Rhode Island Republican Party Lobs Ethics Complaint at Raimondo Over Her Support of IGT

Posted on: July 25, 2019, 09:14h. 

Last updated on: July 25, 2019, 09:33h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Gov. Gina Raimondo’s (D-RI) support of International Game Technology Plc (NYSE:IGT) is drawing fresh criticism as the state’s Republican party is complaining to the R.I. Ethics Commission that the governor’s relationship with the gaming machine manufacturer raises conflict of interest concerns.

Rhode Island Gov. Gina Raimondo faces more controversy over a proposed $1 billion contract with IGT. (Image: AP)

An ethics complaint filed Wednesday by the Rhode Island Republican Party against Raimondo is the latest chapter in what has become an increasingly controversial effort the by the governor to allow IGT to maintain a dominant position in the Ocean State’s gaming device market.

Governor Gina Raimondo appears to have violated R.I.G.L§§ 36-14-5(d), and 36-14-5(h) by having the State of Rhode Island enter into a tentative agreement with International Global Solutions Corporation, a subsidiary of International Game Technology PLC (“IGT”)to extend its existing contract and agreements with the State of Rhode Island until 2043,” according to a copy of the GOP complaint obtained by Casino.org.

Critics allege that Raimondo is looking to award a 20-year, $1 billion agreement to IGT to run the state’s gaming machines without putting that contract up for bid.

Earlier this month, Twin River Worldwide Holdings, Inc. (NYSE: TRWH), the owner of two casinos in Rhode Island, overtly said that deal is anti-competitive and is bad news for the state’s tax payers. TRWH also claims that Raimondo’s pact with IGT would allow the device maker to control up to 85 percent of Rhode Island’s gaming machines, but state law allows for a single company to have just 50 percent market share for betting devices.

More Controversy

Last week, Raimondo dismissed a $125 million proposal by Twin River to run the Rhode Island’s lottery instead of IGT, questioning TRWH’s lack of lottery experience while chastising the firm’s status as a publicly traded company. IGT is also a public company.

Raimondo’s dealings with IGT have also prompted criticism from some Democrats with Rhode Island House Speaker Nicholas Mattiello saying there has been a secretive element to the governor’s negotiations with the gaming machine company.

The state Republican Party also levied allegations against the governor regarding her handling of online sports betting contracts.

“In addition, Governor Gina Raimondo appears to have violated R.I.G.L §§ 36-14-5(d), and 36-14-5(h) by signing legislation, which allowed online sports gambling in Rhode Island and then having the R.I. Lottery avoid the RFP process to select a vendor to manage online sports betting anywhere in Rhode Island by agreeing that IGT, the current provider of in-person sports betting, would handle all online sports betting,” according to the GOP complaint.

Too Close For Comfort

Ocean State Republicans are also concerned about the relationship between Raimondo and IGT lobbyist Donald Sweitzer. Formerly IGT’s chairman, Sweitzer also currently works for the Democratic Governors Association, of which Raimondo is the leader.

The state GOP claims that Sweitzer likely owns more than $5,000 worth of IGT stock, meaning the governor cannot award the company a contract unless there is a competitive bidding process.

If it wins the agreement, IGT would garner about $50 million annually from the Twin River in Lincoln and Tiverton, TRWH’s Rhode Island casinos. TRWH argues that IGT’s machines are out-of-date and produce lower yields than devices made by rival manufacturers.

The brewing IGT controversy comes at a time of dismal approval ratings for Raimondo. A recent survey by Morning Consult puts the Rhode Island governor’s disapproval rating at 55 percent and her approval mark at 38 percent. Just two governors have lower satisfaction percentages than Raimondo.