An old article, links no longer viable:
"Research shows the casino's music, the pumping in of extra oxygen contributes to keeping people in their seats longer.
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Showing posts with label Ontario. Show all posts
Showing posts with label Ontario. Show all posts
Sunday, May 24, 2015
"Research shows the casino's music, the pumping in of extra oxygen contributes to keeping people in their seats longer.
An old article, links no longer viable:
"Research shows the casino's music, the pumping in of extra oxygen contributes to keeping people in their seats longer.
Monday, May 26, 2014
Something so addictive even governments can't resist
Something so addictive even governments can't resist (Part 2 of 3)
Friday, May 23, 2014 by: Bob MihellGovernments are “addicted” to the money generated from legalized gambling in Ontario.
That is the opinion shared by two addictions experts, who nevertheless agree that gambling likely is here to stay.
“Governments are addicted to gambling revenue because it is a quick way to raise revenue without raising taxes,” said Nigel Turner, a research scientist with the Centre for Addiction and Mental Health.
“It is basically a form of taxation. It taxes people for how bad they are at math. It is a tax on the poor at best.”
Don Burditt, manager of addictions for the local program under the auspices of the Sault Area Hospital, agreed that governments are aware there is money to be made from gaming.
He added, however, that the rationale for government-run gambling is that since it is easily accessible anyway, at least they are able to “exert some control over it”.
Since 1975, when Ontario offered its first lottery draw, Wintario, gaming opportunities have expanded exponentially.
Ontario Lottery and Gaming Corporation (OLG) now employs directly and indirectly 17,000 people in the province, including over 800 in the Sault at OLGs corporate headquarter, and the charity casino.
In total, OLG, a Crown agency, is responsible for 24 gaming sites and the sales of lottery products at about 9,800 retail locations in Ontario.
In the fiscal year ending March 31, 2013, OLG reported revenues totaling $3.4 billion, with net profit to the Province of $1.8 billion.
As part of its modernization plan that would see the day to day operation of gambling activities taken over by private companies, the corporation has projected an annual increase in net profits to the province of about $1 billion by 2017-18.
That figure was higher in 2012 when OLG’s modernization plan first was unveiled, but the rejection by Toronto and Ottawa city councils of large destination casinos in their downtown core that OLG hoped would attract a new breed of richer and younger gamblers, represents a set-back to the corporation’s plan.
The city of Sault Ste. Marie, as host of an OLG charity casino since 1999, has received $22.7 million in gaming revenue, according to media reports.
Although the tax-free revenue has boosted city coffers, there have been serious consequences for problem gamblers in the Sault and across Ontario.
Since the local casino opened for business, five Sault women with admitted gambling addictions were convicted of defrauding their employers of a total of $1,103,000.
Although those criminal trials grabbed headlines locally, crime is not the most significant risk facing problem gamblers, according to the most recent data on problem gambling in Ontario.
Individuals with evolving gambling problems are at a much higher risk of suffering mental and physical health problems, financial debt or bankruptcy, marriage or family breakdowns, and suicidal thoughts or death, than are non-problem gamblers. (see companion article)
Turner said that when the Sault agreed to establish a casino, a motivating factor was to bring gamblers who were crossing to nearby casinos in Michigan, back to the Canadian side.
“The justification for putting in the Sault Ste.Marie casino was all the money was going to the Michigan casinos,” he said. “The alternative was never discussed, which would have been to discourage people from going over to the American side to gamble because it is a losing proposition. That issue never seems to come up in policy discussions.”
Joe Fratesi, chief administrative officer for the city, disagreed however, saying that Turner’s alternative was not realistic or doable.
“It might have been a different discussion if we weren’t located within an hour drive, five minutes in some instances, of 13 casinos that our people could take advantage of,” he noted. “We received in return none of the benefits from employment. So having a casino in our community at least allows us to have some of the benefits that come from those inclined to spend some of their money in gambling.”
Fratesi, who said his viewpoint had not changed, added that likely we would have had problem gamblers with or without the presence of a local charity casino in our city.
“It’s a free country and people will do as they please.”
Fratesi added that among the points made by the auditor-general in her recent report was that the Sault casino was focused on addressing problem gambling.
“I am not sure the same applies to the casinos on the Michigan side,” he said.
Although Paul Pellizari, OLG’s executive director responsible for promoting responsible gambling in Ontario, said the corporation takes it role in reducing the number of problem gamblers very seriously (see related article), Turner and Burditt said the OLG is caught in a paradoxical situation.
On the one hand, they want to attract recreational gamblers to their gaming opportunities, but on the other hand, a large percentage of their revenue comes from addicted gamblers, estimated at 24.1 percent, according to the most recent academic study.
The good news is that problem gambling has shown a steady decline, for a variety of reasons, since it peaked in the mid 1990s.
The problem for the OLG, Turner suggested, is how the corporation can fulfill its promise to raise more revenue for the province without reversing the downward trend in problem gambling.
“You pretty much have to addict people if you want to make more money from gambling because that is a large part of where they make the money,” Turner said. “The same problem, by the way, occurs with alcohol. A disproportionate amount of the revenue from alcohol sales comes from people with a drinking problem.”
Turner, however, said it is “definitely possible” to reduce the harm. Part of the solution would be to inform problem gamblers that “maybe they are gambling too much” at an earlier stage, before they start to lose control.
“That is one of the things OLG say they plan to do,” he said. “I would say OLG is doing better than they were in the past.”
Turner said that some problem gambling is inevitable, and the solution is to develop policies that creates a balanced approach.
“If you ban all gambling opportunities, you are giving that market to illegal operators.”
Meanwhile Pellizzari said the issue of problem gambling is important to the OLGs gaming operations and modernization plan.
“For us to derive too much of our revenue from a base of players who have a problem is not a good path for OLG to be on,” he stressed.
He said that there is a perception that OLG is “conflicted” in trying to make money from gambling while promoting responsible gambling.
He said that actually, the opposite was true for two reasons.
First, he said that OLG sites primarily served Ontario residents, and it was in OLG’s best interests, from a mature business standpoint, to broaden its base of people playing in a healthy way, rather than relying on a narrow base of problem gamblers.
