Tag Archives: Edgewater Casino

Did Cabinet Seize Charity Money to Satisfy Casino Demands for Retractable Roof?

BC Place Roof
Photo of BC Place model, by Dustin Sacks from the Flickr Creative Commons

Mystery solved.

For two years the BC public and charities have wondered why the government took the stunning and inexplicable step of clawing back tens of millions from BC charities in one year alone, and seizing some $200 million more over 6 years.

But today it’s all clear. The BC government diverted hundreds of millions of dollars from charities and non-profits that we could have a retractable roof on BC Place Stadium instead of a dome replacement.

It’s clear from the timeline.

In the summer 2009 the BC Cabinet had a very serious problem. Their original $150 million estimate to build a retractable roof on the stadium was spinning out of control–in a single year it had more than doubled to $400 million and was growing rapidly.

Clearly, more responsible options had to be considered.

But the Las Vegas based Edgewater Casino owners, Liberal donors and insiders who hadn’t finalized their own deal with PavCo, wanted nothing to do with government fiscal responsibility. They wanted a retractable roof, and they played serious hardball to get it. Anything else was a deal-killer to them, and they made that crystal clear.

Where was the money to come from to satisfy the Edgewater Casino demands for an incredibly costly roof? Rich Coleman was the minister responsible for the BC Lottery Corporation, the casinos and also for gaming grants.

If the PavCo Edgewater deal was to survive, Rich Coleman had to be part of the solution.

This was the context in which Coleman moved in the summer of 2009 to claw back $36 million already committed to BC charities and cut them off from access to over $200 million over the next 6 years.

Today, more than two years later, as charities and non-profits across the province get ready to close, the roof opens on BC Place Stadium.

The Timeline

In May 2008, when the retractable roof was originally proposed, all-in costs were pegged at around $150 million. By November ’08 those projections had soared to $365 million.

In the spring and early summer of 2009 PavCo called for proposals to develop the BC Place lands. Paragon Gaming, the owners of Edgewater Casino and two other small market casinos in northern Alberta, submitted a bid to build a mega-casino complex onto the stadium. While that bid was under consideration, Paragon shareholder and board member T. Richard Turner, himself the former Chair of the BC Lottery Corporation, wrote a $50,000 cheque from his family company to the BC Liberal party for its May election campaign.

Mr. Turner had purchased shares in Paragon Gaming while still the Chair of BCLC, resigning from that board only months before Paragon’s purchase of the Edgewater Casino.

A month after the Liberal victory, Paragon was selected as the winning bidder, and began negotiations with PavCo to finalize terms.

But storm clouds were already forming. According to Kevin Krueger, the minister responsible, “it was very common knowledge that the bids to build the retractable roof had exceeded the estimate …fairly substantially. People knew… that (cabinet) would be wrestling with that question.”

Faced with a balking cabinet, Turner placed a call to Kevin Krueger’s private cell-phone, saying that Paragon considered its deal with PavCo “conditional upon a retractable roof,” and that failing to build one was a “deal-breaker”. The province had to call Turner’s bluff or find cash quickly.

In July 2009 Rich Coleman, minister responsible for social housing, BCLC and charitable gaming grants suddenly made what seemed then like an inexplicable move. Without warning he seized $36 million already committed to BC charities’ budgets from their legal entitlement to gaming proceeds.

With the stroke of a pen Coleman slashed grants to charities to pre-1995 levels, instantly securing just over $200 million from the charities’ gaming entitlement over 6 years.

Almost exactly the amount needed to meet Paragon’s demands for the retractable roof.

By fall 2009, events were moving quickly, but PavCo’s deal with Paragon was still not finalized. BCLC CEO Michael Graydon’s diary discloses that he brought Paragon VP Dennis Amerine before Treasury Board on October 1, 2009, where it appears yet more hardball was played.

On October 29, 2009 the province approved a budget for the BC Place roof, upgrades and temporary stadium of $575 million, almost 400% greater than the figure announced a mere 18 months earlier. PavCo went ahead with construction in May, 2010, without even waiting for Paragon to get their approvals.

