Canadian Gaming Business June/July 2007

Canada's Premier Gaming Industry Magazine

Vol. 1 No. 6

June/July 2007

First Nations Gaming Photo courtesy of Ontario Tourism/J. Speed

Still Growing after 11 Years

Inside: Lottery and Gaming Executive ‘Town Hall’ Ontario Bingo Reform WTO Internet Gambling Dispute April 29 - May 1, 2008 - please visit www.canadiangamingsummit.com for details

June/July 2007

Volume 1 Number 6

Publisher

Chuck Nervick

chuckn@mediaedge.ca 416-512-8186 ext. 227

Editor

Fred Faust

ffjr@swbell.net

Advertising Sales

Philip Soltys

philips@mediaedge.ca

Senior Designer

Annette Carlucci

annettec@mediaedge.ca

Designer

Ian Clarke

ianc@mediaedge.ca

Circulation Manager

Julie Shreve

julies@mediaedge.ca

contents 5

Editor’s Note

6

E-MAILS TO THE EDITOR, CORRECTIONS/CLARIFICATIONS

7

MESSAGE FROM CGA

8

Gaming News Roundup

Data on the Canadian gaming market tells some interesting stories, Alexander First Nation is not going ahead with plans to host online gaming sites, the University of Alberta’s artificial intelligence whizzes prepare for a poker showdown, and other gaming news.

14

LOTTERY AND GAMING EXECUTIVE ‘TOWN HALL’

A t the final session of the Canadian Gaming Summit, executives from five provincial lottery and gaming corporations discuss everything from duty of care to Internet gambling.

20

gaming personality – GORDON MACKAY, MACKAY | WONG STRATEGIC DESIGN

Proudly owned and published by:

President Kevin Brown

President & CEO Bill Rutsey

kevinb@mediaedge.ca

wrutsey@canadiangaming.ca

Vice President, Strategic Development Chuck Nervick

Vice President, Public Affairs Paul Burns

chuckn@mediaedge.ca

pburns@canadiangaming.ca

Canadian Gaming Business is published six times a year as a joint venture between MediaEdge Communications and The Canadian Gaming Association For advertising information, Contact Chuck Nervick 416-512-8186 ext. 227 chuckn@mediaedge.ca

For editorial information, Contact Fred Faust 866-216-0860 ext. 271 fredf@mediaedge.ca

Copyright 2007 Canada Post Canadian Publications Mail Sales Product Agreement No. 40063056 ISSN 1911-2378 Guest editorials or columns do not necessarily reflect the opinion of Canadian Gaming Business magazine's advisory board or staff. No part of this issue may be reproduced by any mechanical, photographic or electronic process without written permission by the publisher. Subscription rates: Canada $44.94 per year, $80.79 two years. All rates are payable in Canadian Funds only.

Postmaster send address changes to: Canadian Gaming Business Magazine 5255 Yonge Street, Suite 1000, Toronto, Ontario M2N 6P4

22

OMBUDSMAN REPORT ON B.C. LOTTERY

The Ombudsman was “surprised at how much dysfunction there was in the system.”

24

FIRST NATIONS GAMING – STILL GROWING AFTER 11 YEARS

34

ONTARIO BINGO REFORM: NEW REVENUE SPLIT, MORE GAME FLEXIBILITY

36

FACILITY FOCUS – CASINO OF THE ROCKIES

38

WTO INTERNET GAMBLING DISPUTE HEATS UP

F irst Nations, and nearby communities, benefit as growth continues, mainly in Saskatchewan and Alberta.

Major changes went into effect May 1, and stakeholders agree that all parties should benefit.

After losing the final round of its fight with Antigua, the U.S. takes the unprecedented step of amending its original treaty terms.

41

CHEF SPOTLIGHT – RALPH DEDA, MCPHILLIPS STREET STATION CASINO

44

lottery and gaming corporation highlights

The latest news from British Columbia, Alberta, Saskatchewan and Manitoba.

Volume 1 No. 6

Canada's Premier Gaming Industry Magazine

Vol. 1 No. 6

June 2007

First Nations Gaming

Official Publication of the Canadian Gaming Summit

Photo courtesy of Ontario Tourism/ J. Speed

Still Growing after 11 Years

Inside: Lottery and Gaming Executive ‘Town Hall’ Ontario Bingo Reform WTO Internet Gambling Dispute April 29 - May 1, 2008 - please visit www.canadiangamingsummit.com for details

Canadian Gaming magazine June 201 1

6/18/07 3:16:39 PM

On the Cover No First Nations casino is likely to top the revenue of Casino Rama, but the numbers, scope and influence of these facilities are growing.

