MLA Casino Review

MLA Casino Review

On Oct. 12, 2010, the Government of Alberta released the long-awaited public report of the MLA Advisory Committee to Review Eligible Organizations' Access to and Distribution of Proceeds from Licensed Casino Events. In a press release issued by the Alberta Gaming and Liquor Commission, the government says there will be no changes to the AGLC policies around the charitable gaming model. The 86-page report by the MLA Advisory Committee was submitted to Frank Oberle, the minister responsible for the AGLC, in March 2010. This review looked at charitable gaming policies for wait times, distribution of proceeds and volunteer requirements. Oberle, Solicitor General and Minister of Public Security, said the complex issues outlined in the report require more analysis and research and he has referred the report to AGLC for further research.

"The MLA Advisory Committee had a daunting task to find solutions to these issues. We are pleased with the Committee's recommendations in support of the current charitable gaming model and the concern about the impact of potential changes on both rural and urban charities," said Katherine van Kooy, President and CEO of the Calgary Chamber of Voluntary Organizations

Media Coverage:

  • Editorial published in the Calgary Herald on October 14, 2010.
  • News article from the Edmonton Journal, October 14.

 

Backgound

In 2009, the Alberta government appointed a three member MLA Committee to review the Province’s Charitable Gaming Model and make recommendations on how to improve wait times and the pooling of proceeds from licensed casino events to eligible charitable groups. The committee was also tasked with reviewing the number of volunteers needed to conduct and manage charitable casino events.

The Committee has completed its work and submitted a report to the Provincial Government. The Government is in the process of reviewing the report and we are awaiting their response. The results of this review are of interest for many organizations as casino revenues are often a stable, predictable, and flexible source of revenue.

Some of the changes under consideration would result in reduced casino revenue for charities in what are defined as urban areas, i.e. Calgary and Edmonton. In light of this, CCVO provided input to the MLA Advisory Committee in the form of a written submission, as many of our members will be affected by any changes made to current policies and procedures.

 

Aspects That Were Reviewed

Distribution of Proceeds

  • The consultation questions from the government ask whether pooling should continue to be applied on a regional and quarterly basis (see below), and ask if there are suggestions for better alternatives.
  • There is a significant difference in proceeds to charities from rural and urban casinos, with a current range of $18,325 to $76,109.
  • Various lobby efforts have been made in the past several years to institute some sort of province-wide pooling. These efforts include resolutions presented to the Alberta Conservative Convention (2008), the Alberta Urban Municipalities Association (AUMA), and the Alberta Association of Municipal Districts and Counties (AMD&C). There have also been discussions at the Standing Committee on Public Safety and Services, and motions (non-government) made in the provincial Legislature.
  • Advocates for change argue that casino proceeds should be shared more equitably among charities, with the idea that equity means identical per-capita proceeds across the province.
  • Currently casino proceeds (table revenues and slot machine revenues) are pooled quarterly within the same region. These pooled proceeds are equally divided among all organizations that supported a casino during that quarter and in that region. This process ensures that organizations within the same region receive comparable revenues, in spite of variations between individual casino facilities and between weekday & weekend proceeds.
  • Allocation of table revenues varies from region to region; however slot machine proceeds are distributed in a standard manner: 15% to the charity; 15% to the operator; 70% to the Alberta government (Alberta Lottery Fund).
  • One position that has been promoted is to move to provincial pooling of slot machine revenues only. However, it should be noted that slot machine revenues are growing and have substantially outpaced table revenues.
  • Considerations/Implications
    • Calgary organizations have seen an average decline of $30,000 revenue per casino event since 2007 (3rd quarter).
    • Any reallocation of casino revenues would further aggravate funding issues and create increased hardship on urban charities.
    • The challenge of replacement of any lost income from this source is compounded by the substantial decline in other provincial funding programs.

Wait Time

  • The consultation questions from the government ask whether current boundaries should be moved and how, whether rural charities should have access to Edmonton and Calgary casinos, and ask for suggestions for better alternatives.
  • The difference between waiting periods for rural charities and urban charities has been discussed for a number of years.
  • Currently the range in wait times is 16 months to 33 months (the longest wait time was up to 40 months a couple of years ago).
  • The principle that Alberta Gaming and Liquor Commission (AGLC) currently applies to this issue is that casino proceeds should be distributed to the community in which they were raised. In addition AGLC acknowledges that charities in Edmonton and Calgary often support a larger client base, including provincial charities. See Consultation Questions
  • Proposals have been circulating for a number of years to modify or eliminate the current boundaries so that rural charities are eligible to apply for casinos in Calgary and Edmonton. These proposals suggest that the boundaries are arbitrary and cite issues of fairness and equity – particularly that rural charities should have equal access to casinos, meaning experience the same wait times as urban charities.
  • Considerations/Implications
    • Any of the proposed changes in boundaries or wait times would have the effect of reducing payouts to existing organizations in the urban areas

Volunteers

  • The consultation questions from government ask whether the volunteer requirements should be decreased or maintained, and ask for suggestions for better alternatives.
  • Some charities have expressed concern to their MLAs about the number of volunteers that are needed to support their casino event.
  • Casino operators have also been advocating for a change in the system, recommending a move to fully staffed casinos with minimal involvement of charitable organizations, as a more efficient way of operating casinos.
  • A recent Volunteer Calgary poll found that:
    • Over 70% of respondents do not find the casino volunteer requirements excessive
    • Over 90% of respondents would not want the government to modify the system to reduce the volunteer requirement if proceeds would be decreased
  • Considerations/Implications
    • Any substantial changes to the volunteer model represent a fundamental shift in Alberta’s Charitable Gaming Model. If casinos were fully staffed, there would be no sound rationale for charities to receive revenue from specific casinos.
    • Potential outcomes could be province-wide pooling of proceeds, or the replacement of the license model with a grant program.
    • A grant program could require more complex applications and increased administrative burden, different eligibility criteria, and could provide less flexibility in allocation of monies, potentially ruling out allocation to operating expenses.

Resources

The Alberta Gaming and Liquor Control (AGLC) Website