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Harrah's Entertainment Spent $12 million But it Wasn't Enough as Rhode Island
 Voters Reject Giving Harrah's and Narragansett Indian Tribe Excusive
 Rights to Operate Casino

By Scott Mayerowitz, The Providence Journal, R.I.McClatchy-Tribune Business News

Nov. 8, 2006 - Harrah's Entertainment spent $12 million -- a Rhode Island campaign record -- but it still wasn't enough. Voters yesterday rejected, by a wide margin, the casino that Harrah's and the Narragansett Indian tribe had proposed for West Warwick.

About 63 percent of voters rejected amending the state Constitution to give Harrah's and the tribe exclusive rights to operate the state's only casino.

In West Warwick, the measure passed by the slimmest of margins -- just 146 votes out of more than 10,676 cast there, with a potential 464 mail ballots yet to be counted last night. Central Falls residents overwhelming approved the casino; it appeared to barely win in Providence and Pawtucket. Voters in the state's other 35 cities and towns rejected it.

The vote turned out to be less a referendum on gambling -- Rhode Island already has 4,672 slot machines -- than a rejection of the arrangement lawmakers crafted.

The anti-casino campaign from the beginning called the proposal "a bad deal for Rhode Island" and focused the debate on "rewriting" the Constitution to give a Las Vegas casino company "a no-bid deal."

Harrah's and the tribe had pushed their message of tax relief and job creation but it wasn't enough to sway voters.

"I think [the voters] spoke overwhelming and I think they've been saying this for a number of years. I just think the General Assembly hasn't been listening," said former Republican Gov. Lincoln C. Almond, who led the anti-casino effort.

Narragansett Indian tribe Chief Sachem Matthew Thomas told supporters last night that "it was a tough thing to try to amend the Constitution."

"Don't be ashamed and don't shed any tears," he told the crowd gathered in West Warwick's West Valley Inn.

Voters last considered a casino in 1994, when five separate ballot questions were rejected, including one that would have let the tribe build a casino in West Greenwich. That question was rejected by 54 percent of voters statewide.

Thomas said he will now "go back to the tribe and ask what their plan is."

"The tribe's got to decide what direction to go," he said.

Jan L. Jones, Harrah's senior vice president for communications and government relations, said the casino company will not seek another referendum.

"Voters have decided," Jones said. "There's no reason to do it again this way."

However, Jones last night talked about the possibility of lobbying Congress to change a federal law -- the so-called Chafee amendment -- restricting the tribe's gambling rights.

Maureen Moakley, chairwoman of the political science department at the University of Rhode Island, predicted that if Massachusetts allows slot machines there, Rhode Island will quickly approve a casino.

"There will be a complete turnaround," she said. "All of these issues [raised by opponents] will go away."

For the most part, Rhode Islanders were split on the issue along class and racial lines.

The more affluent and white communities flat out rejected the casino while poor and minority areas supported it.

"It's a class war," Thomas said yesterday.

At the private Moses Brown School on Providence's East Side, Ben Rotenberg voted against the casino saying afterward, "I just don't see any upside to it."

"I don't believe it will help the state," he added. "It's good for the Harrah's casino company and bad for everybody else."

Across the city at the West End Community Center, Zemoria Mitchell and her family said they cast ballots for the casino.

"The taxes are ridiculously high," she said, adding that she hoped to get some tax relief from the casino.

Mitchell said the state needs more jobs and that the politicians against the casino already have plenty of money.

"What about me?" Mitchell asked. "What about my family?"

The opposition was bankrolled almost entirely by those who had the most to lose: the state's two existing gambling halls, Lincoln Park and Newport Grand. Joining in the Save Our State coalition were restaurants, performing arts venues and a number of groups including The Rhode Island Hospitality and Tourism Association, the Greater Providence Chamber of Commerce and the Rhode Island Public Expenditure Council, a business-backed research group.

Harrah's paid entirely for its own campaign and had the support of many of the state's unions, particularly those in construction, and several minority community groups.

Save Our State spent about $3 million fighting the casino while Harrah's spent $12 million in its push -- about $90 a vote.

Harrah's had a large mobilization effort, transporting voters to the polls in a fleet of vans and buses and even setting up a toll-free phone number for people looking for a ride.

Save Our State never had the same machinery, got off to a late start and briefly lost direction after its chairman, former Cookson America chief executive officer Richard Oster, resigned over a difference in philosophies. Oster was replaced with former Republican Gov. Lincoln C. Almond.

Moakley, however, said the group ran a "brilliant" campaign.

"They didn't focus on the real issues: gambling, no gambling. Jobs, no jobs," Moakley said.

Instead, she said, Save Our State shifted the debate to the type of arrangement Harrah's would have. Moakley said Harrah's didn't properly anticipate these arguments or do a good job of pointing out, for instance, that Lincoln Park got a no-bid deal to add slot machines and that the track is owned by out-of-state interests.

"It's an example that there's an established business and political elite with enormous influence," Moakley said. "When they all get on the same page, they can pretty much run the show."

Thomas acknowledged that amending the Constitution made the casino a harder sell. He also said that while people trust his tribe, there was some hesitation because of Harrah's, but said it was nothing in particular about the company.

"Whoever we brought in here would have been painted as the devil."

Rep. Nicholas Gorham, R-Coventry, a casino opponent, had a more blunt assessment.

"People just didn't trust the General Assembly to do the right thing," Gorham said. "If you give someone a constitutional right to something, you're putting the General Assembly in an awfully difficult bargaining position."

With reports from staff writer Arthur Kimball-Stanley


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