Canadian Gaming Business |

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editor'snote

Editorial Advisory Board Howard Blank, Vice President Media & Entertainment / Marketing & Promotions, Great Canadian Gaming Corporation Lynn Cassidy, Executive Director Ontario Charitable Gaming Association Robin Drummond, Senior Director Spielo, GTECH Nick Eaves, Vice-President Woodbine Entertainment Group

First Nations Gaming, and Provincial Lottery Executives Speak Candidly

Art Frank, President Niagara Casinos Brian Fraser, Marketing Manager IGT Canada Jordan Gnat, President & Chief Executive Officer Boardwalk Gaming Muriel Grimble, Executive Director Gaming Products & Services Alberta Gaming & Liquor Commission Lyle Hall, Managing Director HLT Advisory Inc. Zane Hansen, President & Chief Executive Officer Saskatchewan Indian Gaming Authority Brad Johnson, Vice President Marketing Aristocrat Technologies Inc. Ron Kelly, Executive Vice President Arrow Games Michael Lipton, Q.C., President, International Masters of Gaming Law and Partner, Elkind & Lipton LLP Eric Luke Eric R. Luke and Associates Alan Lyman, Senior Regional Director Scientific Games Margaret McGee, Vice-President of Prevention Programming and Public Affairs Nova Scotia Gaming Corporation Jovica Perovic, Director Casino Product Development & Facilities British Columbia Lottery Corporation Michael Randall, Vice President Corporate Responsibility & Communications Atlantic Lottery Corporation George Sweny, Senior Vice President Lotteries OLG Monique Wilberg, Chief Operating Officer Gateway Casinos

For the editor of a publication like this one, a good trade show and conference offers a mother lode of material to write about, as well as inspiration for future stories. The Canadian Gaming Summit in Toronto in April did not disappoint. Most of the conference sessions that I attended were even better than advertised in the program.

Topics and speakers were well-chosen.

Several sessions at the Summit informed Albert Warson’s report on the growth in First Nations gaming – how far it’s come in 11 years, how it’s benefited many First Nations and where the future growth will occur (see page 24).

Our Facility Focus in this issue also happens to be about a First Nations business, the St. Eugene Mission Resort and its Casino of the Rockies. This is the only First Nations casino in British Columbia, and as Lisa Kopochinski explains (see page 36), the site has an interesting but sad history.

As with the 2006 Summit, the final session this year consisted of executives from the provincial lottery and gaming corporations discussing – guided by questions from Bill Rutsey of the CGA – the state and future of the industry. We run a transcript from that session, edited for space reasons of course (see page 14). I think you’ll be surprised by some of the comments. One would expect a discussion of responsible gaming

imperatives, and the problems in public perceptions of our industry. But take a look at the comments about Internet gaming, sports betting and government ownership and operation of gaming.

We’ll have more coverage of Summit sessions in our August issue.

If you have an interest in Internet gaming but have lost track of the dispute over it at the World Trade Organization – or maybe never read about it in the first place – you can be forgiven. Antigua’s fight with the U.S. over access to Antigua’s online gaming operators is more than four years old. It’s had a lot of twists and turns, and the WTO rulings, with their legalistic language and extremely bureaucratic style, do not make for light reading. The nuances of international treaty and trade law are numerous, and difficult for non-specialists.

But Christine Mingie does a great job of explaining where the case stands today, and how the parties got to this point. Her story on page 38 is your opportunity to get a handle on this issue in one easy-to-read piece.

Fred Faust Editor fredf@mediaedge.ca 866-216-0860 ext. 271

E-mails to the Editor Policy Canadian Gaming Business welcomes e-mails to the editor. E-mails should include the name of the sender, business or professional affiliation, and city and province of the sender’s office or home. A phone number should be included for contact purposes; the phone number will not be published. We reserve the right to edit e-mails for purposes of brevity and clarity.

Canadian Gaming Business |

E-mails to the Editor

‘Understanding Cultural Differences’ – A Misunderstanding?

The following letter was addressed to Bill Rutsey, president and CEO of the Canadian Gaming Association.

“You can’t win from behind” was Rutsey’s Message from CGA that appeared in the cited issue. Rutsey’s reply follows this letter.

Dear Sir: In reading your magazine (Vol. 1, No. 3) for December 2006/January 2007, I was very pleased and impressed by your article “You can’t win from behind.”

The Corporate Social Responsibility message which you conveyed and the importance you have personally attached to it is to be commended.

I find it very revealing when, in the same edition, I read your article “Understanding Cultural Differences.” The focus of this article was how to capitalize on the superstitions or myths arising out of various cultures. As stated in the article, cultural differences cause a vast array of behaviours and preferences.

What I find disturbing in all of this is the hypocrisy of you and your editorial staff. On the one hand you state that the Canadian gaming industry must demonstrate leadership in addressing the issues of responsible gaming and responding effectively to problem gambling concerns. You then go on to promote taking advantage of superstitions and myths in promoting gaming venues.

Are you behaving in a fashion which supports Corporate Social Responsibility? My participation on a responsible gaming committee in the province of Alberta and knowledge of the issues surrounding problem gambling tells me you are not. Responsible gaming committees across Canada are attempting to dispel the myths associated with gambling while your magazine is “selling” ideas on how to take advantage of these myths and superstitions.

To quote your article, “We must come together to build a consistent and responsible national CSR message, which clearly demonstrates leadership taken on the issue.” Your magazine clearly missed an opportunity to show leadership on this key and controversial issue.

Dear W.D. Winterton: After reading your letter I carefully re-read the article you criticize, “Understanding Cultural Differences,” and then read your letter again.

I am at a loss as to what it is that you object to or find hypocritical.

What’s wrong with market research, understanding your customers and providing your products and services in a way that they (customers) find attractive? This is Basic Business 101.

You seem to have fallen into the trap of confusing similar terms.

Informing players about the truths and myths about gambling (that slots get “hot” and “cold,” that a pretty girl blowing on dice guarantees a winning roll, that a slot is “due” to pay off, etc.) that you reference are all part of responsible gaming policies and practices that everyone in the industry agrees with. Nowhere in the article is it suggested that this not be done, or that vulnerable people be taken advantage of.

