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Casino deal threatens taxpayers

01:00 AM EDT on Monday, October 2, 2006

Scott Mayerowitz's Sept. 25 article ("Safety net for current slot halls: Taxpayers," news), about the safety net that the Rhode Island General Assembly gave Lincoln and Newport in the so-called slippage clause, understates the huge financial exposure the state faces if it allows a new gambling facility.

The slippage clause is triggered when the state agrees to permit another casino such as Harrah's. Once that happens, Lincoln and Newport will be protected against any drop-off in business, regardless of the cause! No distinction would (or could) be made between losses caused by Harrah's and a general fall-off in business due to economic conditions, earthquakes, hurricanes, or even the impact of a new casino in Massachusetts, if one should be built.

I spotted the problems with this language when it first appeared in the House bill, and did some calculations of the potential cost. I described those costs in great detail during the debate in the House. Since the future is unknowable, the only way the state can protect itself would be to require Harrah's to take full responsibility for the slippage payments to Lincoln and Newport. Deputy Finance Chair Paul Crowley stood and reinforced my remarks, by agreeing that any new operator must be required to take that risk.

No members who voted to approve the Lincoln-Newport deal last year can claim that they were not warned about the potential risk. We cannot afford to ignore that obligation now.

LAURENCE W. EHRHARDT

North Kingstown

The writer is a Republican state representative.

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