Projo 7 to 7 News Blog

The gambling hall, with 12 greyhound kennels, an estimated 1,200 dogs and 4,752 video slots, is owned by a subsidiary of BLB Investors, which bought the Lincoln Park dog track in 2005, and then embarked on a $225-million renovation and expansion.

What happens at Twin River is of enormous financial significance to the state, which until recently was banking on $246.8 million this year alone from the 4,752 electronic slot and virtual blackjack machines placed there by the Rhode Island-based GTECH and other companies under contract with the state Lottery Commission. While the amount has dropped slightly, slot revenue remains the third largest source of state revenue.

Since March 2008, however, when they first defaulted on their loan payments, Twin River's owners have been struggling to keep their lenders and contractors at bay while avoiding bankruptcy court and plug an estimated $30 million hole in their operating budget.

Over the adamant objections of the dog-owners and their supporters within the General Assembly, Twin River announced plans to suspend dog-racing in August, after running the minimum 125 days of racing required to keep their video-slot license.

State lawmakers, at the owners' request, freed Newport Grand in 2003 from having to offer Jai Alai to operate its own video-slots. And in response to inquiries in fall 2008, Governor Carcieri said he did not care whether the Lincoln gambling hall continued to have dog racing, an expensive holdover that cost the current owners of Twin River close to $9 million in annual subsidies, while generating a total of $966,211 for the state in 2008.

On Wednesday, the owners made public for the first time their July 18, 2005 contract with the dog owners. The term of the contract coincides with Twin River's revenue-contact with the state which, with potential renewals, would run until 2020.

Among the key features: a commitment to pay the greyhound owners' association a racing subsidy of between $9 million and $10 million annually, on top of the dog owners' share of the live and simulcast racing handle. In all, the payments to the dog owners totaled $11.3 million in 2006, $11.1 million in 2007, and $10.7 million in 2008.

They also released a profit and loss analysis that shows them banking $1.8 million from dog racing in 2008, while spending $2.6 million to run the dog racing end of the operation, and paying the "contract fee'' of $9.7 million. That resulted in a net loss of $10.5 million last year, by their calculations.

There are only a handful of other places the owners can turn to plug the rest of their revenue hole, without reducing the state's share of the video-slot revenue.

The state currently keeps close to 60 cents of every dollar left behind by losing players, after the winners have been paid. It then gives the Twin Rivers owners 27.8 percent of the money left behind in each of the machines, an estimated $107.6 million this year.

The machine providers are guaranteed 7 percent of the net income from each machine. Estimated annual payments to the machine providers this year are: GTECH, $15.5 million, IGT, $12.4 million, and Williams, $3.5 million.

The town of Lincoln gets $5.577 million, and the Narragansett Indian Tribe, $662,901.

There was no immediate response from Gary Sasse, director of the state Department of Administration, to Doyle's statement that the owners have made "significant progress'' in recent weeks in their talks with the state and their lenders on a resolution that would keep them out of bankruptcy court.

Late Wednesday afternoon, the greyhound owners issued this statement:

"We have been a strong partner and asset to Twin River for the past four years and have worked hand-in-hand with them to make Twin River successful both for BLB Investors and the state of Rhode Island." said Richard Brindle, RIGOA president.

He continued, "This offer would essentially eliminate greyhound racing in Rhode Island, eliminate 225 jobs and potentially cause Twin River to lose as many as 5,000 customers per week who come into the facility to enjoy a menu of attractions. These loses would result in reduced tax revenue and fees to the state.

"We are not looking for a buyout, but to protect jobs. It is our priority to ensure greyhound racing continues at Twin River and that 225 employees are not forced onto the state's already packed unemployment rolls," he concluded.

The original version of this story was posted at 4:09 p.m.