Rhode Island Bill Would Double Casino Credit For Gamblers

In a move that has quickly ignited a flurry of debate, Rhode Island’s Senate President Dominick Ruggerio has thrown his support behind a bill that seeks to significantly increase the gambling-on-credit limit at the state’s two casinos operated by Bally’s Corporation.

The proposed legislation aims to double the current credit limit from $50,000 to $100,000. It’s a change that proponents of the legislation, including Bally’s, argue is necessary to maintain the competitiveness of Rhode Island’s gaming facilities, the Twin River Lincoln and the Tiverton.

Introduced on May 2, the bill has been fast-tracked through the legislative process, raising questions about the urgency and the potential implications of such a significant increase in the credit limit. The Providence Journal reports that the move comes as Rhode Island’s casinos face stiff competition from neighboring states, with Massachusetts having no such credit limits and Connecticut’s tribal-run casinos setting their own credit policies.

The bill also proposes some changes to the 20-year agreement for Rhode Island’s lottery and casino operations. These changes would impact how Bally’s calculates its financial health and how it rewards customers.

First, the bill would allow negotiations between the Rhode Island Lottery and Bally’s on how Bally’s debt is measured. This could take into account money Bally’s invests in building new facilities, not just when it buys other companies.

Second, the bill would modify the way Bally’s calculates points awarded to customers in promotions. These points are essentially discounts offered by Bally’s to attract more customers, and the cost comes out of the state’s share of the profits.

Bally’s wants more freedom

The discussions have also touched upon the broader implications for the state’s regulatory framework. The bill proposes to grant the Department of Business Regulation the authority to alter the terms of the state’s operating agreement with Bally’s without seeking legislative approval.

This provision has led to unease among some lawmakers and others opposed to the legislation. They worry about the lack of legislative oversight and the precedent it may set for future regulatory changes.

The debate extends beyond the credit limit itself, delving into the financial health and oversight of the casinos. With Rhode Island relying heavily on gambling tax revenue — anticipated to be $428.8 million this year — the stakes are high.

However, the bill’s proponents have assured that the increase will have controls in place to prevent abuse. Rigorous financial checks, including credit assessments and identification verification, will mitigate the risks associated with higher credit limits.

Looking for deeper pockets

The legislation has been met with mixed reactions. Supporters, including Bally’s representatives, have emphasized the need to attract high-stakes gamblers who expect higher lines of credit, which are standard in other states. They argue that the increased limit would not only retain existing customers but also draw new patrons, thereby boosting revenue for the state’s third-largest source of income.

However, critics have expressed concerns over the potential for increased gambling addiction and financial risk for individuals. The absence of representatives from the Rhode Island Lottery and the Council on Problem Gambling during discussions has been noted, with some questioning the level of scrutiny that has been applied to the bill’s potential impact on problem gambling.

The bill’s proponents must convince both the legislature and the public that the proposed changes will not lead to an escalation in gambling-related harm. At the same time, they have to ensure that Rhode Island’s casinos remain viable and competitive in the New England market.