We may never know why PavCo and Paragon were so confident that City Council would agree to a massive casino expansion, but gaming minister Rich Coleman’s dual responsibility for social housing may be a clue. Was there a tacit or explicit expectation that funds for social housing were linked to approvals for the Edgewater expansion? Is this why city staff’s initial public consultation only notified residents within 2 city blocks of BC Place? Why did almost no one in the city understand what was happening until a citizen’s group brought it to public attention? Why was this application so shrouded in mystery?

Whatever the true facts are, it is clear that charities and taxpayers are contributing hundreds of millions because of pressure from a casino partner that then failed to meet its own end of the bargain, and that .

The Fallout

Hundreds of BC charities and community groups across the province have quietly stopped serving their missions, or are near collapse. The Kelowna Women’s Resource Centre has closed, the Vancouver Children’s Festival is near failure, and the Museum of Vancouver and the Playhouse had to be bailed out by Vancouver taxpayers.

In the last 3 years BC charities have lost almost $100 million in gaming entitlements, destabilizing an entire employment sector responsible for 2.5% of the province’s GDP. Vital services freely available to the public, such as transportation of sick children to treatment, assistance for brain injury survivors, counseling for seniors and immigrants have been cut back or eliminated. There is no telling how many jobs have been lost, but they certainly number in the thousands. It goes without saying that entire system of charities and gaming demands a complete overhaul.

More prudent stewardship of the public purse would have saved those jobs and services and still got a perfectly good roof built for our teams.

Party insiders and cronies, backroom deals conflict of interest by those in positions of trust, the pushing around of small charitable organizations to get at their cash, and wild extravagance with the public’s money.

Dr. Fred Bass, MD, Former Vancouver City Councillor, opposes casino expansion

Address to Council by Dr. Fred Bass, Former Vancouver City Councillor, MD, DSc, Consultant in Preventive Medicine. Among his other distinctions Dr. Bass holds a graduate degree from the Harvard School of Public Health.

Mr Mayor and Council,

Thank you for the opportunity to speak.

My trade is that of epidemiologist and tobacco addiction specialist. Epidemiology is the study of the determinants of health and illness in populations. My training in this area was at Harvard and Johns Hopkins.

I am wearing an Alligator Hat today that was given to me by smokers who appreciated learning that what controls their smoking behavior was not their thinking brain but their primitive—amphibian, Alligator Brain—the same part of the brain that controls problem gambling.

One of you asked the first evening, “What proportion of gambling money is spent by problem gamblers?”

That was a brilliant question. As the movie said, “Follow the money!” The lottery folks pleaded ignorance in their response.

The central issue here is not:
“What proportion of people are problem gamblers?”
but
“What proportion of dollars gambled are problem dollars?”

I will use a Solicitor General’s report of March 2003 to answer that question.

In response to “How much do you spend on gambling in an average month?”, the survey respondents told us that
20% spend less than $1 a month
45% spend $1-$10 a month
22% spend $11-$49 a month
6% spend $50-$99 a month
3% spend $100 to $199 a month and another
3% spend $200 or more

With the modest assumption that the $200 or more group spend $300 per month, we can answer the question what proportion of $ gambled comes from what proportion of the population.

The answer is that a bit over 50% ($1350 of $2695) of the money gambled came from 6% of those who gambled, which is 4.5% of the total population.

Coincidentally, the prevalence of problem gambling that year (2002) was estimated to be 4.6% of the total population.

This study also found that casino gamblers had a significantly higher proportion of problem gamblers 8.8% instead of 4.6% overall average. That’s almost twice the average prevalence.
Casinos appear to attract and/or produce problem gamblers.

In this room 25 years ago, when I was advocating for smoke-free pubs and restaurants, many union employees in the hospitality industry appeared as delegations to argue that smoke-free by-laws would ruin their jobs and their lives. You have heard similar statements from many casino employees.

Some strong words now: Like the tobacco industry, the casino industry is a parasitic industry. Gambling is not sustainable: witness their return, asking for gambling expansion just five years after their previous injection of a casino.

I believe the public, for the most part, has intuitively recognized that expanding slots from 600 to 1500 and gaming tables from 75 to 150 would not be good for this city.

My advice for those seeking re-election this fall is to reject expansion of the casino.