Second, Pellizzari said, the OLG would do better on both ends of its mandate, “making money and protecting players”, by having responsible gambling safeguards in place to keep people from getting into trouble and ensuring they remain as customers.
And on a final point, he stressed that when OLG transfers the operations of its casinos and gaming activities to the private sector, that responsible gambling would remain a “pillar” of OLGs future role in protecting the public interest.
He said that there would be an obligation for private contractors both in requests for proposals, and written contracts to abide by OLGs responsible gambling rules, and oversight.
Those agreements would include: “Thou shalt put in responsible gambling centres where OLG says, thou shalt take CAMH training, and thou shalt use the technology we dictate.
*************************
Part 1 - What makes gambling such a problem
http://www.sootoday.com/content/news/details.asp?c=73500
Monday, September 30, 2013
OLG began review of racetracks’ spending of slot revenues in 2010
Friday, August 30, 2013
Money from slots has done nothing to improve horse racing
But every racing fan knows what happened instead. When slots were legalized, the machines proved to be so lucrative many track owners lost interest in the sport and viewed it as a nuisance. They made no effort to improve the game or attract new fans; slot players are more profitable customers.
The day-to-day racing at tracks such as Philadelphia Park and Delaware Park is just about as dreary as it was before slots inflated the purses. One track that has made the most of slot money is Woodbine, in Toronto, which offers some of the best daily cards on the continent and uses its resources to promote the sport and to create new horseplayers. But Woodbine is a rarity.
More often, slot money props up tracks that have virtually no fan base and couldn’t exist on their own merits. This is true of most harness and dog tracks, and some thoroughbred operations — such as Presque Isle Downs. Two previous racetracks in Erie, Pa., went broke from lack of support. Presque Isle was built when slots were legalized in the state, and it had to be a racetrack to get the machines, but its racing business is as pitiful as that of its predecessors. The track’s average attendance last season was 705, and those customers bet an average of $35,000 per day on the live product. Yet Presque Isle pays huge purses — more than $200,000 a day.
While the money has benefited owners, trainers and Pennsylvania breeders, it has done nothing to popularize or improve horse racing. On the contrary, it has hurt the sport in some ways. At a time when almost every track is suffering from a shortage of thoroughbreds, the horses who go to Erie could be running at viable tracks, helping them to offer a better product, instead of racing in a place where almost nobody watches them.
Too many people in the thoroughbred industry are content with the status quo. In the crowded mid-Atlantic region, racetracks should agree to pare down their schedules, offering fewer races with larger fields that fans want to bet. But horsemen habitually resist such cutbacks, and most tracks continue to lose fans.
However, the status quo is unsustainable because more and more politicians will be asking: Why should we subsidize a sport that so few people care about? Why should we help an industry that won’t help itself? And thoroughbred racing can offer no good responses to these questions.
For Andrew Beyer’s previous columns, go to washingtonpost.com/beyer.
http://articles.washingtonpost.com/2012-03-19/sports/35448728_1_slot-money-horsemen-purses
Monday, July 22, 2013
Are you really safe in a casino?
No surveillance cameras? No security to protect patrons?
CITY POLICE
NEWS RELEASE
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On July 21st a female contacted the police to report that while she was walking to her car in the parking lot of the Sault Ste. Marie Casino on Friday July 19th, two males came up from behind her, stole her purse and ran westbound.
The only description available was that both were wearing dark hoodies.
She was not injured.
The investigation is continuing.
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If you have any information regarding these crimes, or any other crime, call Crime Stoppers at 705-942-7867 or 1-800-222-8477 (TIPS), submit an e-tip from the Crime Stoppers’ website at www.saultcrimestoppers.com or text keyword SSM with your tip to 274637.
Text STOP to 274637 to cancel.
Text HELP to 274637 for help. Msg & Data Rates May Apply.
http://www.sootoday.com/content/news/details.asp?c=59610
Purse snatched at Casino parking lot
Monday, July 22, 2013 by: SooToday.com StaffCITY POLICENEWS RELEASE
***************************
On July 21st a female contacted the police to report that while she was walking to her car in the parking lot of the Sault Ste. Marie Casino on Friday July 19th, two males came up from behind her, stole her purse and ran westbound.
The only description available was that both were wearing dark hoodies.
She was not injured.
The investigation is continuing.
**************************
If you have any information regarding these crimes, or any other crime, call Crime Stoppers at 705-942-7867 or 1-800-222-8477 (TIPS), submit an e-tip from the Crime Stoppers’ website at www.saultcrimestoppers.com or text keyword SSM with your tip to 274637.
Text STOP to 274637 to cancel.
Text HELP to 274637 for help. Msg & Data Rates May Apply.
http://www.sootoday.com/content/news/details.asp?c=59610
Friday, June 7, 2013
Doubling down on casinos
Doubling down on casinos
Provinces are addicted to gaming revenue, and it’s a dependence that’s only going to get worse
Sharon Doucette/CP
Care to bet on it? The reality is that Toronto’s casino plans collapsed not because of the groundswell of moral outrage over the idea of introducing gambling into the city’s downtown, but because Mayor Rob Ford—a staunch casino supporter—complained the city wouldn’t get a big enough cut of the profits. In fact, far from putting the brakes on the OLG’s modernization plans, Wynne quickly promised her government would proceed “full-steam ahead” on a proposal to nearly double the $1.9 billion in profits it makes every year from its gambling operations.
Ontario’s government is hardly alone in its unabashed enthusiasm for gambling. From lotteries, to casinos, to electronic gaming machines at bars and restaurants, gambling now generates an astonishing $14 billion a year in revenues for provincial governments, up from just $2.7 billion 20 years ago. Half of that is pure profit, with most of it flowing directly into provincial coffers. Alberta, B.C., Ontario and Quebec each now take in more in gambling revenues than Nevada. Provincial governments now get about 2.3 per cent of their total revenues from gambling. It’s as high as 4.2 per cent in Alberta, where gambling revenues are the equivalent of nearly half of royalties from the oil sands. Ontarians hand over more money to the province from gambling than they pay in gas taxes, and the amount B.C. raises from its gambling operations is nearly as much as the province spends each year on economic development.
