A few months after Rhode Island legalized sports betting, the state’s sports betting pool was $900,000 in the red due to getting stung by the Super Bowl. Last week the legislature voted to more than double the size of credit extended to bettors: $100,000.
In 2014 the legislature voted to legalize extending interest free unsecured casino credit up to $50,000. The most recent vote doubles that.
The bill’s language emphasized the need to “preserve and protect” the ability to maximize profits at the state’s two casinos in Lincoln and Tiverton, both operated by Twin River. “The extension of credit to casino gaming and video lottery players is a vital customer service function that facilitates a gaming program’s long-term success,” said the bill.
There are regulations in place to minimize the chances that a financially unstable individual will be granted credit.
Rhode Island has had a rocky first few months of sports betting. Officials predicted the Ocean State would realize about $23.5 million in taxes for this fiscal year. The real amount was $2.65 million. One problem is that the state overestimated how popular retail sports book would be.
In New Jersey, for example, 80 percent of revenues comes from mobile sports betting. For Nevada the figure is two-thirds. Rhode Island adopted mobile sports betting in March, but hasn’t rolled it out yet.
The idea is that friends could watch sporting events at a local bar or restaurant and place wagers at the same time; instead of having to visit one of the two casinos to do so.
Meanwhile, a group of GOP attorneys have sued in state court to challenge the legality of the state’s sports betting law. They argue that the state constitution requires that the voters explicitly vote for a new form of gaming.
The attorneys are Joseph Larisa, former GOP state chairman, and Brandon Bell. They represent Daniel Harrop, who once ran for mayor of Providence. They filed their bill in Superior Court two weeks ago. They cite a 1994 amendment to the constitution that requires a vote of the people for any new type of gaming; both statewide and in the host city. They are also challenging the online sports betting bill, passed but not yet rolled out.
Larisa portrays the court battle as “David Vs. Goliath” contest: “They’re going to throw the kitchen sink at this because they have a major vested interested in this. All we’re fighting for is to let the people vote – that’s all we want.”
A spokesman for Governor Gina Raimondo downplayed the challenge. Josh Block told reporters, “Multiple legal opinions have affirmed that sports betting was already approved by the voters,” adding, “Revenue from sports betting supports investments in education, health care, infrastructure and more, and we remain confident that it will be upheld in court.”
The legislature acted last year after the U.S. Supreme Court lifted the federal ban, declaring Professional and Amateur Sports Protection Act (PASPA) unconstitutional. It amended existing gambling laws to allow sports book. However, the GOP lawsuit argues that is not enough.
The complaint quotes from the 1994 constitutional amendment: “No act expanding the types or locations of gambling which are permitted within the state or within any city or town therein or expanding municipalities in which a particular form of gambling is authorized shall take effect until it has been approved by the majority of those electors voting in a statewide referendum and by the majority of the electors voting in said referendum in the municipality in which the proposed gambling would be allowed.”
The lawsuit notes that previous changes, such as adding table games in Lincoln, followed the law. IN 2011 voters in Lincoln approved tables, while Newport did not. This led to Twin River moving its casino to Tiverton, where voters in 2016 approved of gaming, including tables.
The legislature in fact used the 2011 vote as justification for authorizing sports betting. However the plaintiff point out that this law, while authorizing Class III gaming, did not mention sports betting, because sports betting wasn’t legal at the time.
Harrop argues that his purpose is to hold the government accountable. He declared, “The General Assembly and the governor have refused to follow our state constitution by seeking voter approval before expanding gambling in the form of sports gambling,” he said. “This is a good government issue. If one provision of our constitution is disregarded, then none is safe.”