Respectfully,

Frederic Bass, MD, DSc

Mani Amar: A Reckless Proposal & Profiteering For Criminals

A Reckless Proposal & Profiteering For Criminals
By Mani Amar

The amount of gang activity that occurs in Vancouver, our small but beautiful major city, rivals massive metropolitan areas across North America. Los Angeles, Las Vegas, New York, & Chicago are well known throughout the world for gang activity, but another city has taken precedence on this list. Our city.

Vancouver generates billions of tax free dollars through its marijuana trade industry every year. Vancouver is geographically destined to be a major drug distribution hub. But instead of using resources to tackle such a drug issue, we are providing criminals with another reason to operate. Gambling.

Gambling, along with prohibited narcotics, alcohol, and prostitution have been historically the favourite industries for gangs to operate within. Gambling has an ominous aura; it attracts addictive personality peoples, it attracts organized crime, and it attracts violence. Gambling generates other dangerous criminal industries such as loan sharking and money laundering.

For a city that has been ravaged by violent crimes, a city with a drug industry with worldwide distribution, and a city with law enforcement resources stretched very thin, to even consider a mega casino expansion in a central location of the city is not only reckless, but simply stupid.

The very notion of PavCo bringing this proposal to Vancouver is based solely on greed. They do not care for our city, they do not care for our safety. They simply care about their own financial gain.

They bombard us with statistics of money, telling us that Vancouver will profit dearly from tax dollars and job creation. But they neglect to mention that lives will be damaged, government resources will be stretched further, our valuable tax dollars and the valuable tax dollars of our future generations will be used to salvage the socioeconomic downturn of our once beautiful, and more importantly, safe city.

I urge the council to consider the negative effects of this casino expansion. Consider all that will be lost, for this generation and our future.

This is nothing more than a reckless proposal and opportunity of profiteering for criminals. This is simply a situation where the cons outweigh the pros.

Peter Busby, Architect, Order of Canada, and former Vancouver planner Penny Gurstein, oppose Vancouver casino

.

Peter Busby and Penny Gurstein have co-signed an op ed opposing the Edgewater mega-casino development. Peter Busby, Order of Canada, is a world-renowned architect and is Founder and Chair, Canada Green Building Council. Penny Gurstein is Professor and Director of the School of Community and Regional Planning and the Centre for Human Settlements at UBC.

Below their op ed, you will also find Peter’s notes detailing some of the environmental, architectural, urban planning and economic problems with the casino plan.

Insular megacasino would add no value to Vancouver’s downtown businesses

Also printed in the Vancouver Observer.

On April 9 and 10th, 2011, Vancouver City Council is holding rare weekend public consultations on the controversial proposed megacasino project adjacent to BC Place.

Council’s ultimate decision on the project will test the fundamental values Vancouver has worked hard to achieve and will set forth a vision for the city’s future.

Vancouver has made great strides distinguishing itself from most large North American urban centres. It’s a city where urban-planning techniques and architectural styles are based on the core values of sustainable, economic, social and ecological development. Vancouverites see these values reflected in the growing collection of innovative green architecture, vibrant neighbourhoods, transit options, green space and lack of highways bisecting the city.

The proposal by Crown-owned BC Pavilion Corporation (PavCo) and Las-Vegas-based Paragon to build this mega-casino, boasting a gambling floor the size of two NFL football fields and 1500 slots, does not reflect a city renowned for its lifestyle, natural beauty and diverse cultural integration.

The presence of this megacasino in the downtown core threatens to undermine Vancouver’s values while running contrary to the vision of a municipality that aspires to be the greenest city in the world in less than a decade.

Continue reading

When casinos roll into the red, by Glen Korstrom

When casinos roll into the red

Restructuring Gateway Casinos and Entertainment wiped out $1 billion in debt and provided the company with a $100 million capital infusion and a $500 million loan

By Glen Korstrom, Business in Vancouver magazine, April 5-11, 2011; issue 1119

Activists who oppose Paragon Gaming Inc.’s proposal to build Western Canada’s largest casino adjacent to BC Place frequently say their opposition stems from fear that the venture will collapse in debt.

They justify these fears by pointing to a jackpot of casino companies that have run into debt so deep massive restructuring was required. One of those deals was the largest acquisition of 2010 that did not involve a mining company.

As for Las Vegas-based Paragon, it has an option to lease taxpayer-owned land, subject to civic approval and $350 million in financing, so it can build a $450 million casino and hotel complex by 2013.

