R.I. Casino Referendum Fight Expected to be Robust

The Rhode Island legislature has placed a measure on the November ballot that would allow the Newport Grand Casino (l.) to add table games. A robust election campaign is expected.

“I am so anxious to take that ‘Slots’ name off,” said a potential investor in the Newport Grand casino in Rhode Island last week. “That’s where we start.”

The potential investor is Joseph Paolino, former mayor of Providence, who, with a group of like-mined investors, wants to spend some money on turning the Grand into a Las Vegas style property. He would allow like to add a music venue, shops and a spa.

The legislature has placed a referendum on the November ballot that would allow him to do that. Coming scant years since Newport voters rejected a similar referendum, the measure that would allow Newport Grand slots parlor to add table games is expected to be hotly contested.

A companion referendum would prevent casinos from changing location without the approval of the voters of the city where the casino is located.

Governor Lincoln Chafee signed the referendums into law last week, putting it on the November ballot. If the vote is approved statewide and Newport voters also approve it, the Newport Grand would be able to become a Las Vegas style casino. This would make it attractive for a consortium of investors, led by Paolino, who have pledged to buy and spend $40 million renovate the property if they are allowed to add table games.

The governor signed the bill, although he objected to a portion of the law as violating the state constitution’s separation of powers.

Under the provisions of the referendum, the city would be guaranteed $1.5 million annually from the casino’s profits for the first six years, and $1 million thereafter.

The state’s two casinos are the third largest soured of revenue in the Ocean State. Net slots revenue from the Newport Grand has fallen from $79.4 million, its highest level, in 2005, to $40.8 in the just concluded fiscal year. The state collects 61 percent of slots profits.

Supporters hope that the additional sweeteners will turn the minds of some Newport voters. The city rejected a similar measure two years ago. Paolino, who has conducted some private polling, says the electoral dynamics has changed enough that he is confident of winning the vote this time. He expects that the promise of new jobs will be the winning selling point.

The 2012 election was close. Newport voters defeated it 4,578 to 4,071 after the Newport Grand spent over $440,000 and the opposition spent near $80,000.

It remains a closely argued issue. The city council voted 4-7 to ask the legislature to put the measure on the ballot.

Opponents say that gambling is the wrong way to finance government. Maureen Finneson, a schoolteacher, calls gaming, “a morally reprehensible way to raise money for the government. . . We have so many other wonderful attractions here in Newport. Do we really need to be known for something sleazy like gambling?”