Rhode Island Casino to Impact Massachusetts

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Monday, November 28th, 2016 | Written by Charles Washington

Rhode Island considers gambling to be an important part of its economy, with the industry ranked the third largest in the whole state. For years, the USA’s third smallest state has been able to draw visitors from its neighbor Massachusetts, but since the Bay State started issuing licenses for slot parlors and casinos, Rhode Island has had to face an increasing level of competition. Now, the state’s residents have voted to readdress the situation by voting in favor of a casino expansion close to the Massachusetts border.

Positive Referendum

On Election Day, Rhode Island voters approved a referendum to license a casino in Tiverton, a town that is situated just a few hundred yards from the Rhode Island-Massachusetts border. Twin River is the company that will benefit from the new approval, with the operator already running an eponymous casino in Lincoln, and one called the Newport Grand in Newport.

However, now that their new casino has been approved, the Newport Grand casino will close in order to better accommodate Massachusetts travelers, who make up a big segment of the gamblers who currently visit the Newport Grand.

$75m Tiverton Casino

The proposed casino that Rhode Island voters approved will cost $75 million to build, and once completed will include 84 hotel rooms, 1000 slot machines, and 32 gaming tables on the casino floor. The design of the resort is inspired by Tiverton’s historic library, and is intended to appeal to regional travelers rather than being an international upmarket destination.

According to Twin River chairman, John Taylor, around 300 temporary construction jobs will be created by the project, with 550 permanent jobs set up once the development is finished. Taylor has further emphasized the importance that the new casino will have in generating extra tax revenues of around $20 million for Rhode Island, as well as counteracting the impact of the casino expansion drive currently underway in Massachusetts. As he explains:

“Today Twin River generates about $27 million in revenue to the state of Rhode Island. With this proposal it would generate $50 million, but also as much as $70 million depending on competition.”

Likely Impact on Massachusetts

With the Tiverton casino now green lighted, many analysts are wondering what impact the new casino will have on the gambling industry in Massachusetts. After all, border wars have been raging between the two states ever since Massachusetts legalized casino gambling in 2011, prompting Rhode Island, after seeing its slot business decline by 6 percent, to allow table games at Twin River the following year.

These days, the closest competitor to Twin River is Plainridge Park in Massachusetts, a slots-only operation which opened for business in 2015. Revenues have subsequently come in below expectations at Plainridge, with the casino blaming table games at Twin River for part of its woes.

Currently, there are three major casino projects underway in Massachusetts, two of which boast multi-billion dollar budgets and will be more like Las Vegas casinos. These full-scale luxury resorts includes the MGM Resorts in Springfield, and Wynn Resorts near Boston Harbor. Once completed, both casinos will be more like Las Vegas casinos. Due to the style, size and location of the MGM and Wynn developments, the Tiverton Casino in Rhode Island is not likely to be much of a competitor. The casinos are catering to different markets and are located far enough apart to not impact one another’s business. That doesn’t mean that the expansion of gambling in Rhode Island won’t affect Massachusetts, though.

Tribal Casino Concerns

The new Tiverton casino will be very close to a new project that is underway on tribal land in Taunton. Owned by the Mashpee Wampanoag tribe, this casino has a budget of $1 billion, but its construction has stalled because the tribe is currently caught up in a lawsuit. Casino experts in New England now think that the tribe will likely use this to their advantage. With building delayed, the Mashpee Wampanoag can watch the progress unfold and decide whether to scale back their project in light of the competition or invest even more to create a flashier property that might better compete with the new Tiverton Casino.