Where Canada once steadfastly banned all forms of gambling, worried about the social costs of legalizing games of chance, today the country is home to more than 70 casinos, 30,000 lottery-ticket outlets and nearly 100,000 slot machines and video lottery terminals. Politicians who might have once wrung their hands over how gambling would create a nation of addicts now oversee governments that pump hundreds of millions every year into advertisements to encourage taxpayers to try their luck. Ontario alone gave away more than $335 million in 2011 in “promotional allowances” such as free food, liquor and hotel rooms to encourage high rollers to gamble even more.
And gamble we do. Governments collected nearly $550 in gambling revenues for every Canadian adult in 2011, according to the Canadian Partnership for Responsible Gambling. The average in Saskatchewan was more than $850, the highest in the country. In fact, Canada has among the highest per capita gambling revenues in the Western world—behind only Australia, Norway and New Zealand, and well ahead of the U.S. By 2004, Canadian governments reaped roughly $105 per person from VLTs and slot machines outside of casinos, compared to just $13 in the U.S., according to Gambling For Profit, the 2011 book by Canadian researcher Kerry Chambers.
But all that gaming revenue comes at a steep cost, one that politicians and proponents of government-run gambling are far too quick to dismiss. Those who support state-managed casinos and lotteries insist they are simply a voluntary tax, and that gambling addicts will find some other way to get their fix if governments don’t provide it. Yet the massive build-up of government’s role in the gambling industry has come squarely on the back of problem gamblers—with roughly half of all gambling dollars coming from those with some degree of gambling addiction.
And as lucrative as gambling has become for the provinces, the growth of gaming revenues has begun to slow in the past few years. This comes at a time when deeply indebted provinces are scrambling to find ways to meet their spending promises. So rather than scaling back their gambling operations, provincial gaming authorities are doubling down, blanketing the country with glitzy get-rich-quick ad campaigns, offering bigger lottery jackpots and pursuing more casinos. Some provinces have delved into the world of Internet gambling, making it even easier for people to bet from their homes, while a push is under way for a controversial style of sports betting that allows people to place wagers on individual games—something that has, until now, been banned partly over fears it will lead to a spike in sports-betting addictions.
These are the final frontiers of gambling, warns Robert Williams, a gambling researcher at the University of Lethbridge, and it shows province-run gambling operations are reaching “a saturation point. It’s like an addict looking for any remaining veins. You save the vein in your neck for the very last. The things that are being contemplated now are the things that make the least sense.” And show the most desperation.
The speed with which governments’ gambling operations have moved from temporary lotteries and casinos into multi-billion-dollar enterprises would shock the politicians who paved the way for them just four decades ago.
Gambling was declared illegal in 1892 when leaders worried its get-rich-quick ethos would destroy the Protestant work ethic. It remained a criminal offence for three-quarters of a century until, under pressure from Quebec to pay off its Expo 67 debts and finance the Montreal Summer Olympics, prime minister Pierre Trudeau legalized lotteries in 1969, stuffing the legislation into an omnibus crime bill that also legalized abortion, homosexuality and expanded gun control.
Almost immediately, provincial governments created their own lotteries as a defensive measure against state-run lotteries from Ireland and South America that were placing ads in Canadian newspapers. Prophetically, opponents complained the state-run lotteries would not only create a generation of gambling addicts, but that the new revenue source would only entice provinces to pursue gambling even more. They were roundly rebuffed. Ernie Hall, a cabinet minister in B.C.’s NDP government in 1974 who’d just announced a bill to legalize provincial lotteries, scoffed at the notion it would end up with “a drink-crazed, poverty-stricken idiot walking down the main street of Granville . . . There is no intention for this government to look upon the lottery income as a significant part of its revenue at all.” Today, gambling generates $1.1 billion in profits for B.C.
The Ontario Lottery and Gaming Corporation was created in the 1970s to oversee a single lottery, Wintario. It raised $76 million in its first year, most of that earmarked for local charities and community groups. Five years after its launch, critics were already complaining that televised Wintario draws were being held in local high schools, with provincial cabinet ministers routinely showing up to get the drum rolling.
These days, the province generates close to $2 billion in gambling profits and the OLG describes itself as “the greatest business operation of our provincial government—and for that matter perhaps any government in Canada.”
As governments have found, and critics warned, the money proved almost too easy; so much so that gambling became the go-to fix every time a government needed to dig itself out of debt after a recesssion. In 1995, Manitoba balanced its first budget in more than two decades after plunging into the gambling industry, thanks largely to having opened the country’s first resort casino in Winnipeg’s Hotel Fort Garry a few years earlier. Meanwhile, Ontario’s NDP government of the 1990s announced its first resort casino would be built in Windsor, after the automotive heartland had been hit by a double whammy of recession and free trade.
At each step, proponents heralded their new gambling initiatives for their economic virtues, whether helping to revive dying communities or to build new schools and highways. But critics say casinos are a questionable economic development tool. “Gambling doesn’t create wealth, it’s a sterile transfer of wealth,” says University of Lethbridge’s Williams. Except for Macau or Las Vegas, where the entire economy is based around luring outsiders to try their luck, gambling tends to just suck money out of other local retail and entertainment businesses and into government coffers.
“A lot of people don’t gamble at all and they basically see the revenue from gambling as keeping their taxes lower,” says Chambers, author of Gambling For Profit. “Governments will say gambling revenues this year went to pave 40 miles of road or pay for 10 hospitals. They’re linked to positive symbols and people who pay attention to these things see the benefits of it and they rarely see the negative outcomes.”
For the majority of Canadians who gamble—and roughly three-quarters do—there are few negative outcomes other than lightening our wallets. But for the estimated one million people who have developed a gambling problem, the consequences can be dire. The Canada Safety Council estimates there are nearly 200 suicides every year because of gambling addictions. Phyllis Vineberg’s son, Trevor, committed suicide in 1995 at age 25 after having lost an estimated $100,000 to government-owned video lottery terminals. “My struggle has led me to the unfathomable realization that it is our own governments who are preying on their citizens,” she told an international gambling conference in Halifax in 2004, estimating that in the nine years after her son died there had been enough gambling-related suicides in Canada “to fill two Titanics.”
