Letter: Business 101 Says Casino Plan is a Bad Deal for Newport

To the editor:

There has been much debate regarding the addition of table games to Newport Grand. Everything from morality to aesthetics to economics has been heatedly discussed on both sides.

So here we are, Newport. We are presented with a business deal. An investment opportunity, they say. Well, in business, when one is approached with a deal, one must clearly analyze exactly what is being brought to the table. What’s in it for Newport? What’s in it for the Developers? Would this be an equal partnership? How does the state of RI fit into this partnership? What are the risks? What is the ROI? Developers don’t prepare and present deals for fun. Of course, The City of Newport certainly has something that they need.

The developers of Newport Grand have analyzed their risk, done their numbers, understand their bottom line, calculated the ROI, consulted with lawyers, detailed their contracts, itemized their construction costs, have prepared their renderings, and have gone so far as wrap the building in advertising. And they presented Newport with our side of the deal: A host agreement that was ultimately rejected. So now, ballot votes will be cast with no city host agreement at all.

Without much analysis, this is clearly a bad business deal. Did you buy your house without a contract? Your car? Buy stock? All business transactions and partnerships have agreements negotiated between parties - except this one.

Think of this, Newport: not only are we without a contract - we have no guarantees regarding the projected revenue for this business venture. There are numerous economic forecasts presented to us. They are all assumptions and conjecture. Further, the Developers state table games are necessary because “Newport Grand has suffered financially in recent years due to a $35 million reduction in gross revenue”. The brilliant solution to the continued downturn of Newport Grand is to simply add more gambling to a current failing gambling business model. Meanwhile, other gambling facilities across our region are failing too – and table games don’t seem to be keeping them in the black.

So the bottom line is that Newport has this “investment opportunity” to become partners in a financially failing business, without any contract. And don’t forget the state of RI will be another partner in this deal, with its own stake to claim. Take a deep breath, Newport. Clear your head. See this as the truly bad investment that it is. Vote NO on Question 1.

Stephanie Szneke