By Katherine Gregg

PROVIDENCE, R.I. -- A campaign spokesman for Attorney General Patrick C. Lynch is slamming his primary opponent in the race for governor for alleged flip-flops on the proposed Twin River "bailout,'' without saying where Lynch himself stands.

"It sounds like Frank Caprio was for a taxpayer funded bailout before he was against it. Is he really against a bailout or is this just Frank Caprio playing politics, the 3rd largest source of state revenue,'' new Lynch campaign manager Joel Coon said.

The response from the Caprio camp: "Mr. Coon, as an out-of-state political operative, may not be familiar with this issue and the difference between financial terms like 'buy out' and 'bail out.'

"The 'buy out' Caprio recommended, would have allowed the State to acquire at the market low in 2008, and at a profit accruing to the benefit of the taxpayer, the real estate at Twin River that houses the State's lottery machines,'' spokesman Nick Hemond said. "The 'bail out' Caprio is opposing, would require the taxpayers to foot the bill for concessions by the State that would increase the value of the real estate to the benefit of the big banks.''

Coon keyed his comments to remarks Caprio, the state treasurer, made before and after a State House hearing Tuesday night on a concession package Governor Carcieri is promoting on behalf of the big-name lenders about to take ownership of the bankrupt Lincoln track-and-slot parlor.

Carcieri's proposal would end dog racing, waive for now and then cut in half the 1,300 minimum job requirement at the sprawling Lincoln gambling hall, commit the state to paying Twin River up to $5.036 million in new management and marketing fees, and shore up the lender/owners' right to sue the state if Twin River lost money to a new Rhode Island competitor.

Urging the lawmakers to say no to a 'bailout of the big banks,'' Caprio suggested options, do nothing to enhance the value of Twin River at taxpayers' expense, and force the lenders back to the negotiating table or ask the U.S. Bankruptcy Court to auction the state's largest slot parlor to an experienced gambling operator.

Twin River is home to about 4,750 electronic video-slots, roulette and blackjack games placed there by the state Lottery, under terms where the state gets to keep about 61 cents out of every dollar a player loses. The owners get their own 27.8 percent share of the state's video-slot revenue.

At an earlier point, when Twin River's owners were still struggling financially, but not yet in bankruptcy, Caprio suggested the state float bonds to buy Twin River, and then sell it at a presumed profit when the market improved, keeping the owners' share of the video-slot revenue for itself in the interim.

Coon said: "Caprio's plan last year to help pull Twin River out of bankruptcy with state bonds to prevent bankruptcy, thereby securing the lenders' investment, was nothing short of a taxpayer-backed bail out for the lenders, aka 'the big banks.'

"His position now of 'doing nothing' is, at best, a clear reversal of his previous approach to the issue.''

In response, the Caprio camp questioned "if Attorney General Lynch, as the State's top law enforcement official, will be taking a position or offering any solutions protecting RI taxpayers from the big bank bail out proposed at Twin River?''

Asked where Lynch stood, Coon instead hammered Caprio for "risking'' jobs and $250 million-plus in state revenue "to score political points over what is a modest investment compared to the return.''

"This revenue stream will only dramatically increase should the voters get the opportunity they deserve, which is to vote on the expansion of gaming in the state this fall,'' Coon said.

But Coon did not respond to further questions about where Lynch stands on the other elements of the proposal, including the reduced jobs guarantee and "slippage clause'' insulating the slot parlor against losses to a competitor.

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