PROVIDENCE, R.I. — After state leaders struck a deal with Rhode Island’s top gaming companies to share new gambling profits, House lawmakers Friday approved a $9.6-billion state budget for the year starting July 1 that would legalize sports betting.

The proposed budget now moves to the Senate for an expected vote next week.

The budget, approved 66-7, would increase total spending next year by $316 million, or 3.4 percent, from the budget lawmakers passed last year. It also includes a $222-million midyear increase to the 2017-2018 budget, made possible by a surge in tax collections.

Included in the new spending are $46 million in election-year raises for state workers, $5.9 million to settle a lawsuit by nursing homes, $6 million for the second year of free tuition at the Community College of Rhode Island and $54.7 million for cities and towns to cut their local car taxes for the second year in a row.

Lawmakers also sent $250 million in proposed borrowing for school construction to voters for their approval on the November ballot. And they voted to expand the state’s film and TV tax credit incentive program.

“I expect the budget to rise every year,” said House Speaker Nicholas Mattiello after the final vote, a few minutes before 10 p.m., in response to Republican complaints about overspending. “To not expect it to rise every year is not realistic.”

Helping pay for those expenditures is $23.5 million in the proposed budget from sports betting at Twin River Casino in Lincoln and a soon-to-open casino in Tiverton.
After days of negotiations, representatives of the House, Senate, Gov. Gina Raimondo’s administration and two private companies — Twin River and IGT — reached an agreement on how sports wagering would work Friday and quickly inserted it into a budget amendment.

The deal would give the state 51 percent of all new sports betting revenue and, under a five-year contract to set odds and manage bets, Providence-based IGT would get 32 percent. As host of the new betting parlors, Twin River would get a 17-percent cut of revenue.

The sports gambling section of the budget passed with no discussion, 64 to 7, minutes after the new language was unveiled.

Before the U.S. Supreme Court cleared states to legalize sports betting, Raimondo’s budget in January estimated the same $23.5 million in state revenue from sports betting while assuming 61 percent of gambling profits.

Explaining how the state will make up that revenue with a lower share, House Majority Leader K. Joseph Shekarchi said the amendment opens up betting to international events. And, he said, Rhode Island expects to start allowing betting before Massachusetts and Connecticut, drawing extra customers from those states.

“I think it is a very good deal,” Mattiello said on the agreement with IGT. “We are in sports gaming earlier than other states and we have a better percentage for the taxpayers than any state that’s doing it right now.”

The budget also books $4 million from allowing Twin River to run “stadium gaming” in which bettors watch live dealers on giant video screens.

Before the focus turned to gambling, Republicans offered a series of amendments — to no avail — on causes they’ve been fighting for much of the year.

Among them, a bid by Warwick Rep. Robert Lancia — who is contemplating a run for lieutenant governor — to end the use of E-911 telephone fees for general government operations. In 2017, the charges on Rhode Island phone bills raised $16.8 million, of which $5.2 million went to E-911.

While 69 percent of the fees are diverted on average each year, he said, Rhode Island seriously lags other states in training and technology.

For example, he said, “Rhode Island is the only state in New England where 911-telecommunicators are not trained to coach callers through CPR. And the survival rate for a sudden cardiac event outside of a hospital in Rhode Island is only 10 percent, versus 50 to 60 percent in states with CPR-trained telecommunications. This [was] one of the points the Rhode Island Medical Society made.”

The budget adds $1 million to next year’s E-911 budget, reaching nearly $7 million, and removes E-911 from the name of the charge on bills.

“Yes, there is truth in advertising, but that has been dealt with,” said Rep. Christopher Blazejewski, D-Providence, defending the state’s use of E-911 fees. “Approving this amendment blasts a multi-million-dollar hole in budget.”

Lancia’s amendment was defeated, 59 to 13, with three Democrats voting for it. That was the closest any GOP amendment came to passage.

House Minority Leader Patricia Morgan, a candidate for governor, introduced amendments to scoop $23 million in school security improvements from the attorney general’s office, and to end prevailing wage rules for school construction projects.

“What happens to Rhode Island when the next recession comes and we have done nothing in this budget to change the structural deficiencies?” Morgan asked before the final vote.

The biggest surprise of the night was an amendment from House leadership to sweeten the state’s controversial film tax credit incentive program.

The change would allow film and TV productions to get a credit worth 30 percent of their production costs, instead of the current 25 percent. It would also increase the maximum incentive a production could receive from $5 million to $7 million and exclude reality TV shows from the incentive.

House aides said the change would not cost anything in fiscal 2018-2019, and they could not provide an estimate for years after that.

“Just trying to be competitive with other states,” Mattiello said about the reasoning for the film credit change. “There are a lot of irons in the fire — nothing definite — we are trying to be competitive.”

The budget did not expand the number of medical marijuana dispensaries — from three to 15 — as Raimondo had proposed.

— panderson@providencejournal.com

(401) 277-7384

On Twitter: @PatrickAnderso_

— kgregg@providencejournal.com

(401) 277-7078

On Twitter: @kathyprojo

This article is a reprint from ProvidenceJournal.com. To view the original story and comment, click here.