OLG: get the right development by making priorities public
Councillors can influence how the city's casino development proceeds by making it clear what it expects from the process, say representatives from the Ontario Lottery and Gaming Corp.
Staff from the OLG updated councillors Jan. 29 on exactly what stage the process is at, and sought to clear up some misconceptions about the OLG in general.
Rick Gray, the OLG's vice-president of gaming transformation, said the corporation's mandate was to make money for the province, encourage responsible gambling, promote economic development and the public good.
He said the OLG contributes between $1.7 billion and $2 billion annually to the province and spends $40 million a year to fight problem gambling.
He said eight million people in Ontario gambled last year in some form. The goal of the current modernization process is to put gaming facilities where the people are, Gray said. Having slots facilities at racetracks is not necessarily ideal from a business perspective, he said.
Under a deal that expires March 31, the province has shared revenue from slots facilities at Ontario racetracks with municipalities, track owners and horsemen. Last spring, however, the province announced it was ending that deal in favour of building casinos in 29 gaming zones around the province, including in Northern Ontario.
That led to an outcry from the horse-racing community, which said it couldn't survive without gaming revenue. It also led to concerns from groups worried about the social impact of putting casinos in downtown areas.
Tony Bitonti, the OLG's senior manager of media relations, said it's a myth that OLG relies on problem gamblers for revenue. In fact, he said they don't want problem gamblers at their facilities and staff have sent them home in taxis or banned certain people with obvious gambling addiction problems.
When OLG started the slots program, it didn't have a lot of data on problem gambling in Ontario. But since then, it has collected a wealth of data on the issue and now has the "gold standard" when it comes to running programs to help problem gamblers.
When private sector operators take over the casinos, they will have to match the OLG's efforts, he said. One thing they have learned is that problem gambling tends to spike when new gaming options are introduced, but then they level off.
Bitonti said if OLG had to rely on gambling addicts for revenue, the corporation would "go bankrupt." To succeed, it needs to attract a wider customer base. That's why entertainment options that go along with a casino are key.
Gray said OLG hopes to move to the final stage of the process in the spring and pick who will build and run the casinos in the fall.
Ward 7 Coun. Dave Kilgour asked when the city can get involved in what the development will look like, and Gray said the sooner, the better. The city should make it known as soon as possible what they want to get out of this development, rather than waiting for a specific developer to be selected.
Ward 3 Coun. Claude Berthiaume asked if the city could get a 13-per-cent share of revenue in the future, rather than the 5.25 per cent. That way, the city could share revenue with the horsemen and horseracing in the city could continue.
Bitonti said OLG just signed a new revenue sharing agreement with Sudbury. They also signed a rental deal with Sudbury Downs. And, he added, the revenue sharing details would have to be negotiated through the province, not with the OLG.
Berthiaume, who opposes moving the gambling facility out of Chelmsford, made a pitch for staying at Sudbury Downs and building the casino there. There's lots of room to grow, he argued, and is building-ready. But the OLG staff replied the private-sector operator will decide where to build, based on the best business case.
Ward 10 Coun. Frances Caldarelli, who strongly opposes a downtown casino, asked if OLG knew which income groups use the slots. Most customers at the slots are middle-income earners, came the reply, and the majority of customers — 60 per cent — are over age 50.
Caldarelli said it's a "sad commentary" that the province has come to rely on gambling revenue to operate. She said the only calls she has received in favour of building downtown are from developers. Other callers pleaded with her not to allow it downtown.
She understands why OLG wants it downtown, but says it's a bad idea.
"We need to consider very carefully where this casino will go," she said.
Ward 11 Coun. Terry Kett asked how the casino will help the general population, and the city as a whole.
"How are you looking after us?" Kett said. "How do we know you're on our side?"
Jake Pastore, the OLG's director of municipal and community relations, said it's vital for the city to say publicly what they hope to gain from the casino. The OLG is committed to picking a private-sector operator committed to working with municipalities.
"We want to ensure when we choose the service provider that the provider will have come here" and can work with city, Pastore said. "The city will have to work very closely with that private operator.
"So the city has a lot to gain," he said, beyond just the gaming revenue, which will increase as a result of this process.