What the article is about is understanding what your customers like and don’t like, and designing facilities taking this into account – such as the example of redesigning the entrance to the MGM Grand in order to be sensitive to the cultural superstitions of that casino’s clients. Asians just didn’t want to enter through the mouth of a lion. What’s wrong with understanding and accommodating that? It’s just good business.

There is no suggestion in the article that facilities should be designed or marketing approaches developed to target people with problems – that’s just not right.

Thank you for taking the time to write, and I hope you’ll re-read the article in question and understand what it does and does not say.

W.D. Winterton General Manager Fort Road Bingo Association Edmonton, Alberta

Bill Rutsey President and CEO Canadian Gaming Association

Corrections/Clarifications We apologize for an error in our April story “What’s New in Security and Surveillance.” In describing products from iView Systems, we confused the features of the company’s iPass Visitor Management System with those of its iGWatch System, which uses facial recognition software to help identify people on the casino floor who are not supposed to be there. The iPass system has nothing to do with facial recognition software. iPass, introduced in 2006, is a visitor management system to register, create badges and manage visitors, for example in an office or factory environment. It maintains a real-time and historical list of current and pending authorized visitors.

The OLG made a mistake in its submission to our Lottery and Gaming Corporation Highlights in the April issue. Neros Steakhouse, which opens in June at Casino Windsor, will seat 184 customers, not 1,800.

| June/July 2007

messagefromCGA

Confidence in Canadian Lotteries

By Bill Rutsey, President and CEO of the Canadian Gaming Association

The Canadian lottery system has been a successful partnership among government, retailers and the public for almost a quarter of a century, generating thousands of jobs, significant economic returns, and tens of billions of dollars for health care and education. At the core of any lottery game, of course, is the absolute requirement that everyone has an equal chance to win, and that players are not deprived of their legitimate winnings by nefarious means.

By now, we’ve all heard or read the stories about the statistical increased incidence of wins by “insiders,” meaning lottery retailers and their several hundreds of thousands of employees, across the country.

Playing the lottery is the most popular form of gaming in Canada, with more than 2 billion individual transactions and almost 200 million winning tickets paying prizes of approximately $2 billion annually. To put the issue in some context, what we are talking about in Ontario, as an example, are five suspicious transactions out of approximately 90 million winning tickets. That said, one stolen ticket is one too many.

The Ontario and B.C. Lottery corporations have each been the subject of an Ombudsman’s review on the matter, and a complete review of all lottery activities was recently announced in Atlantic Canada.

In B.C, the province’s Ombudsman has quite properly pointed out that “… confidence in the lottery system is important: to the people who play; to the causes that benefit from the distribution of lottery funds; and to the vendors who sell the tickets.”

Confidence in the lottery system is extremely important to the entire Canadian gaming industry, and it is an issue taken very seriously by all concerned across the country. The President and CEO of the Nova Scotia Gaming Corp. has called the retailer wins issue a serious wake-up call for the entire gaming industry worldwide.

In Atlantic Canada, the ALC Board of Directors commissioned a forensic audit by KPMG, and subsequently announced a series of major changes to better protect lottery ticket customers and their winnings. In Ontario the government has committed to

implementing the Ombudsman’s recommendations “… to make Ontario’s lottery system the gold standard in the industry.”

Similarly, in British Columbia, the government has accepted all of the Ombudsman’s recommendations and has ordered an “independent and comprehensive” audit of BCLC’s retail lottery system and the government’s Gaming Policy and Enforcement Branch (GPEB). The B.C. Solicitor General is on record as saying: "Clearly we have a serious report with serious observations … we’re going to investigate everything thoroughly … to ensure that we can make further improvements that will guarantee the proper functioning of this body (BCLC and GPEB) in the future.”

The good news is that the integrity and fairness of the actual games has never been and is not in dispute. Lotteries across the country have world-class security systems in place that govern the sale of tickets, the determination of winning combinations and the redemption of winning tickets. Bar codes and other security measures ensure that ticket sales are for a specific draw, and sales are cut off electronically prior to the draw. The draw itself is supervised by an independent accounting firm.

But lotteries involve much more than systems and technology, they also involve people and highly negotiable instruments – winning lottery tickets. In terms of redeeming winning tickets, suffice it to say that lotteries in Canada and worldwide are well aware that some people will go to extraordinary lengths to try to defraud others.

That is why lotteries, just like banks with their debit and credit card systems, are continuously improving their policies and practices to stay ahead of such individuals – and to protect the public interest.

Regardless, for many Canadians who may never have thought twice about it before, the idea of “insiders” winning beyond rates reasonably expected leaves a bad taste in their mouth, to say nothing of the hundreds of thousands of honest, hard-working retailers who now have had their integrity called into question.

As in any commercial activity, human nature being what it is, we cannot expect every individual in the vast lottery retail chain to be perfect. But what the public does expect, and what lotteries must deliver, is secure and fair games with redemptions rigorously monitored to ensure that winnings are paid out only to legitimate purchasers.

