The front entrance to Bally’s Tiverton casino. (Christopher Shea/Rhode Island Current)
During a virtual annual meeting that lasted approximately 10 minutes, Bally’s Corporation shareholders Thursday rejected a proposal that could have led Rhode Island’s sole casino operator to eventually ban indoor smoking.
The full results won’t be known until Bally’s submits a regulatory filing in the next few days. If at least 5% of shareholders supported the proposal compelling the board of directors to commission a report on the potential cost savings of adopting a smoke-free policy for Bally’s Corporation properties, it is eligible to be presented again in 2025, said Cathy Rowan, director of socially responsible investments at Trinity Health.
The Michigan-based nonprofit health care organization, which owns 440 shares of Bally’s stock — or 0.001% of Bally’s 40 million shares — proposed the study in collaboration with the American Nonsmokers’ Rights Foundation, based in Berkeley, California.
“There are potential business risks to allowing indoor smoking in Bally’s properties,” Rowan told shareholders Thursday.
Those risks, she said, include higher health insurance premiums, higher maintenance cost, and deterring visitors who don’t want to deal with the smoke.
Rowan also said investor expectations have increased for improved performance and disclosure on the company’s workplace health and safety practices.
“We shareholders have no guidance as to the cost Bally’s is bearing for continuing to allow indoor smoking,” Rowan added. “Nor has the company disclosed social or environmental costs and risks imposed on its stakeholders.”
Rhode Island banned indoor smoking in public places and workplaces in 2005, but casinos were exempt from the law. Advocates and lawmakers have attempted to change the state’s rules, but legislation has never made it out of committee.
R.I. treasurer backs shareholder proposal for Bally’s to explore going smoke-free
Trinity’s activist shareholder proposal marks the first time such a change has been attempted at the investor level instead of through the Legislature.
Bally’s owns and manages 15 casinos across 10 states, a New York golf course, and a Colorado horse racetrack. The Providence-based casino giant’s eight-member board of directors unanimously recommended voting against the proposal, calling it “unwarranted and unreasonable.”
All Bally’s directors and executive officers as a group own a combined 28.9% of shares.
Among those voting in favor of the proposal was Matt Dunham, president of Providence-based Table Game Dealers Laborers Local 711. He said the vote by Bally’s shareholders was disappointing, but expected.
“The foundation that started the whole thing only had 440 shares — there’s 40 million outstanding,” said Dunham, who owns 1,500 shares. “I know the chairman probably 13 million, that’s a lot on the disapproving side.”
Just because this shareholder battle was lost, doesn’t mean the union’s push to end smoking at the Lincoln and Tiverton casinos is over. Dunham said union leadership is closely monitoring a lawsuit filed by workers in Atlantic City to end smoking in New Jersey’s casinos.
“We’ll be right on the heels of that if that has any glimmer that it might work,” he said. “We’re going to keep on fighting this — it’s something everybody knows should be gone. ”
Plus there’s always a chance Bally’s shareholders can vote on this proposal again, though it’s unclear if more union members will participate. Dunham said he won’t be the one to push people toward the company stock.
“I personally wouldn’t recommend it to people just to avoid giving financial advice which I am not licensed to do,” he said.
As of the close of trading Thursday, one share of Bally’s stock cost $13.01, down from $15.46 a year ago. The 52-week range was $7.28 to $16.96.
The proxy vendor for Rhode Island General Treasurer James Diossa also voted in favor of Trinity Health’s proposal. Rhode Island’s pension system owns 990 shares of Bally’s stock worth roughly $11,000. The state has owned Bally’s stock since September 2021. That amounts to 0.002% of Bally’s shares.
The rejection from Bally’s investors comes one week after a similar proposal was voted down by 78% of Las Vegas-based Boyd Gaming shareholders. Trinity’s measure is also on the docket for Caesars Entertainment’s annual shareholder meeting scheduled for June 11 in Reno, Nevada. Caesars’ 10-member board of directors opposes the proposal.
Rhode Island’s pension system owns 7,056 shares of Caesars Entertainment Stock worth nearly $252,750. A spokesperson for the Diossa’s office did not respond to an inquiry over if the state also plans to vote for Trinity’s proposal in June.
What was approved
Polls were open for five minutes of the shareholders meeting. Shareholders approved thereappointmentTerrence Downey, Jaymin B. Patel, and Wanda Young Wilson to three-year terms on Bally’s board of directors.
Shareholders also agreed to select London-based Deloitte and Touche, LLC as Bally’s public accounting firm and compensation for Bally’s named executive officers. Bally’s proxy statement published April 5 notes the firm has been used by the company since 2015.
Last year, Bally’s paid roughly $9.8 million for services provided by Deloitte and Touche.
Shareholders also approved on a non-binding, advisory basis, the compensation of the company’s executive officers.
CEO Robeson Reeves received a total annual compensation of $4.5 million — roughly 103 times what the median Bally’s employee earns, in 2023, according to the proxy statement
Bally’s president George T. Papanier also received a total compensation of $4.5 million; Chief Legal Officer Kim Barker Lee and Chief Financial Officer Marcus Glover each received $1.5 million, and Head of Rhode Island Operations Craig Eaton received $868,517.
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