In a study released last month, Williams found nearly half the money governments raised from gambling comes from players who have a gambling problem. Addiction rates are far higher for slot machines and video lottery terminals than for lotteries and bingos. Yet these electronic gaming machines make up close to 60 per cent of all provincial gambling revenues—and nearly two-thirds of that money comes from gambling addicts.
Despite the disproportionate share of revenues that come from addicts, provinces dedicated just $82 million of their $7 billion in profits in 2011 toward problem-gambling research and treatment.
Governments have what their lottery corporations consider a much more serious problem: For every person who gets addicted to one of their games, far more grow bored or skeptical of ever winning and either stop playing or move on to games elsewhere. In the rush to build new casinos and video lottery terminals, government gambling revenues doubled between 1992 and 1997. Then the excitement wore off. Gambling revenue grew just 14 per cent between 2004 and 2011—less than the rate of inflation.
Part of the problem, says Williams, is that building more casinos so gambling revenues don’t leave the province can have the opposite effect; once residents get a taste for a new type of government-run gambling, it whets their appetite for better games with bigger prizes—and even more money ends up flowing out of a local economy. When B.C. launched its online casino games last decade the move was meant to stop money flowing to offshore gambling sites. Now Williams estimates the government takes in just half what British Columbians wager online.
It’s a diminishing return on investment that is forcing governments to search for more ambitious ways to soak gamblers. Lotto Max, the nationwide lottery launched in 2009, now promises regular $50-million jackpots. Likewise, Lotto 6/49 saw ticket sales spike when it offered record-breaking $55-million jackpots in the summer of 2011. But the Western Canada Lottery Corporation warned the boost would be short-lived. “It was the first time that players in Canada had seen those kinds of jackpots for that length of time and the ‘first time’ can only happen once.”
In addition to B.C., Manitoba and Quebec now offer online casino games like poker and blackjack. In Manitoba the government plans to lift a 20-year moratorium on video lottery terminals—a moratorium sparked by outrage over a rash of gambling-related suicides. Meanwhile, Health Canada was forced to take two casinos in Niagara Falls, Ont., to court to stop them from running a promotion that allowed gamblers to trade loyalty points for cigarettes—a perk the casinos argued they needed to stay competitive.
More changes are coming. Federally, an NDP private member’s bill aims to change the Criminal Code to allow for betting on single sporting matches—legally Canadians can only bet on a minimum of three games at a time. The bill sailed through the House of Commons only to face opposition from senators concerned it could lead to an explosion in sports-betting addictions. Professional sports teams also oppose it, saying it opens the door to match-fixing.
Yet despite the social and economic costs of the provinces’ big bets on gambling, Williams warns it will be nearly impossible for them to wean themselves off the easy money. “If any province suddenly declared gambling illegal, they would see a pretty significant economic loss to other provinces or to the States because you’ve created this culture of gambling,” says Williams. And as any addict can tell you, once you’re hooked, it can be awfully hard to stop.
http://www2.macleans.ca/2013/06/03/doubling-down-2/
Thursday, June 6, 2013
The Playbook Failed
Unspoken in the Playbook of Predatory Gambling is: RUSH!
It doesn't often fail.
But the casino is different.
Watson has supported an expansion of gambling in Ottawa since long, long before it was was on anybody else’s agenda. Watson made a point of saying that in a scrum with reporters Tuesday, noting that he advocated for table games to augment the Rideau Carleton Raceway’s slot machines when he was an MPP and nobody would give him the time of day on that particular thing. And then he backed it as mayor, getting city council to ask the province to let the raceway add table games very early on, in a move that was ultimately overtaken by the Ontario Lottery and Gaming Corp.’s expansion plans.
This suggests his belief that Ottawa would be better off with more, and more interesting, gambling is genuine. It’s not a pose, not a political favour for friends at Queen’s Park.
So when the OLG came along with its modernization project, Watson probably thought, “Hey, great.
Let’s get going.” But being a canny politician, he’d have known there’d be some pretty vocal opposition to the idea. Maybe not from a majority of residents, but from enough people to kick up an unpleasant fuss, frighten some politicians, and maybe put a new Ottawa casino at risk.
Let’s say you figure 25 per cent of the population is against expanding gambling, 25 per cent are actively for it, and half the people just don’t much care one way or the other. We have slot machines at the racetrack, where you can place bets, and nobody’s talking about shutting either of them down.
The casino in Gatineau is a major attraction and nobody really calls for it to be shut down, either. So if you want to expand gambling and you figure most people don’t care about it but a vocal minority will make things unpleasant, what do you do?
You try to get the expansion approved as fast as possible. Lingering on the question won’t change very much except give that vocal minority of opponents more time to make things ugly. So get on with it, get a vote passed, and drop it from the agenda till OLG presents a specific proposal to debate.
But then a couple of things went wrong.
First, opposition to a new casino is probably stronger than 25 per cent, and the rush to get a council vote out of the way activated a bunch of that opposition in a way that an even slightly slower process might not have.
Second, despite how quickly the City of Ottawa got the thing done, the OLG‘s process turned into a gong show. Toronto’s drawn-out debate kept the issue on the periphery of the news in Ottawa. Dalton McGuinty and Dwight Duncan resigned and were replaced by the much less gambling-friendly Kathleen Wynne and Charles Sousa, who are a lot less willing to bulldoze criticism and opposition.
The question of how much money the City of Toronto would get from a casino turned into a real debacle that culminated in the dismissal of OLG chairman Paul Godfrey (who’s CEO of Postmedia Network Inc., which owns the Citizen) and the mass resignation of the rest of the board.
So instead of a quick vote, a brief outcry and then silence for 18 months, we got a constant drumbeat of casino-related news that reminded everyone over and over and over again that Ottawa hurried to a vote in way other cities didn’t.