Canadian Gaming Business |

gamingnewsroundup A look at some numbers

Near-Term Gaming Win Growth Forecast

HLT Advisory presented preliminary results from its National Gaming Impact Study at the Canadian Gaming Summit in April. We reproduce three charts from the study here. The first, top right, shows the projected growth in Canadian gaming win through 2009. Lyle Hall of HLT called the growth “relatively modest,” about 4 per cent per year nationally.

“Most of that growth will occur in Alberta and British Columbia,” he said, “both in casinos and in a new product in British Columbia, the community gaming centres.”

The chart at right shows the percentage of revenue that comes from non-gaming sources at Canadian casino, bingo and pari-mutuel locations. Of the total revenue of $8.7 billion at these venues, Hall said, only about $700 million, or 8 per cent, is derived from non-gaming sales, such as food and beverage, retail and entertainment. That’s a very low percentage compared to Las Vegas, where non-gaming revenue has exceeded gaming revenue since the mid-1990s.

Hall predicted that non-gaming revenue in Canada will be one of the fastestgrowing areas, on a proportional basis.

The chart below compares annual gaming win in Canada to revenue for other major Canadian entertainment industries. (The television/movie rental category includes cable and pay-perview TV, and movies that are rented for home viewing.)

$20,000 $18,000

$ Million

Slow, steady growth over near-term

$16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Source: HLT Advisory Inc. based on Provincial lottery and gaming corporations’ corporations’ annual reports and HLT estimates.

CANADIAN GAMING ASSOCIATION

New Sources of Revenue Non-gaming revenue from Casino, Bingo and Pari-Mutuel >$700 million.

Other Revenue 8%

Gaming Win 92% Source: HLT Advisory Inc. based on Provincial lottery and gaming corporations’ corporations’ annual reports and HLT estimates.

CANADIAN GAMING ASSOCIATION

Honour for Aubrey

Entertainment Industries

$ Million $20,000 $18,000 $16,000

$15,319

Gaming is a major entertainment industry!

$14,000 $12,000 $9,310

$10,000

$11.0 Billion

$8,000 $6,000 $3,438

$4,000

$2,813

$2,306

$2,000

$1,226

$1,225

Movie Theater

Performing Arts

$0 Gaming

Television/ Magazines, Books & Movie Newspapers Rental

Drinking Places

Spectator Sports

Source: HLT Advisory Inc. based on information from PWC, Global Entertainment Media Outlook 20062006-2010 and data from Statistics Canada (2004 – 2005).

CANADIAN

| June/JulyGAMING 2007

ASSOCIATION

Aubrey Zidenberg, one of the pioneers of Canada’s gaming industry, received an honorary Doctor of Laws degree in April from Assumption University of Windsor. It’s rare to see a university recognize someone for contributions to the gaming industry, but Assumption University said of Zidenberg: “His contribution to the gaming industry in Canada is immeasurable and has always been tempered by his zeal to encourage responsible gaming and to give back to the various communities which he has served.”

The University also said: “His community service is exemplary; its scope intensely multicultural; its main focus, human rights inveighing against racism, anti-semitism, hatred and injustice.” Zidenberg, 54, said

gamingnewsroundup that for several years he was chairman of Ontario’s Ministerial Council on Culture and Community Development. He is currently national vice-president of B’Nai Brith Canada and serves on the board of directors of the Responsible Gambling Council of Canada.

Zeidenberg got started in gaming even before it was legalized in Atlantic City. He organized junkets, at first just overnight trips, from Toronto to Freeport in the Bahamas.

These expanded to include longer trips to Caribbean locations, Las Vegas and Monte Carlo. “At the peak, my database had over 70,000 players in Ontario, Quebec and upstate New York,” he said.

In the early 1980s, Zidenberg joined Harrah’s Entertainment as an independent marketing director in Canada. In the early 1990s, he was involved in operating a tablegames-only casino at the Canadian National Exhibition in Toronto. The casino only ran for three weeks, the duration of the CNE. But after three years and expansion to 165 tables, a successful experience with that led the government to approve the concept of roving charity casinos, he said.

Zidenberg jumped into the charity casino business. His company operated the three-day temporary casinos all over Ontario, running as many as 18 a week. His staff set them up, took them down after the three days, and trucked the equipment to the next venue.

His next step in Ontario gaming was to participate in the development of Casino Rama.

He still has a financial stake in the company that operates that casino. His firm, Casino Amusements Canada, runs junkets to Niagara Fallsview. He also has an ownership interest in Baymount, which is developing the Quinte racetrack and racino near Belleville, Ont. And his company produces the Degree Canadian Poker Championship, which it calls the largest free roll, no buy-in tournament in the country.

Nova Scotia study The Nova Scotia Department of Environment and Labour has awarded a contract for a study of the social and economic impacts of gambling in the province. The department expects the work to be completed by April.

Anielski Management beat two other bidders for the contract. In its May 18 announcement, the government said Anielski was the low bidder at $212,269.

Anielski Management is a small, familyowned company in Edmonton, headed by Mark 10 | June/July 2007

Anielski. On the firm’s website, Anielski says, “I am schooled in economics, accounting and forestry and hold a M.Sc. in forest economics, a B.A. in economics and B.Sc.F in forest science, all from the University of Alberta.”

That may seem an odd combination as background for this study, until you read that Anielski’s main professional interests are sustainability and well-being, and the measurement of both. The list of clients and projects on the website -- http://www. anielski.com/Clients.htm -- reflects an intriguing variety.