Its $6 million annual lease payments would help BC Pavilion Corp. (PavCo) pay for the $563 million renovation of BC Place.

Paragon president Scott Menke has refused to open his private company’s books to demonstrate fiscal strength. PavCo chairman David Podmore, however, told Business in Vancouver that he has seen Paragon’s books and that he believes the company is capable of meeting financial commitments.

Things don’t always work out so well for casino operators, however.

The largest non-mining acquisition of 2010 demonstrated that.

Burnaby’s Gateway Casinos and Entertainment Ltd. morphed from being an income fund in 2007 to being owned by two shareholders: Crown and Macquarie Bank.

Continue reading

How Vancouverites feel about gambling expansion: the real numbers


Graphic above is from the Justason report (see below)

67% of Vancouverites believe casino expansion will bring significant social problems.

Once again, consistent with all other polls of the Vancouver public, the Ipsos poll released March 24 shows a clear and substantial majority of decided respondents OPPOSE the expansion of Edgewater Casino. Although the margin of error was large and the sample size was very small at 250 Vancouver residents, this is the third poll since February demonstrating a clear lead by expansion opponents over supporters. No poll of Vancouver residents has ever shown public support for the casino expansion, and no poll has shown support within 10 percentage points of opposition.

Below is a summary of the polling data we are aware of. Please note that the figures below reflect DECIDED respondents.  We have allocated undecideds proportionately, so the numbers are different from what you will see on the survey results themselves:

Robbins Sce Research March 14, 2011:
Oppose casino expansion:  58.5%
Support expansion:  41.5%
= 17% gap  in our favour
Margin of error: 4.37% 19 times out of 20 @ 95% confidence
Sample size 503 Vancouver registered voters who voted in the last election.
Phone poll: Vancouver City poll – Casino, Legal Aid, BC Place Roof, Citizens Initiative and Recall, Party popularity 

Justason Market Intelligence  February, 2011
Oppose expansion: 62.5%
Support expansion:  37.5%
= 25% gap in our favour
Margin of error 4.9% 19 times out of 20
Sample size of 662 Vancouver residents.
See the phone and online poll (note: pdf) 

Blue Thorn Research and Analysis Group Report, commissioned by the Province of British Columbia  July, 2007
Here is a 196 page study commissioned by the Gaming Policy and Enforcement Branch from 2007, reviewing impact and social acceptance of gambling and casinos in 4 metro Vancouver municipalities, including Vancouver:    http://www.pssg.gov.bc.ca/gaming/reports/docs/rpt-rg-impact-study-final.pdf (pdf)
Harm of gambling outweighs benefit:   63.9%
Edgewater is beneficial to community:  15.1%
Page 7 of the report (Executive Summary), or on the pdf p. 11/196:   Sample size was 1000, and INCLUDED THE OPTION OF CANTONESE, MANDARIN, OR PUNJABI RESPONSES.  This survey was weighted to balance for age, gender, and ethnicity. 

From the Executive Summary:

Vancouver has the most negative attitude toward gambling of the four communities. Their negative general attitude toward gambling has significantly increased. In 2004, 56.6% of people believed the harm of gambling outweighed benefits, increasing to 57.4% in 2005, and 63.9% in 2006. The community’s negative attitude toward the Edgewater Casino also became significantly worse. In 2004 only 26.0% believed it was likely to be somewhat or very beneficial to the community. This decreased to 24.4% in 2005 and only 15.1% in 2006.

Nathan Edelson, Former Vancouver City Planner-Presentation to Council

Presentation to City Council Opposing Casino
Nathan Edelson
March 14, 2011

As some of you may recall, I am a former Vancouver City Planner.

Like former Councillors Ladner, Puil and Ford, I am not from Las Vegas; and I don’t support the proposed casino. I am also proud to be on the same side on this issue as many others with others with whom I have worked including Tom Durrie, Herb Barbolet and John Shayler as well as the Community Arts Council of Vancouver, on whose board I serve.

My reasons are simple:
1. The process doesn’t smell right
2. The stadium roof leaks money and doesn’t look right
3. Enabling addiction to gambling as a public policy doesn’t feel right

Process
Regarding the process, the media has reported that a number of former and current public officials have been working behind the scenes or, in some cases, directly for the casino and associated facilities. Whatever their past contributions to public service – and they are considerable – I believe those who have argued that these facilities should be public priorities may have lost their way. Some have strayed so far along the path toward conflict of interest that it is unclear as to whether they have broken the law or whether the law must be fixed.