The first was a miscalculation. The second was a serious of unfortunate events that nobody could have foreseen. And here we are, with Watson fighting a rearguard action to preserve the Rideau Carleton Raceway and interest in a casino collapsing like a deflating balloon.
http://blogs.ottawacitizen.com/2013/06/05/what-went-wrong-with-the-casino-a-hypothesis/
It doesn't often fail.
What went wrong with the casino (a hypothesis)
In his two-plus years as mayor, Jim Watson has not botched a file as badly as he has the question of whether Ottawa should get a new casino. He may have done things some people don’t like, but he’s generally done them cleanly, keeping things moving through city council and avoiding ugly, pointless confrontations. That’s widely seen as part of the Watson brand: he’s a highly competent politician. He knows what he wants and he almost always gets it.But the casino is different.
Watson has supported an expansion of gambling in Ottawa since long, long before it was was on anybody else’s agenda. Watson made a point of saying that in a scrum with reporters Tuesday, noting that he advocated for table games to augment the Rideau Carleton Raceway’s slot machines when he was an MPP and nobody would give him the time of day on that particular thing. And then he backed it as mayor, getting city council to ask the province to let the raceway add table games very early on, in a move that was ultimately overtaken by the Ontario Lottery and Gaming Corp.’s expansion plans.
This suggests his belief that Ottawa would be better off with more, and more interesting, gambling is genuine. It’s not a pose, not a political favour for friends at Queen’s Park.
So when the OLG came along with its modernization project, Watson probably thought, “Hey, great.
Let’s get going.” But being a canny politician, he’d have known there’d be some pretty vocal opposition to the idea. Maybe not from a majority of residents, but from enough people to kick up an unpleasant fuss, frighten some politicians, and maybe put a new Ottawa casino at risk.
Let’s say you figure 25 per cent of the population is against expanding gambling, 25 per cent are actively for it, and half the people just don’t much care one way or the other. We have slot machines at the racetrack, where you can place bets, and nobody’s talking about shutting either of them down.
The casino in Gatineau is a major attraction and nobody really calls for it to be shut down, either. So if you want to expand gambling and you figure most people don’t care about it but a vocal minority will make things unpleasant, what do you do?
You try to get the expansion approved as fast as possible. Lingering on the question won’t change very much except give that vocal minority of opponents more time to make things ugly. So get on with it, get a vote passed, and drop it from the agenda till OLG presents a specific proposal to debate.
But then a couple of things went wrong.
First, opposition to a new casino is probably stronger than 25 per cent, and the rush to get a council vote out of the way activated a bunch of that opposition in a way that an even slightly slower process might not have.
Second, despite how quickly the City of Ottawa got the thing done, the OLG‘s process turned into a gong show. Toronto’s drawn-out debate kept the issue on the periphery of the news in Ottawa. Dalton McGuinty and Dwight Duncan resigned and were replaced by the much less gambling-friendly Kathleen Wynne and Charles Sousa, who are a lot less willing to bulldoze criticism and opposition.
The question of how much money the City of Toronto would get from a casino turned into a real debacle that culminated in the dismissal of OLG chairman Paul Godfrey (who’s CEO of Postmedia Network Inc., which owns the Citizen) and the mass resignation of the rest of the board.
So instead of a quick vote, a brief outcry and then silence for 18 months, we got a constant drumbeat of casino-related news that reminded everyone over and over and over again that Ottawa hurried to a vote in way other cities didn’t.
The first was a miscalculation. The second was a serious of unfortunate events that nobody could have foreseen. And here we are, with Watson fighting a rearguard action to preserve the Rideau Carleton Raceway and interest in a casino collapsing like a deflating balloon.
http://blogs.ottawacitizen.com/2013/06/05/what-went-wrong-with-the-casino-a-hypothesis/
Thursday, May 23, 2013
OLG financial records raise red flag
From: Dianne M. Berlin
OLG financial records raise red flag for Hamilton casino plan
The Hamilton Spectator’s Steve Buist investigates some surprising trends in the OLG strategy.
BySteve Buist
Ontario's four premier resort-style casinos have lost a combined $360 million in the past six years while handing out $1.6 billion in freebies and cash incentives to gamblers at those same facilities.
Meanwhile, the province's 17 racetrack slots facilities — three of which have closed and the rest face elimination or restructuring by Ontario's gambling regulator — and six smaller charity casinos have recorded $5.6 billion in profits over the last six fiscal years.
Since 2007, the 23 racetrack slot facilities and charity casinos have churned out average profits of $2.6 million a day while Ontario Lottery and Gaming Corp. has spent nearly $1.1 million a day over the same period on freebies, cash incentives, marketing and promotion just on the four money-losing major casinos located in Niagara Falls, Windsor and Rama.
The four major casinos have collectively lost money for six straight years and gone from recording a combined net profit of $108 million in 2006 to combined losses of nearly $80 million last year.
The recent trend of financial results for OLG's gambling operations raises important questions about the casino model being considered for Hamilton.
OLG is in the midst of a modernization process intended to overhaul the gambling industry in Ontario, particularly the types of facilities that will exist in the future.
For places like Hamilton and Toronto which currently don't have casinos, that likely means a swing away from a slot machines-at-racetracks model to full-fledged casinos with slot machines, table games and amenities that could include restaurants, entertainment and hotels.
In other words, a model that mimics OLG's four money-losing resort-style casinos.
Robert Williams, a University of Lethbridge professor and one of Canada's leading researchers on gambling issues, raises questions about OLG's change in strategy.
"To its credit, Ontario has held out and hasn't put a casino in Toronto and Hamilton because it doesn't make any sense from either an economic or social standpoint," said Williams, who obtained a PhD in psychology from McMaster University. "If this was such a good idea — placing casinos in Toronto and Hamilton — why wouldn't it have been done 25 years ago?
"To me it's more analogous to an addict running out of veins to tap."
OLG has divided the province into 29 zones and invited municipalities and the private sector to work together to create a new gambling landscape for the province.
First on the chopping block are the racetrack slot machine sites, which have helped keep horse racing tracks alive for the past decade thanks to the $345 million in slot machine revenues pumped annually into racing purses.
