PROVIDENCE — Bally’s Corporation, the Rhode Island-based casino giant, on Wednesday launched a “major legislative initiative” aimed at allowing “online casino gaming, or iGaming,” in Rhode Island.
Craig Eaton, executive vice president and general counsel of Bally’s Corporation, made the announcement during the Greater Providence Chamber of Commerce legislative luncheon. Bally’s was the “presenting sponsor” of the event, which brought 50 state lawmakers, including the top House and Senate leaders, to the Rhode Island Convention Center.
Bally’s said proposed legislation would allow the state Division of Lotteries to authorize online slots and table games by the two casinos in Rhode Island, and the state would receive a percentage of that revenue. Over a five-year period, online gaming could generate $210 million in state taxes, according to a study commissioned by Bally’s.
The proposal drew immediate praise from Senate President Dominick J. Ruggerio, a North Providence Democrat who said he not only considers it a “great idea” — he said he suggested the concept to Bally’s.
“It was my idea. I went to them,” Ruggerio said after the event. “I was at a gaming conference a few years ago, and someone mentioned iGaming.”
He said he wasn’t familiar with the concept at the time. “I mean, I wouldn’t know iGaming from Adam,” Ruggerio said. “I don’t iGame.”
But he said he looked into it and learned that some other states do allow iGaming.
“I was interested because I felt that it was a revenue generator,” Ruggerio said. “It’s going to be convenient for people. They don’t have to go up there. They can stay at home.“
He said he asked Bally’s to take a look at the concept and see what they are doing in other states.
But the proposal drew opposition from Joseph S. Larisa Jr., a lawyer who had challenged the state’s online sports betting program. He noted the state Constitution says that “no act expanding the types or locations of gambling” shall take effect until such an expansion is approved in statewide and local referenda.
“As far as I’m concerned, if this passes, then Article 6, Section 22 will be read out of the Constitution,” Larisa said. “It will no longer exist.”
For this proposal to be legal, voters would have to approve the expansion in a statewide referendum, and voters in the 37 cities and towns other than Lincoln and Tiverton would have to approve it because it would expand online gaming to every smart phone, tablet, and computer screen in the state, he argued.
Larisa said the lawsuit challenging sports betting raised the same issue, and the state Supreme Court was poised to hear arguments and rule, but then the plaintiff, former Republican Providence mayoral candidate Dr. Daniel Harrop, died.
“We predicted this,” Larisa said. The Twin River website already offers free online gaming, he said, but it evades the approval requirements because no money is exchanged. “It’s already out there,” he said. “With legislative approval, it would take just a little software change to go from non-pay to a virtual casino.”
Bally’s unveiled the proposal as part of a video that Eaton showed at the outset of Wednesday’s event.
“Consistent with our goal of continuing to provide new and exciting entertainment and gaming offerings, we are excited at the prospect of supporting online casino gaming — or iGaming — in Rhode Island,” Bally’s said in the video. “We are already offering iGaming responsibly in the heavily regulated jurisdiction of New Jersey, and are very familiar with how it will enhance state revenue and better position our state and casinos long-term in the competitive New England market.”
Bally’s said it had commissioned an “independent study” that found iGaming would generate $210 million in revenue over five years. And it said the proposal would have an “immaterial effect” on the two Rhode Island casinos — Bally’s Twin River Lincoln and Bally’s Tiverton Casino & Hotel.
“Today we are announcing a major legislative initiative for the 2023 General Assembly session,” Eaton told the audience. “It is our hope that we can take part in robust conversation about online casino gaming, more commonly referred to as iGaming.”
Eaton said the proposed legislation will be modeled after online sports betting in Rhode Island, which began in September 2019. He said the legislation would ensure “that the state has complete control while at the same time maximizing revenue to the state.”
Bally’s views iGaming as “a vital step to secure competitive advantage and ensure critical revenue to the state, despite area competition which is growing to our north and to our southwest in Connecticut,” Eaton said. “We can’t sit still, and we need to meet our customers where they are.”
House Speaker K. Joseph Shekarchi, a Warwick Democrat, said he knew the concept of online casino gaming was being considered, but he said, “This was breaking news for me today.”
“I don’t do online gaming. I’m not a fantasy player. I’m not familiar with how it works,” Shekarchi said. “But I will say I like the revenue projections.”
Shekarchi said the House Finance Committee and the rest the General Assembly will let Bally’s make their case. “We will do a deep dive,” he said. “It will be a very transparent, open process.”
Bally’s spokesperson Patti Doyle said online casino gaming is now allowed in six states: Connecticut, New Jersey, Delaware, Pennsylvania, West Virginia, and Michigan.
The study, which was conducted by Spectrum Gaming and commissioned by Bally’s, concluded that Rhode Island could generate an estimated $93.3 million of gross gaming revenue in the first year, and an estimated $130.6 million in the fifth year.
That could generate $210 million in taxes for the state over a five-year period, the study concluded. That assumes “higher than industry average tax rates” of 51 percent on slots and 18 percent on table games, and it assumes that 68.7 percent of iGaming would be from slots, 28.8 percent from table games, and 0.5 percent from poker.
The online slot and table gaming wagers would be accepted only from players who are confirmed to be physically present in the state of Rhode Island at the time of their bet.
“We would use geofencing, so if you are in Boston, you couldn’t bet,” Doyle said. “You must be within Rhode Island borders.”
The server-based gaming system used to process wagers would be located in a restricted area of the casinos.
The state would retain the authority to set terms and conditions for online slots and table gaming, including all procedures for responsible gaming, system integrity, security, operations, and accounting. The effective date of the legislation would be Jan. 1, 2024.
This story has been updated with comments from Joseph Larisa Jr.