• The design of the complex is too large and will further block rather than enhance the important linkages between the Downtown Eastside, including Chinatown, and False Creek.
• The stadium roof now litters our skyline – its design is disrespectful of 3 decades of careful work to protect public views
• The stadium and the roof cost more than $560M. That these funds were spent in advance of this public hearing is disrespectful of the City’s rezoning process.
• More importantly, this is a misallocation of public funds when:

– Hundreds of homeless live on our streets
–Thousands of our children are unsafe in schools that need seismic upgrading; and
–Tim Bits are served in the emergency rooms of our hospitals

The TEAM Council on which Marguerite Ford served in the 1970’s achieved greatness.
1. It had a clear vision of a city made up of liveable, inclusive and engaged communities.
2. It also had the courage to say NO to the freeways that many experts declared were both necessary and inevitable.

The result is what is recognized as one of the most liveable cities in the world, at least for most, if not all of us.

Should you decide that you have to approve this proposal, be careful to check every detail of the permits. I helped negotiate a Community Benefit Agreement with the original owners of Edgewater so that inner city residents would be given at least 10% of the new jobs.

Many of these were contracted through Cook Studio – a social enterprise that trained low income youth. It was contracted to do offsite catering and to operate the onsite restaurant. When Paragon took over ownership of Edgewater, they cancelled the contract. This contributed to Cook Studio going bankrupt and the loss of opportunity for dozens of young people who were taking their first steps out of poverty.

I think it is important for all of us to recognize that Edgewater has been a good employer. This is why so many of its workers have taken the time to speak on behalf of the company and the pride they have in their jobs.

However, I would ask you to question Paragon as to why so many of its current workers fear that unless the casino is expanded, they may lose their jobs. If the Casino – at its current size is relocated or the license is transferred to another company, Council can help protect their jobs as a condition of development or other permissions.

More than a decade ago, Mayor Philip Owen had to wisdom to understand that addiction to illegal drugs is a public health issue. It is time for us to understand that this is also true of Addiction to Gambling.

I would suggest a Four Pillar approach to reduce government’s Addiction to Gambling.

1. The first pillar is Prevention
On one side of the chips, show the high proportion of revenue that comes from the poor;
On the other side, show where the revenues actually go; and
On the large screens show the people driven into bankruptcy, their foreclosures, divorces and innocent children.
2. The second Pillar is Harm Reduction
Develop a policy of no increase in slot machines and tables; and
Gradually eliminate highly addictive internet gambling
3. Treatment is the third pillar
Create a fair taxation policy – so that governments have the resources to provide needed public services without relying on the proceeds of gambling.
4. The fourth pillar is Enforcement
•  Work with the Province to carry out a full public inquiry into all the events that led to the proposal before you this evening. This should include the circumstances under which Paragon took over ownership of Edgewater, the proposal for more than tripling the size of the casino, the public expenditures on stadium and the public engagement process.
•  Whether or not the inquiry reveals illegal activity has taken place, it should check to make sure that the laws regulating conflict of interest are clear and adequately reflect the public’s sense of right and wrong.
•  This will help public officials – both current and former – “To know their limit; and to stay within it.”

In my view, and those of many who have spoken and will speak before you, we need to recognize that the casino is like a freeway – a Social Freeway to Nowhere. Like the TEAM Council of the 1970’s, you have an opportunity to turn this proposal down and to have staff complete much needed planning for this area.

Finally, I think it is important that the roof – the roof that would be retractable – remain for decades to come.

Like the Georgia Viaduct before it, it should serve as a symbol for the path we chose not to take. A reminder that in the early part of this century – with all of its challenges – that Vancouver’s City Council chose to work with the senior governments to house our homeless, protect the lives of our children and become the Greenest, and the most liveable place on earth – not for most of us; but for all of us.

