporation that would own the casino but the understanding is that "the tribe and Harrah's will consult on decisions with regards to development, operation and management."

Asked if this is, as the opposition suggests, "a partnership in name only," Killoy said "in every business arrangement, every party brings something different to the table." In this case, he said, the tribe "brings to the table 10 years of efforts putting forth a casino in the state of Rhode Island, relationships in West Warwick, and the land on which the project is going." He said the tribe is also carrying more than $10 million in debts "they need to repay" on the investments made by its pre-Harrah's casino partners.

The summary made public yesterday shows the tribe getting an initial 5-percent share of the casino revenue, after the payment of "gaming taxes" but before the payment of any other expenses. Their share rises to 5.5 percent when the casino grosses $800 million, as long as earnings before taxes, interest, depreciation and amortization exceed 24 percent, and to 6 percent when the gross exceeds $1 billion and EBITDA exceed 26 percent.

Killoy said projections suggest the tribe could get $20 million of the projected $45-million owners' share by the casino's third year.

But after reading through the summary last night, Gary Sasse, SOS member and executive director of the business-financed Rhode Island Public Expenditure Council, said: "It raises more questions than answers. It is not transparent."

As an example, he said: "What is meant by gross revenue? Gross gaming revenue or total gross revenue from all activities. . . . How you define that makes a significant difference."

Shortly after 7 last night, Killoy released a statement in which the Narragansetts' Chief Sachem Matthew Thomas said the tribe had "always planned on releasing the terms of this agreement in advance" of a news conference tomorrow where "we are eager to tell our story to the people of Rhode Island and share with them the many benefits that this project will bring to our state and my Tribe."

kgregg@projo.com / (401) 277-7078