According to a June 7 story in the Winnipeg Free Press, Anielski questioned the wisdom of adding more First Nations casinos in Manitoba, which only has two. Speaking at the National Aboriginal Gambling Awareness conference in Winnipeg, Anielski said problem gambling is nine times more likely among aboriginal populations, the Free Press reported.

“We don’t have an accountability framework for gambling,” Anielski said, according to the newspaper. “We talk about social responsibility but if we were honest about the impacts, we’d put them on the financial statement.”

Managing OLG There was no news at press time on the selection of a permanent CEO for Ontario Lottery and Gaming. In April, in announcing the appointment of Michelle D i E m a n u e l e a s i n t e r i m C E O, t h e chairman of OLG’s board said the search for a permanent chief executive should take four months.

DiEmanuele is on a four-month secondment from her position as deputy minister of government services, secretary of management board of cabinet, and associate secretary of the cabinet. In addition to her provincial government work, DiEmanuele has held private-sector positions in banking and commercial real estate.

OLG needs to replace Duncan Brown, who resigned as CEO in March, three days before the release of a report by the Ontario Ombudsman that was highly critical of the OLG lottery program.

CanWest News Service reported on June 12 that two more senior OLG executives suffered from the fallout of the lottery problems. DiEmanuele fired Ingrid Peters, OLG’s vice-president and general counsel,

CanWest said, and removed Walter Fioravanti as vice-president of human resources. He will remain at OLG in a different capacity.

No Internet gambling on Alexander reserve T h e A l e x a n d e r Fi r s t N a t i o n h a s blinked first in what had been a looming confrontation with the Alberta government over Internet gambling.

In March 2006, the band formed the Alexander Gaming Commission, with the intent of licensing Internet gambling sites.

The band then set up Alexander Internet Technologies, which would develop a data centre to host the gambling sites, and also host non-gambling businesses that needed the high-tech services.

The structure was clearly patterned after the Kahnawake Mohawk Nation of Quebec, which established the Kahnawake Gaming Commission in the late 1990s to license online gambling sites. The band also created Mohawk Internet Technologies, which provides technical services to the gambling sites, and to other businesses. A server farm on the Kahnawake reserve near Montreal hosts scores of gambling sites, the only place in North America that does this.

Earlier this year, a war of words occurred between the Alexander First Nation and the Alberta government, which said that the band’s announced plans to host online gambling were illegal and would not be tolerated. Alexander First Nation replied that it was a sovereign government and had the right to regulate gaming activities within its territory, which consists of 7,280 hectares about one-half hour from downtown Edmonton.

But in May, the band changed its tune. Chief Raymond Arcand told the Edmonton Journal that the band would not start online gambling activity until it could negotiate a deal with the provincial government, and in the meantime would focus on the data centre. He complained that Alberta officials refused to discuss the gambling issue.

Cheryl Giblon, a spokeswoman for the Alexander Gaming Commission, told Canadian Gaming Business that no gambling clients had been signed for the data centre. One reason, she said, was the slowdown in online gambling since the passage in October of the U.S. Unlawful Internet Gambling Enforcement Act.

gamingnewsroundup Giblon is also the marketing director for eNation Corp., a Calgary company that contracted with Alexander Internet Technologies to design, build and manage the data centre on the reserve. There have been numerous delays in the opening of that 25,000square-foot centre. A story in Interactive Gaming News in November said the centre was slated to open in December. On April 5, Giblon told us it would open “within the week.” On May 30, she said it was “in the final commissioning stages,” with “some clients ready to move in.”

founded in 2001. Members include VLT site operators, casinos, bingo halls, treatment providers and other interested businesses and associations.

Neros comes to Casino Windsor

Canadian computer program takes on poker pros

Neros gourmet steakhouse opened June 14 at Casino Windsor. Inspired by its award-winning namesake at Caesars Palace in Las Vegas, Neros occupies 5,600 square feet next to the hotel lobby, with views of the Detroit skyline.

The restaurant’s glass-enclosed wine cellar holds 1,000 bottles and a Chef’s Table, where up to 14 diners can be served a special tasting menu. Neros also has a private dining room that seats 24.

Staff training for VLT sites The Saskatchewan Responsible Gaming Association (SRGA) recently introduced its VLT Frontline Staff Responsible Gaming Study Guide and Certificate Program. The training will be available to all employees of establishments licensed to have video lottery terminals, anywhere in the province. It was developed by SRGA with support from the Saskatchewan Liquor and Gaming Authority.

The course can be conducted by an onsite trainer or tackled independently by employees.

When they finish the course, employees must take an exam and fill out a course evaluation form. They receive a certificate of completion, which SRGA hopes will be displayed at the work site.

Service technicians with Western Canada Lottery are helping to distribute the course material, which includes information on problem-gambling indicators, common consumer myths about gambling and skills for interacting with customers.

Deidre Paluck, executive director of SRGA, said the program is the first of its kind in Canada. Operators in other jurisdictions have already requesting copies of the course material, she said in a statement.

SRGA – www.saskresponsiblegaming. com/ -- is a charitable, non-profit organization 12 | June/July 2007

The University of Alberta is pitting its renowned poker-playing computer program against two stars of the live poker world in a $50,000 contest next month. Polaris, which the university says is the reigning world champion poker program, will take on Phil Laak and Ali Eslami on July 23-24 at the Hyatt Regency in Vancouver. `The contest is in conjunction with the annual conference of the Association for the Advancement of Artificial Intelligence.

