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With casinos closed, R.I. is watching its revenue evaporate and wondering how to recover

Twin River closed its Rhode Island casinos on March 14, and Governor Gina Raimondo has said they will remain shuttered until the state gets a handle on a virus that has now infected more than 5,000 residents and killed 155 people here.
Twin River closed its Rhode Island casinos on March 14, and Governor Gina Raimondo has said they will remain shuttered until the state gets a handle on a virus that has now infected more than 5,000 residents and killed 155 people here.Debee Tlumacki

PROVIDENCE – Remember when competition was the biggest headache for Twin River in Rhode Island?

Last August, the company that owns casinos in Lincoln and Tiverton announced it would lay off dozens of dealers after a decline in table game revenue was attributed to the opening of the Encore Boston Harbor casino.

Eight months later, the company is confronting an entirely different crisis. The coronavirus has forced the casinos to close indefinitely, sending hundreds of workers into unemployment and forcing state leaders to watch as Rhode Island’s third-largest source of tax revenue evaporates before their eyes.

Now, as the state and Twin River are both eyeing federal stimulus funds to soften the blow, they’re also bracing for the dramatic changes that social distancing regulations could bring to casinos if they’re going to be allowed to reopen any time in the near future.

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"They’re going to have to come up with a completely different business model,” said Richard McGowan, a Boston College professor who monitors the gambling industry. “Having six feet between slot machines would be death for Rhode Island.”

Twin River closed its Rhode Island casinos on March 14, and Governor Gina Raimondo has said they will remain shuttered until the state gets a handle on a virus that has now infected more than 5,000 residents and killed 155 people here.

While it’s the combination of all forms of legalized gambling, from Powerball and scratch tickets to sports betting and blackjack, that brings in more than $400 million for the state each year, the slot machines – or video lottery terminals – that generate the bulk of that revenue.

Those machines are packed together on the floor of any casino, and it’s not uncommon for players to sit shoulder to shoulder next to complete strangers at Twin River, close enough to inhale each other’s cigarette smoke or catch a whiff of perfume or cologne. Germs can spread fast in these spaces, and the most frequent visitors also appear to be the most susceptible to the virus: the elderly.

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McGowan said casinos across the country are going to have to rely more on entertainment and food service to bring in money in the future, and that’s not considered a specialty for Twin River, which relies heavily on “day hoppers” to visit its facilities in Lincoln and Tiverton.

It remains unclear when and how Twin River, which is publicly traded and also owns casinos in Colorado, Delaware, and Mississippi, plans to reopen. In March, the company told shareholders it was looking at options for closures of less than three months as well as shutdowns that could last significantly longer.

“In either case, the company is confident that it will have sufficient liquidity in excess of 12 months to meet all of its obligations including debt service, required capital expenditures and acquisitions,” Twin River said in a statement at the time.

Twin River has also been looking into whether it currently qualifies for federal aid through the stimulus packages that have already been approved by Congress, or through any future programs that are created.

Patti Doyle, a spokeswoman for Twin River, said the company is considering applying for a loan through the Federal Reserve’s Main Street Lending Program, which is designed to support businesses with fewer than 10,000 employees or had revenues of less than $2.5 billion in 2019 that have been adversely impacted by the coronavirus.

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In the meantime, Twin River has sought to remain a good corporate citizen. The Lincoln facility is offering its parking lot to CVS Health, which established one of the first rapid testing sites in the country there. More than 1,000 people are being tested each day.

With the state believed to be losing nearly $1 million a day with the casinos closed, both Raimondo’s office and House and Senate leaders say they’re keeping an eye on Twin River.

Josh Block, the governor’s press secretary, said the state is not planning to grant any stimulus money that it has received to Twin River, but he indicated that the Raimondo administration would support an additional federal allocation that is “specifically targeted at helping low-wage and hourly workers – many of whom are employed by Twin River.”

Senate President Dominick Ruggerio said he’s hopeful that another round of federal funding is made available soon.

"Federal aid so far has been targeted and included restrictions on its use,” Ruggerio said. “I am hopeful that there will be additional legislation enacted at the federal level that provides relief for states. It would be hard to overstate the severity of the budget challenges we face, and we are grateful to our federal delegation for their advocacy on this issue.”

When it comes to reopening, Raimondo has said a combination of factors – including a reduction in the spread of the virus, the testing capacity to identify another outbreak, and comprehensive plans to enforce social distancing – will all play a role in determining the timeline.

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Over the weekend, Wynn Resorts announced it will seek to reopen its Las Vegas locations in May by conducting temperature checks on guests, urging people to remain at least six feet away from each other, and requiring everyone to wear a mask.

McGowan, the professor at Boston College, said most casinos will need to craft their own plans before they open their doors. Even then, he said, it’s not certain that customers will be ready.

“It’s going to take a long time for people going to want to be close together,” McGowan said.


Dan McGowan can be reached at dan.mcgowan@globe.com. Follow him on Twitter at @danmcgowan.