"As long as slots facilities are linked to individual racetracks, OLG is unable to consider alternate locations for gaming sites," according to an OLG background document. "Over time, this has resulted in the location of gaming facilities in places unrelated to customer interest."
About half of the remaining racetrack slots are located in smaller communities or rural settings, such as Flamboro Downs.
"Our world has changed so significantly and we cannot continue to sustain the business model that we have and be able to appease the customers," said Larry Flynn, OLG's senior vice-president of gaming.
"One of the disadvantages of our current model and why we need to modernize is that our customers are very sophisticated and they're very accustomed to the different offerings that resort properties would give both in the U.S. and beyond," Flynn added.
"The new model is about trying to find the right amenities in the right location in the areas where the majority of customers are situated so they're not driving a significant distance."
As part of its modernization plan, OLG wants to be more consumer-responsive, efficient and expand the private sector's role in gambling delivery. By 2017, it also wants to add another $1.3 billion in net annual profits directed to the provincial government on top of the nearly $2 billion already provided each year.
Debate over the possible location for a new Hamilton casino has divided residents between those who favour expanding the current Flamboro Downs site and those who prefer a downtown location to help spur additional development.
People in Hamilton are also split on the need for a casino at all. A Spectator telephone survey of 5,400 residents last fall showed 56 per cent opposed a casino in Hamilton.
Hamilton's business community appears to be just as divided as the rest of the city on the issue of a casino.
A survey of businesses conducted by the local Chamber of Commerce earlier this year showed a near-even split between those that did and those that didn't want a casino, and the same split between the downtown and the current Flamborough slots site as the location if Hamilton does proceed with a casino.
In February, Hamilton councillors designated Flamboro Downs as the preferred site for a new casino, but a downtown location could still be considered if private-sector bidders can show Flamboro Downs wouldn't be a viable option.
A month later, OLG announced that the racetrack slots program at Flamboro Downs would continue for another five years as part of a new agreement, muddying the waters in the short term on what might happen with any future casino proposal for Hamilton.
And just last month, Ontario's auditor general was asked investigate OLG on a number of fronts: everything from the transparency of the proposed casino expansion process, to the transparency of the payment formulae for host municipalities, to revenue projections, to the economic impact of cancelling the funding for the racetrack slots program.
Norm Schleehahn, the city's manager of business development and the point person on casino issues, declined to comment on OLG's financial performance and the implications for Hamilton.
"Unfortunately, I simply can not make comments on OLG actions related to casino operations, revenues and strategies," Schleehahn stated in response to an interview request.
OLG's modernization plan sank further into disarray last week with the surprise announcement that the Liberal government had abruptly sacked chairman Paul Godfrey. Within hours, OLG's entire seven-member board of directors resigned in protest
• • •
OLG's year-to-year financial results since 2007 raise some red flags about gambling in Ontario.
A Spectator examination of OLG's annual reports from the past six years shows:
• Attendance has taken a nose dive at Ontario's four resort casinos.
Between 2007 and 2012, the average daily attendance at the four casinos in Niagara Falls, Windsor and Rama has plunged by 25 per cent, from nearly 55,000 daily visits to just over 41,000.
Gaming revenue at the four casinos, not surprisingly, has taken almost the same hit. Combined gaming revenue fell from $1.69 billion in 2006 to $1.21 billion in 2012, a decline of 28 per cent.
Gaming revenue at the 23 racetrack slots and charity casinos has remained essentially unchanged for the past five years.
"The business has really been flat over the last number of years," said Flynn. "We certainly have tried to drive as much efficiency and manage the properties as best we can but like any business, you need to constantly look for ways to do it differently."
•OLG spends nearly four times as much on freebies and incentives at its four resort casinos than it does on the other 23 racetrack slots and charity casinos combined.
Between 2007 and 2012, OLG spent about $1.63 billion at the four resort casinos on so-called promotional allowances, such as cash rewards, gifts and free hotel rooms, compared to about $440 million at the 23 other gambling sites.
• In the past six years, OLG has spent $3.2 billion on promotional allowances, marketing and promotions for all of its gambling sites.
At the four resort casinos, incentives, marketing and promotions chewed up 31 per cent of all gambling revenue in the 2011 fiscal year.
At the charity casinos and racetrack slots, the proportion of gambling revenue spent on incentives, marketing and promotions was just 8.3 per cent.
• In 2011, OLG spent more than 14 times as much money on incentives, marketing and promotion as it did on promoting responsible gambling.
The practice of offering rewards to gamblers is a sensitive one, since those who qualify for the largest rewards are those who gamble the most.
A 2007 study co-authored by Williams and his Lethbridge colleague Robert Wood showed that more than a third of total gambling expenditures in Ontario come from problem gamblers, a tiny fraction representing less than 4 per cent of the overall gambling clientele.
"We're in the promotions or loyalty program business because it's something customers have grown to expect," said Flynn. "We understand there certainly are people with problems who game at our facilities and we've tried to put into place programs that would help them help themselves, like self-exclusion.
"We have certainly invested significantly more money than any other jurisdiction in North America in these programs we have and educating employees."
• Jobs are often cited as one of the spinoff benefits for communities that host a gambling facility.
But at Ontario's four resort casinos, the number of employees has actually declined by nearly 16 per cent since the 2007 fiscal year, from 11,790 employees to 9,931 last year.
At the racetrack slots and charity casinos, the number of employees declined slightly between 2007 and 2012, from 6,420 to 6,370.
That number will likely drop noticeably in the 2013 fiscal year, though, now that three racetrack slot operations have since closed.
The three that closed were in the border municipalities of Fort Erie, Windsor and Sarnia — a further sign that Ontario's gambling world has become more insular.
• OLG acknowledges that the bulk of its customer base is "aging rapidly," according to a 2012 strategic business review. Nearly 80 per cent of the gambling customer base is older than 50.
The conundrum for OLG? Nearly 90 per cent of its gaming revenue comes from slot machines, "which have limited appeal to players under 45," OLG reports.