Unified in Action – Vancouver churches oppose casino expansion

The following is an historic letter from major downtown Vancouver churches in opposition to the expansion of the Edgewater Casino. The churches are St. Andrew’s Wesley, Central Presbyterian Church, Christ Church Cathedral, First Baptist Church, and St. Paul’s Anglican Church:

Unified in Action

Clergy and Staff from Downtown Vancouver Churches

Mayor and Council
City of Vancouver

March 9, 2011

Re: Mega-Casino Opposition
Dear Mayor Robertson and City Council:

The undersigned, clergy and staff from major downtown Vancouver churches have agreed, personally and collectively, to stand in opposition to the proposed expansion of The Edgewater Casino in The Yaletown-False Creek area.

We are particularly concerned that the people of Vancouver have not been adequately consulted on the subject of gambling expansion in the city, and we are especially concerned that those who work and reside in the Vancouver downtown core have not been adequately informed of the plans to redefine life in the downtown area through the construction of this mega-casino.

We do not support the enormous expansion of the Edgewater Casino and its proximity to the soon-to-be-reopened BC Place Stadium, particularly when it is proposed to become the centrepiece of a large “entertainment complex” complete with hotels, restaurants, and other facilities.

Well documented social ills which accompany any and all casino developments are more than sufficient reasons for us to oppose this planned development. Our resistance is magnified even further when we see the scale of the casino that is proposed to be located in the heart of downtown!

We call on Vancouver Mayor and City Council to impose a moratorium on all gaming expansion in our municipality pending a full and comprehensive public review of gambling, its regulation, and the appropriate gaming revenue-sharing formula with municipalities and non-profit organizations.

From: St. Andrew’s-Wesley United Church
Rev. Gary Paterson, Senior Minister
Jennifer Cunnings, Minister of Children, Families and Seniors
Tim Scorer, Minister of Adult Formation
Michael Dobbin, Director of Development

From: Central Presbyterian Church
Rev. Jim Smith, Minister

From: Christ Church Cathedral
The Very Reverend Dr. Peter Elliott, Dean,
The Venerable Dr. Ellen Clark-King, Associate
The Reverend Alisdair Smith, Deacon
The Reverend Chris Dierkes, Curate,
The Reverend Dixie Black, Deacon

From: First Baptist Church
Rev. Darrell W. Johnson, Senior Minister
Rev. Dr. John Cuddeford, Minister
Andrea Tisher, Dir. of Music & Worship
Rev. Bob Swann, Minister of Mission & Justice
Judy Lang, Ass. Minister for Congregational Care
Pastor Janet G. Porcino, Minister of Discipleship
Luz Figueroa, Director of Children and Family Ministries
Rev. Abraham Han, Minister of Urban & Community Life

From: St. Paul’s Anglican Church
The Rev. Markus Duenzkofer, Incumbent


 

Facts – History of the casino issue at City Hall

These are the facts: Whatever Premier Campbell has said, whatever PavCo has said, an expanded casino at B.C. Place stadium has never been discussed or approved by Vancouver City Council.

The current City Council agreed on Oct. 22, 2009 that a casino was an approved use at B.C. Place (there’s already one across the street). BUT nowhere in the Oct. 22/09 policy statement was there any discussion about an expanded casino. The size of the casino was never debated.

The staff recommendation to amend the False Creek North Official Development Plan, approved at a Sept. 16, 2008 council meeting, made no mention of an expanded casino. Nor does the word “casino” appear anywhere in the minutes of the Sept. 16 meeting, or in the minutes of an Oct. 18 public hearing following it.

At the Oct. 18, 2008 meeting, in the heat of an election campaign, Council unanimously approved allowing “city- and region-serving cultural, recreational and institutional uses including consideration of the Vancouver Art Gallery as a use, generally as set out in Appendix A.”

Only in Appendix A do the words “expanded casino” appear, without any reference to the major policy change this entails, or definition of “expanded casino” or further discussion of this major change in city policy. The words in the appendix are: “Council may allow sub-area zonings to include other cultural and recreational facilities, including a major art gallery and a major casino that will also serve the city and region.”

Those zonings would have to be referred to a public hearing before becoming policy.

This in no way constitutes council approval for an expanded casino.

Deloitte Report on the Edgewater mega-casino

Please feel free to peruse Deloitte’s Economic Report – Entertainment Complex for yourself. Please note that the report states that its projection figures were derived from Paragon Gaming itself. These figures do not appear to have been independently assessed. We welcome any and all expert opinion on this report – either comment below or send us an email.