Politics
4:48 am
Tue June 8, 2010

RI House committee to vote on casino bill

Providence, R.I. – The House Finance Committee plans to vote today on a bill that would ask voters next November to approve casino gambling in Rhode Island.

Gambling is the state's third-largest source of revenue. So plans to create three resort-style casinos in Massachusetts have added fresh urgency to the casino issue here in Rhode Island - according to Gary Sasse, who used to be the state's revenue director.

"There's about 250 to 300 million dollars on the line that we have to protect," Sasse says. "And if we don't protect that it will be a negative impact on economic development because it will be either less to provide for essential services that we need or we'll be faced with pressure for increased taxes."

The General Assembly has responded with a bill that could turn Twin River in Lincoln and Newport Grand into full-fledged casinos. The two facilities already have thousands of video lottery terminals, but they lack the table games of places like Foxwoods and Mohegan Sun in Connecticut. Sasse says with Massachusetts about to jump into the casino gambling game, Rhode Island needs to respond.

"I would call it a high-stakes game," Sasse says. "Rhode Island is going to need to be agile, on its feet, not wait to react and recognize that Massachusetts' advent of casino gambling will create a real challenge for us."

But University of Rhode Island economics professor Leonard Lardaro cautions that expanding casino gambling might not be the best way to put the state's fiscal house in order.

"There might be a set of actions in motion where we're going to take another revenue hit no matter what we do," Lardaro says. "So is that the best defense?"

Lardaro suggests the state might already be depending too heavily on gambling. And he says this reflects a failure of the state's elected leadership.

"Sadly, the fact that gambling is so prominent of a revenue source points to our failings over the last decade or so in really doing changes we know we should have made that we're only starting to do," Lardaro says.

Lardaro applauds a pending tax cut for Rhode Island's highest earners as a step to make the state more regionally competitive. But he says tuition hikes and funding cuts to state colleges undermine the goal of long-term economic development

"What are we basically going to continue to do - defunding public higher education, putting higher education farther and farther out of the reach of our people, which is just ridiculous," he says.

In 2006, Rhode Island voters rejected a casino proposal by the Narragansett Indians and Las Vegas-based Harrah's Entertainment. But former state revenue director, Gary Sasse, says the outcome could be different this time -- because the proposal involves facilities where gambling already exists.

"I think there's a quantum difference between the way the issue was handled in 2006 and the way it's likely to be handled going forward," Sasse says.

Sasse agrees that casinos aren't the economic salvation for Rhode Island. But he says, casinos - and protecting the gambling revenue that's already there - should be part of the mix. The legislature is expected to give voters a chance to have their say in this debate come November.