In 2011, the average annual revenue per slot machine at the resort casinos was $96,600. At the racetrack slots, average revenue per machine was $156,000.
"It doesn't really matter where you put those things because the revenue per machine is roughly equivalent," said Williams. "It doesn't matter if you put these machines in a fancy casino or a racetrack or with table games.
"The less you spend on the accompanying structure, the more profitable you're going to be."
• • •
A money-losing casino? Surely it's an oxymoron, like jumbo shrimp or pretty ugly.
But it's not as far-fetched as you might think.
There's a cautionary tale to be found south of the border in the heavily populated tri-state area of New Jersey, Pennsylvania and Delaware — which encompasses the traditional gambling haven of Atlantic City and the large metropolitan areas surrounding Philadelphia and New York City.
A recent academic paper on gambling trends in the three states showed that gambling revenues in Atlantic City, which had a monopoly on casino gaming for decades, plunged when casinos opened a few years ago in Pennsylvania. As new gambling sites opened, they simply cannibalized business from other locations.
In just six years, gambling revenue in New Jersey fell by nearly half, dropping from $5.2 billion in 2006 to $3 billion in 2012.
The Revel casino in Atlantic City, built for $2.6 billion, opened just last year and it has already filed for bankruptcy protection.
But more importantly, the study also showed that the overall amount of gambling declined as well, even as the number of venues increased.
Now Pennsylvania, which poached a good chunk of its business from Atlantic City, is facing its own pressures. Gambling revenues in the state have dropped in five of the last six months compared to the same month a year earlier.
Here in Ontario, three of the four resort casinos — Windsor and the two in Niagara Falls — were strategically situated near the U.S. border to attract American tourists, particularly those from the border states of New York and Michigan, which didn't have gambling options nearby.
Since then, however, the Canadian dollar has risen to par with its American counterpart, gas is more expensive, passports are required to cross the border and casinos are now scattered across virtually every U.S. state.
Between 1998 and 2008, the number of Americans crossing into Windsor, for example, dropped by 74 per cent. There are also casinos now in Detroit and Niagara Falls, N.Y.
The days of relying on Americans as a reliable source of gambling revenue are likely over, according to Williams, the Lethbridge professor.
"It's a bit naive to think people are going to come to Ontario from anywhere else to gamble and spend multiple days at a hotel complex," said Williams. "No matter where you place your casinos, it's all going to be local people from here on in."
Williams believes large resort-style casinos no longer make sense in Ontario.
"Anyone who's going to gamble at any Ontario venue from here on in are going to be Ontario residents and they aren't going to spend a couple of days as would American tourists," he said.
"People are going to drive there and drive home."
Under OLG's new zoning model, there could be full-fledged casinos in Toronto, Etobicoke, Milton, Hamilton, Brantford and two in Niagara Falls.
Flynn said southern Ontario's population can support them, and he expects the gambling base to actually increase.
"I don't believe it will be just taking the same number of customers," said Flynn. "The full objective here is to be able to provide for those customers who aren't making a choice to participate in gaming because they can't access product when they want or the type of product they want.
Hamilton Ward 4 Councillor Sam Merulla, a spirited opponent to a downtown casino, says OLG's business plan isn't working. It's also objectionable, he added.
"Rather than targeting tourists, they're now looking at targeting Ontarians," said Merulla. "But what really becomes more insulting is that they cannibalize people in areas and in cities that are the most marginalized, such as Hamilton.
"OLG, from my perspective, governs themselves no different than a common crack dealer," he added.
It's not an analogy Merulla uses flippantly. While he's known primarily as a city councillor, Merulla is also an addictions counsellor by trade.
Merulla worries that those in the lower inner city, where poverty rates are highest, might not have had the opportunities to travel to the larger casinos in the past. With a casino easily accessible in downtown Hamilton, however, Merulla fears participation rates and social problems will inevitably increase.
"When you're trying to put a casino in a downtown core rather than leave it in Flamborough, what they're telling us is that we know there is a significant amount of people who are impoverished or vulnerable yet have some disposable income," said Merulla. "And we don't care how much that disposable income is, we just want a share of it.
"A crack dealer doesn't stand in the middle of Flamborough waving down cars," he said.
"They go into the heart of a city where the people are, to try to get them hooked."
Sunday, May 12, 2013
Keep this region casino-free
Editorial
Keep this region casino-free
Editorial cartoon by PERRY
Kill it, Kitchener council. Kill the casino proposed for Waterloo Region.
You have the opportunity — a vote on Monday to say yea or nay to a gaming establishment in your city. You have the best of reasons. It’s not worth betting the future of the vibrant and progressive community of Waterloo Region on such a risky venture. And now, it appears, you have the power.
In response to an avalanche of local political opposition, Ontario Premier Kathleen Wynne raised the stakes in the casino debate this week when she ordered the Ontario Lottery and Gaming Corporation to rethink its handling of the casino venture in Waterloo Region. In February this newspaper urged her to review a process that pitted governments and communities against each other. We are pleased that she is doing so.
Until now, developers seemingly had a green light to build a gaming establishment in Woolwich Township. That’s because Woolwich council voted in March to host a casino. According to the rules by which the gaming corporation had been playing, Woolwich’s decision meant a casino could open its doors in the township — regardless of what the rest of the region thought.
Had those rules held, there might have been an argument for Kitchener to put out its own welcome mat. After all, if a casino was coming to the region anyway, possibly just a few kilometres east of the city, why wouldn’t Kitchener accept one within its own boundaries? At least then it could claim a cut of the revenue — millions of dollars a year — that would compensate it for the social ills a gaming establishment would bring.
But the premier’s intervention changed this. Now there’s every reason to think that if Kitchener rejects a casino, the proposal will die — not just in the city but in the entire region.
Most local governments are already standing shoulder to shoulder against a casino. Cambridge, Waterloo and Wilmot Township all spurned the offer of one. In a gutsy move this week, Waterloo regional council voiced its moral opposition to a gaming establishment. If Kitchener lines up with these other governments, Woolwich will be the lone voice favouring a casino within this provincially designated gaming zone. And the tide of opposition could sweep the casino proposal from every table.