Jonathan Schaeffer, who holds the Canada Research Chair in Artificial Intelligence, is a team leader of the Polaris program. Darse Billings, who earned his Ph.D. at the university in November, worked with Schaeffer on Polaris and its predecessor programs.

In a press release from the university’s office in Edmonton, Schaeffer compared next month’s event to the famous 1994 match between IBM’s “Deep Blue” chess program and Gary Kasparov, the world chess champion at the time.

“The difference is,” Schaeffer said, “that chess is a game of perfect knowledge, meaning there is nothing hidden from the players. In poker you can’t see your opponent’s hand, and you don’t know what cards will be dealt.

This makes poker a much harder challenge for computer scientists from an artificial intelligence perspective.”

The contest is designed to eliminate the luck factor. Each human player will compete against Polaris, playing in separate rooms but with the cards being dealt in duplicate, meaning that the same cards will be dealt in both matches. This system is intended to emphasize the skill of the players by balancing out the luck of the cards. Each match will run for 500 hands of Texas Hold ’Em.

MEI buys VTI MEI Conlux, which makes unattended payment systems for the gaming, vending, amusement, transportation and retail markets, has purchased the assets of VTI, a Las Vegas company that manufactures currency validation products. Terms were not disclosed.

G. Peter Lee, founder and CEO of VTI, will remain as a consultant to MEI. The acquisition is the first for MEI Conlux since the company was bought by Bain Capital and Advantage Partners in June 2006. Previously, it was part of the parent company of Mars, the privately held candy company. It developed electronic coin mechanisms in the 1960s, followed by electronic bill validators in later years and, more recently, credit card capability for vending machines.

MEI Conlux is based in West Chester, Pennsylvania. Its equipment is used in 90 countries.

Adult diapers in the casino?

Natural Health Depot, of Kitchener, Ont., sells adult diapers along with cold and flu remedies, sleep aids, cosmetics and a host of other products. But it was the company’s promotion of the diapers that attracted press attention last month.

On its website, Natural Health says the reusable cloth diapers are “Perfect for:” and included in the short list is “Gamblers all night in the Casino.” The site doesn’t say which casino.

But a Canadian Press report took the matter very seriously. In a May 10 story, CP quoted a professor at the University of Victoria’s Centres for Addiction Research as calling this a troubling sign.

The professor, Tim Pelton, referred to an employee survey three years ago by British Columbia Lottery Corp. Casino workers in the survey, according to CP, cited cases of problem gambling that included people who wore diapers to avoid having to leave their slot machines to go to the bathroom.

Howard Blank, vice-president for media and entertainment at Great Canadian Gaming Corp., debunked the story. “It’s absolute garbage,” Blank told the Halifax Herald, which ran a story May 12. “People do not wear diapers in casinos, unless, of course, somebody has a medical condition.

Nobody wears them to gamble.”

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Lottery and Gaming Executive ‘Town Hall’ “Executive Town Hall” was the title of the closing plenary of the Canadian Gaming Summit in Toronto on April 27. Bill Rutsey, president and CEO of the Canadian Gaming Association, moderated the session.

Members of the panel were Brian Lynch, vice-president, casino gaming, British Columbia Lottery Corp.; Norm Peterson, CEO, Alberta Liquor and Gaming Commission; Max Dressler, executive vicepresident, gaming operations, Manitoba Lotteries Corp.; Larry Flynn, senior vice-president, casino gaming, Ontario Lottery and Gaming; and Marie Mullally, CEO, Nova Scotia Gaming Corp.

The following transcript of the plenary has been heavily edited for reasons of space. An ellipse (…) indicates deletions by the editor, or in some cases, words that were not intelligible on the recording.

Rutsey – Today we hear a lot about Corporate Social Responsibility and Codes of Conduct. For our industry, that primarily means responsible gaming – how we respond to the issue of problem gaming. We know from our own research that the public thinks that this is a huge issue, up to 60 times bigger than it actually is. So, my

RESPONSIBLE GAMING AND THE NEW TERM – THE DUTY OF CARE – ARE CRITICAL TO US. – BRIAN LYNCH first question: What does it mean to be responsible?

Mullally – … Responsible gambling today has evolved. It’s about being a good corporate citizen, it’s about facilitating informed choice, it’s making sure we have effective and tangible programs that are not about a pr exercise but rather something that’s going to make a difference for our players, and it’s about ensuring that we do whatever we have to do to have the highest standard of integrity … So it’s become a 14 | June/July 2007

much broader term, a much greater responsibility for all of us, to make sure that we’re doing our job right.

Lynch – … Responsible gaming and the new term – the duty of care – is critical to us. … This isn’t just our value, I think it’s the industry’s value. I’m going to do a little advertising for Cyberview. I was just out looking at some of the products they distribute in Australia, with the responsible game message tied in, and the breaks and that. I know that in our jurisdiction probably within three to five years we will require manufacturers to provide us with that level of service for responsible gaming. Duty of care is critical, not only because of the responses of the courts most recently, but I think it’s a moral responsibility as well, individually and as corporate citizens.

Rutsey – … I’ll play devil’s advocate here. Most people don’t have a problem. How do we present a product that takes the fun away from people that don’t have a problem in order to deal with the people that do? Where do we define that line?

