It’s Table Games or Die at Twin River
Saturday, December 10, 2011
Lincoln-based Twin River stands to lose about 35 percent of its annual revenue when three resort-style style casinos and a slot parlor open in Massachusetts, but the board Chairman John Taylor says the casino is unlikely to face a “doomsday scenario” as long as Rhode Island voters to approve table games next November.
In an interview with GoLocalProv this week, Taylor said he believes the facility, which currently features only slot machines and virtual table games, can survive as a “convenience casino” if table games are implemented. The table games, he projects, will bring in about $100 million in additional revenue for Twin River.
“We’ve got a property that is outperforming its competitors,” Taylor said. “We just need extra tools in our tool box.”
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Taylor said Twin River could have table games up and running about 120 days after voters approve the plan next year, which he believes would give Rhode Island a leg up on Massachusetts, which could take several years to actually open any casinos. He said states like Pennsylvania and Maryland have had trouble moving forward with their gaming operations in recent years and the Bay State could face the same problems.
“I still think we could be about 1 1/2 – 2 years ahead of the commonwealth on this,” Taylor said
Taylor said the key focus for Twin River is to remain convenient and to have the best customer service possible. The idea is that while people will certainly want to try out any brand new casino that is close by in Massachusetts, they’ll eventually turn back to Twin River.
Still, there has been plenty of concern for what could happen to Rhode Island’s gaming revenue when more competition comes to New England. Estimates show that the state could lose more than $100 million annually from Massachusetts-based competitors.
Not Doomsday
For Twin River, which Taylor says emerged from bankruptcy in 2010 having cut its deficit in half and has increased profits 25 of the last 26 months, the challenge is clear.
“We are concerned. Of course we are concerned,” Taylor said. “But this is not a doomsday scenario. We could compete with those casinos.”
But others have said Rhode Island missed its opportunity on gaming and is now going to suffer the consequences when Massachusetts ultimately opens its casinos. Governor Lincoln Chafee last month issued a statement saying the state must protect the nearly $300 million in revenue it generates from Twin River, Newport Grand and the lottery.
“Given the significance of that revenue stream, I have been closely following the debate in the Massachusetts House and Senate over the question of allowing casino gambling in the Bay State,” Chafee said. “I have anticipated for some time that today would come and my administration has taken proactive steps in preparation for it.”
He continued: “ We are prepared for competition – whether it comes from Massachusetts, Connecticut, or New Hampshire – and I remain fully committed to protecting this vital source of revenue.”
However, Jan Jones, Senior Vice President of Communications & Government Relations for Caesars Entertainment Corporation and the former Mayor of Las Vegas, told GoLocalProv that when Rhode Island had the chance to open its own resort-style casino, special interests got in the way.
“They had it all,” Jones said. “Rhode Island was a wonderful destination. They could have had it up and running by now. But they threw it all away."
Get Table Games Passed
Taylor said he doesn’t believe the naysayers on gaming in Rhode Island and the state should focus on one task at a time. Currently that means getting table games passed next November. If the state wants to push forward on expanding the property afterward, he said he would be willing to have the conversation.
“The competition is coming and we need to think about that,” Taylor said. “Any time you bring more supply into the equation, you are concerned. But we believe we can remain competitive.”
The casino currently employs about 900 people and Taylor said it didn’t have to slash staff during the bankruptcy process. Not only is it Rhode Island’s third-largest revenue source, it’s also among the state’s largest employers.
That’s why Clyde Barrow, a director for the Center for Policy Analysis at UMass-Dartmouth who has long advocated for gaming in Massachusetts, has said the fiscal impact on Rhode Island of expanded gambling in Massachusetts could be dire for taxpayers.
“Massachusetts residents now account for more than half of all visitations to Twin River and Newport Grand, and they almost certainly account for a similar proportion of spending,” Barrow told GoLocalProv in September. “These are mostly convenience gamblers, who will almost immediately shift their spending to closer gaming venue if one becomes available. Thus, depending on where Massachusetts locates its gaming venues, Rhode Island could lose approximately $100 to $150 million annually in tax revenues that are now generated by its two slot parlors.”
The Future
But Taylor remains upbeat. He said getting tables games passed will create $165 million in additional economic impact in Rhode Island and while the competition will certainly hurt business, he believes people enjoy the product Twin River offers and will ultimately return.
So where is the casino a decade from now?
“We’ll be effective competing in a vibrant New England gambling market,” Taylor said. “We just need the extra tools.”
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