This newspaper does not oppose all gambling. When controlled and regulated by government, it is a legitimate form of recreation for adults. And Ontario has for many years allowed a limited number of casinos to operate in the province.
This newspaper is, however, alarmed by the provincial government’s policy of promoting a massive expansion of gambling, both in casinos and through online betting. The Ontario Lottery and Gaming Corporation’s stated goal is to increase its gambling revenues by $1 billion a year. New casinos are proposed for London, Woodstock, Hamilton and Toronto, as well as this region.
We all know gambling causes enormous pain and suffering. It bankrupts individuals. It tears families apart. Even casino advocates admit this. Dr. Liana Nolan, the region’s chief medical officer of health, estimates a casino would create 10,000 new moderate to severe problem gamblers in Waterloo Region, Guelph and Centre Wellington. “It’s better to prevent these problems by not having (a casino) in the first place,” she concludes.
Casino boosters might say the doctor is exaggerating. But why gamble that she’s wrong? Ontario should not increase its reliance on casinos to pay for the province’s schools and hospitals.
As for the business case, the jury of economists is out on whether casinos help or harm a local economy. Some small and economically depressed communities benefit from casinos, and Brantford is one that has. But Waterloo Region has one of the most dynamic economies in Canada.
Yes, a casino would create new jobs. Yes, it would attract visitors to the region — though its potential for boosting local tourism would be reduced if all the other proposed casinos open across the province. Meanwhile, Rob Simpson, former chief executive officer of the Ontario Problem Gambling Research Centre, estimates that even after all its benefits are tallied, a casino would suck $129 million a year out of the local economy.
Mark Bingeman, chief executive officer of the sports and recreation centre that bears his family’s name, has put forward a tempting proposal for a hotel and convention centre that could also include a casino. Yet even this more palatable idea from a respected business leader cannot convince us a casino should find a home in this region.
Premier Wynne is watching and listening. As leader of a minority government that could fall at any time, and with only one out of four provincial seats in this region held by the Liberals, she needs friends and is willing to do something to make them.
There are 11 votes on Kitchener council. On Monday, these votes should hammer 11 nails in the coffin of a local casino.
You have the opportunity — a vote on Monday to say yea or nay to a gaming establishment in your city. You have the best of reasons. It’s not worth betting the future of the vibrant and progressive community of Waterloo Region on such a risky venture. And now, it appears, you have the power.
In response to an avalanche of local political opposition, Ontario Premier Kathleen Wynne raised the stakes in the casino debate this week when she ordered the Ontario Lottery and Gaming Corporation to rethink its handling of the casino venture in Waterloo Region. In February this newspaper urged her to review a process that pitted governments and communities against each other. We are pleased that she is doing so.
Until now, developers seemingly had a green light to build a gaming establishment in Woolwich Township. That’s because Woolwich council voted in March to host a casino. According to the rules by which the gaming corporation had been playing, Woolwich’s decision meant a casino could open its doors in the township — regardless of what the rest of the region thought.
Had those rules held, there might have been an argument for Kitchener to put out its own welcome mat. After all, if a casino was coming to the region anyway, possibly just a few kilometres east of the city, why wouldn’t Kitchener accept one within its own boundaries? At least then it could claim a cut of the revenue — millions of dollars a year — that would compensate it for the social ills a gaming establishment would bring.
But the premier’s intervention changed this. Now there’s every reason to think that if Kitchener rejects a casino, the proposal will die — not just in the city but in the entire region.
Most local governments are already standing shoulder to shoulder against a casino. Cambridge, Waterloo and Wilmot Township all spurned the offer of one. In a gutsy move this week, Waterloo regional council voiced its moral opposition to a gaming establishment. If Kitchener lines up with these other governments, Woolwich will be the lone voice favouring a casino within this provincially designated gaming zone. And the tide of opposition could sweep the casino proposal from every table.
This newspaper does not oppose all gambling. When controlled and regulated by government, it is a legitimate form of recreation for adults. And Ontario has for many years allowed a limited number of casinos to operate in the province.
This newspaper is, however, alarmed by the provincial government’s policy of promoting a massive expansion of gambling, both in casinos and through online betting. The Ontario Lottery and Gaming Corporation’s stated goal is to increase its gambling revenues by $1 billion a year. New casinos are proposed for London, Woodstock, Hamilton and Toronto, as well as this region.
We all know gambling causes enormous pain and suffering. It bankrupts individuals. It tears families apart. Even casino advocates admit this. Dr. Liana Nolan, the region’s chief medical officer of health, estimates a casino would create 10,000 new moderate to severe problem gamblers in Waterloo Region, Guelph and Centre Wellington. “It’s better to prevent these problems by not having (a casino) in the first place,” she concludes.
Casino boosters might say the doctor is exaggerating. But why gamble that she’s wrong? Ontario should not increase its reliance on casinos to pay for the province’s schools and hospitals.
As for the business case, the jury of economists is out on whether casinos help or harm a local economy. Some small and economically depressed communities benefit from casinos, and Brantford is one that has. But Waterloo Region has one of the most dynamic economies in Canada.
Yes, a casino would create new jobs. Yes, it would attract visitors to the region — though its potential for boosting local tourism would be reduced if all the other proposed casinos open across the province. Meanwhile, Rob Simpson, former chief executive officer of the Ontario Problem Gambling Research Centre, estimates that even after all its benefits are tallied, a casino would suck $129 million a year out of the local economy.
Mark Bingeman, chief executive officer of the sports and recreation centre that bears his family’s name, has put forward a tempting proposal for a hotel and convention centre that could also include a casino. Yet even this more palatable idea from a respected business leader cannot convince us a casino should find a home in this region.
Premier Wynne is watching and listening. As leader of a minority government that could fall at any time, and with only one out of four provincial seats in this region held by the Liberals, she needs friends and is willing to do something to make them.
There are 11 votes on Kitchener council. On Monday, these votes should hammer 11 nails in the coffin of a local casino.
http://www.therecord.com/opinion/editorial/article/932446--keep-this-region-casino-free
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