Peterson – … I want to comment on some things that were said earlier. … I really do think that we owe our customers, our clients, our citizens a duty of care. But I have a little concern with the content

ACTIONS SPEAK LOUDER THAN WORDS. WE DO A LOT OF COMMUNICATIONS-TYPE EXERCISES, WE POST THINGS ON WEBSITES, THINGS LIKE THAT. THOSE ARE ALL VERY GOOD THINGS, BUT UNLESS YOU’RE ACTUALLY DOING SOMETHING AND CARRYING O U T P RO G R A M S T H AT A R E M E A N I N G F U L … .

– NORM PETERSON of your question, Bill, where you said the public believes the issue is 60 times greater than it really is. Well, in my rules, people’s perceptions are reality. I would be concerned that the industry is underestimating the level of this particular issue. I think it’s a very major issue and in some jurisdictions can even be greater. … Going back to your question, I do think we owe these folks a duty of care. It’s a two-edged sword. We’ve got to provide the entertainment value, because we’re in the entertainment business. But we’ve also got to look at those 5 per cent of the people, which doesn’t sound like a lot, but if you look at your population and say 5 per cent of the people have a gambling issue or could have a gambling issue, and you look at their families, it involves a lot of people. …

Mullally – I want to comment on the balance between entertainment and being responsible. I don’t buy that you can’t do both. I think we’ve got to move out of our paradigm and work creatively with everyone involved in the industry. … It means changing the way we look at our products, the way we interact with customers….

Doing one without the other would be foolhardy and inappropriate. Both of them are equally important and can be done. We just have to look at the situation differently than the way we looked at it the last five years.

Rutsey – … The statistic that I used, people think that 30 per cent of the people who gamble have a gambling problem, when we know that people that truly have a severe problem is between one-half per cent and one-and-a-half per cent. …

So how do we communicate our concern and the programs that we have in place to address that misunderstanding that we’re finding whenever we poll people around this issue?

Lynch – … The education is critical. We should be in schools now at an early age. When I say early age, I mean as a teenager, when they can learn and understand, much like with smoking and drinking. …

Rutsey – One of the questions from the audience is on this topic: Isn’t CSR just PR? How do you respond to that attitude?

Peterson – That’s a cynical attitude. Every jurisdiction, certainly in Canada, is working very hard on this issue and is very aware of this issue. It’s not pr, we do have a duty of care. … Actions speak louder than words. We do a lot of communications-type exercises, we post things on websites, things like that. Those are all very good things, but unless you’re actually doing something and carrying out programs that are meaningful, and improving on those programs – because nothing’s ever perfect when you put it in – things like voluntary self-exclusion is a work in progress in many jurisdictions, certainly in ours.

It’s something that you do and you get better at and you actually get out there and do things.

Flynn – Smokescreens only last as long as people don’t bring fans in. … So it isn’t about pr, it’s not about putting a mask on reality. It’s about managing reality and managing a better relationship with our customers.

Mullally – … I’m going to defend the person that asked that question! There is that perception. As long as we view responsible gambling programs as a way to defend our business, I think that perception will continue. …

Unless we really believe it, people are going to pick up that there’s a questionable motivation. … We do have to show tangible progress in this area. One thing we’ve really emphasized is using third-party experts to help develop our programs, which adds a credibility that we don’t have personally. … The education – we are working with an independent group, the Responsible Gambling Council of Canada, which has a high school curriculum supplement that we’re piloting in Nova Scotia called Don’t Bet on It. We’re hoping to bring that program right down to the elementary level, because I believe in Canadian Gaming Business | 15

terms of education we’ve got to get down to that level.

Their exposure to gambling far exceeds anything we would have seen in our generation. The technology, the communications, the TV, the advertisements, the tournaments …

Dressler – I agree with Marie, I think it’s a reflection not only of the culture but it’s a new way of doing business, and in my view, the only way to do business.

It goes much further than problem gambling, as well it’s commitment to the community, it’s commitment to the people that work for you, it’s about doing the right things in terms of protecting our earth and our environment and it’s embedded within the strategies and the culture of the business itself. …

Rutsey – Given the pace of change in society, we’ve gone from Irish Sweepstakes tickets being an illegal vice to

I STRUGGLE WITH THE SPEED, OR THE LACK OF SPEED, IN WHICH T H E C A N A D I A N I N D U S T RY IS MOVING ON THE ISSUE OF INTERNET GAMBLING. – MARIE MULLALLY becoming the biggest entertainment industry in Canada in a single generation. Given where we started, where we’ve come to in our lifetime, the collapse of time in technological growth, what do you see on the horizon and where do you see the industry heading?

Flynn – … I believe we’re past the stage of major growth. …. Our base continues to age. Yet the backbone of [younger] customers have been exposed to more technology than we ever were. And a lot of the product that’s out there in their minds may well be stagnant.

So we have to continue to explore and continue to do research to make sure we meet their needs.

Mullally – … I struggle with the speed, or the lack of speed, in which the Canadian industry is moving on the issue of Internet gambling. Perhaps obviously it’s politically related, or impediments in the regulatory framework, whatever it might be. But to pick up on your point on the technology … as an industry it’s such an obvious extension of bringing the entertainment experience in technology that’s now used by everyone in every generation.

16 | June/July 2007

The perception of Internet gambling is a huge issue. The perception that it’s more harmful or more risky than land-based gambling at this point is really a difficult paradigm that we have to deal with.

