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Earlier this month, Gov. Lincoln Chafee expressed the fear that trying to cull too much revenue from the state's slot parlors could send gamblers to other states, where the odds might be better.
"They are not going to play if they are going to keep losing," Chafee said. "They'll go across the border, or go somewhere else where the odds, if you will, are more in their favor. … They know where they have a better chance of winning."
In response, Patti Doyle, spokeswoman for Twin River, one of Rhode Island’s two slot parlors, said in a radio interview that her casino gives better odds.
"We know from the industry standards in the industry casino world, that we're all pretty much on the same level. You know, you wouldn't be able to continue to be in business if you weren't competitive with gaming venues that are nearby. And we are. We're more than competitive," she said on radio station WPRO (630-AM).
When we hear "more than competitive," we think "better."
So we asked Doyle for the source of that comparison. While we awaited her response, we started our own research.
On its website, RILot.com, the Rhode Island Lottery publishes a monthly list of how much cash was put into Twin River’s 4,700 slot machines, how much cash was won, and how much that represents in percentage.
(It should be noted that neither Twin River, nor Newport Grand, the state’s other slot parlor, sets the payout percentages of their slot machines. They’re set by the director of the Rhode Island Lottery, Gerald S. Aubin.)
Statistics for Connecticut's two casinos -- Foxwoods Resort Casino and Mohegan Sun -- are on the website of the Connecticut Division of Special Revenue at CT.gov/DOSR.
At first glance, it looks like Rhode Island is less than competitive. During the period from January 2010 through January 2011, the highest monthly Twin River payout to gamblers was 91.529 percent, in December. The highest payout percentage at the Newport Grand, was lower: 91.171 percent in September.
In contrast, the payouts at Foxwoods are listed as higher for 11 of the last 12 months. And Mohegan Sun offered a bigger payout every month, going no lower than 91.80 percent last May and as high as 92.17 in August.
But George Papanier, CEO of Twin River, said the published percentages aren't comparable because states calculate the payout percentage differently.
The issue is the credits that players get, also known as "free play." Rhode Island calls it Bonus Play. Mohegan lists it as eBonus Credits. In the Foxwoods report it's called Free Play. The two states account for it differently, said Papanier. Officials at the Rhode Island Lottery told us the same thing.
As a result, the payout percentage for Foxwoods and Mohegan Sun is inflated, they said.
In order to calculate the "Cash Won" at each Connecticut casino the same way it is calculated in Rhode Island, you must take the "handle " (the amount played, including free play and winnings replayed), subtract the "Win" amount (how much the casino wins) and subtract the value of the Free Play or eBonus coupons redeemed at the slot machines.
By that formula, we discovered that, as Doyle said, Twin River’s payout percentage is better than Foxwoods’. In every month over the past year, Twin River had a higher payout percentage. The one-year averages: 91.366 percent for Twin River and 90.768 percent for Foxwoods.
The story is a little different for Mohegan Sun. It beat out Twin River in 7 of the past 12 months, but the Connecticut casino's 12-month average was a hair below Twin River's, at 91.359 percent.
A few tenths -- or hundredths -- of a percent may not seem consequential, but to serious gamblers, any tilt in their advantage is attractive, maybe even enough to send them to one casino over another.
To double-check our numbers, we talked to Michael Janusko, chief financial examiner of Connecticut's Division of Special Revenue, who confirmed that our calculations were correct. The way Foxwoods and Mohegan Sun run their numbers, "it does overstate the payout percentage a bit," he said.
Finally, Doyle sent us a copy of The Gaming Industry Observer's East Coast Slot Report that summarizes casino operations from Maine to Florida in January. Twin River ranked 13th out of 56 facilities in terms of money paid out to players, ahead of Mohegan Sun (25th), Newport Grand (26th), and Foxwoods (35th).
Aubin, Rhode Island's Lottery director, said there is an important caveat to understand when considering payout. Those percentages are largely a function of the types of machines a casino has, not whether it is actually giving gamblers better odds.
All other things being equal, a facility that has lots of penny slots, for example, will have a lower overall payout percentage than a casino that has none because those machines have smaller payouts.
"I'm confident it would be the exact same payout throughout the country with the same game," he said.
To summarize: Looking at the casinos as a whole, the way Foxwoods and Mohegan Sun calculate their payout percentages may make them look like a better bet for gamblers. But if you include player rewards to make an apples-to-apples comparison, Doyle's statement that Twin River is "more than competitive" is true for Foxwoods. Whether it applies to Mohegan Sun depends on the month.
We rate her statement Mostly True.
630WPRO.com, "Twin River Spokeswoman refute's Governor's claims that prize payout is less because of % they pay to the state," March 2, 2011, accessed March 2, 2011
RILot.com, "Video Lottery Payouts by Facility," accessed March 3, 2011
CT.gov/DOSR, "Foxwoods Casino, Schedule of Selected Video Facsimile/Slot Machine Data For the Period January 1, 1993 Through Jan 31, 2011," accessed March 3, 2011
CT.gov/DOSR, "Mohegan Sun Casino, Schedule of Selected Video Facsimile/Slot Machine Data For the Period October 1, 1996 Through Jan 31, 2011," accessed March 3, 2011
Interviews and e-mails, Patti Doyle, spokeswoman, Twin River, March 2, 3, 7, 2011
Interviews, George Papanier, CEO, Twin River, March 3 and 7, 2011
E-mail and interview, Peg Rose, deputy director, Rhode Island Lottery, March 4, 2011
Interviews, Gerald S. Aubin, executive director, Rhode Island Lottery, March 4 and 7, 2011
Interview, Michael Janusko, chief financial examiner, Connecticut Division of Special Revenue, March 8, 2011
Providence Journal, "Governor backtracks on casino," , March 2, 2011
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