Because as we know, with technology the ability to put responsible gambling components into the system, ways in which people can get information that their actions may be dangerous, the ability to put messaging information about where to get help, the ability to do that with technology far exceeds what we ever do in the physical distribution delivery channel.

The image that Internet gambling is more risky and less responsible I think is a real issue the gaming industry needs to deal with. It’s something I’d love to see the association start looking at, the whole issue of Internet gambling. In fact, start looking at it as something that we should really be positioning as a very responsible way in which gambling can be offered.

Rutsey – Another question submitted by the audience kind of touched on two issues. Marie raised the issue of Internet gaming, and we’re talking about change. Someone asked, Are there any major changes you’d like to see in terms of regulation, either structural or policy-wise, and if so, what would they be?

Peterson – I think that’s more of a political question.

There are a number of things that we might like to see. People talk about changes to the Criminal Code, to allow head-to-head betting, things of that nature. Opening up the Criminal Code … that’s a political question.

Flynn – The answer is political. It’s out there, it’s happening on a daily basis, it’s a part of the business that we’re watching evaporate on other ends. As Marie said, if we’re not taking control of it, or not participating in it, then it continues to spread on a variety of different fronts, and creating, or proposing long term, that there could be issues associated with that. Someone else has to make the decision that we can go down that road, and that’s not in our realm. But we can’t assume that it doesn’t exist.

Peterson – It’s not unlike the Internet. That becomes very much an individual jurisdictional issue. Like Marie or somebody said, it’s coming, it’s here, the train is passing us by in many respects. But at the end of the day, we answer to the citizens of our particular jurisdiction, and they’re not clamouring for Internet gaming, although we can see that as a very good business opportunity. Until they tell us that they want to have Internet gaming or any other form of gaming, we’re not going to go down this road.

I ALSO BELIEVE AS AN INDUSTRY THERE ARE CHALLENGES IN THE WAY THE OWNERSHIP MODEL WORKS. HAVING GOVERNMENTS OWN GAMBLING THE WAY THAT THEY DO, I THINK CLEARLY IMPEDES OUR ABILITY TO PROGRESS AND GROW. I THINK GOVERNMENT CERTAINLY HAS A ROLE TO REGULATE, THAT’S A VERY IMPORTANT ROLE. – MARIE MULLALLY Mullally – … I think as an industry, if we’re really looking at the getting into that, currently I don’t think we can effectively compete. I industry from a global perspective in Canada, obviously we want to think that’s a huge issue on the technology side and Internet gambling. be able to effectively compete. I recognize there are laws etc. Without I think we’d all like to be in that business in some capacity; we’d like government to play some kind of regulatory role with regards to it.

From a policy, that’s an area, at least for our jurisdiction, we’d like to have addressed in some way.

I also believe as an industry there are challenges in the way the ownership model works. Having governments own gambling the way that they do, I think clearly impedes our ability to progress and grow. I think government certainly has a role to regulate, that’s a very important role. But I question whether it’s important for government to operate. I think that does impede on the competitive ability to …

Rutsey – Marie, you’ve raised the heart rate of all the private-sector guys in the room!

Mullally – I recognize I’m government and I operate, but I question whether that’s the right role. … I think government does have a role in the industry and I think it’s a regulatory role, because I think the industry would thrive, would be stronger, if we could compete effectively and could operate without impediment. … Now I’m blue-skying here, remember that!

Thank you to all those who visited our booth Lynch – I would just like to tackle the Internet. The problem I have with us at the 2007 Canadian Gaming Summit! not being in that arena and being able to operate, is without [us] being there things are happening and problems are developing. There’s not a signal for 4SeWV [` ?a`fdWS^ 5S`SVS 9F EkefW_e [e S Xg^^ eWdh[UW Ua_bS`k VWV[USfWV fa bdah[V[`Y [fe fWUZ`a^aY[US^ WjbWdf[eW fa responsible gaming. These people are not interested in that. They’re in it VW^[hWd cgS^[fk ea^gf[a`e S`V bdaVgUfe fa agd Ugefa_Wde 9F for quick dollars. So I think it’s critical. I think that we’re in business and EkefW_e iSe Xag`VWV a` fZW bd[`U[b^W aX [``ahSf[hW fZ[`][`Y S`V that we should be in there. We’re going to get painted with the brush in any iad^V U^See Ugefa_Wd eWdh[UW 8da_ agd g`[cgW YS_[`Y ][ae]e fa agd WkW USfUZ[`Y fST^We agd bd[_W aT\WUf[hW [e fa geW Ugff[`Y WVYW event, it’s part of gaming. So I think we should be moving there, as part of fWUZ`a^aYk S`V VWe[Y` fa bdah[VW agd U^[W`fe i[fZ Uaef WXXWUf[hW the regulation, but certainly carrying our responsible gaming luggage into ea^gf[a`e dW^Sf[hW fa fZW[d `WWVe MERCI À TOUS! that arena.

Peterson – Brian, until you take it out of the hands of government, that’s not '4 3YSTEMS going to happen.

F, '#& )&& %#$$ 8, '#& )&& '##& Lynch – The reality is, it’s law, the way we operate. We’re Crown corporations iii YS_Wfda`[j Ua_ and that’s the reality. Until there’s a major change, I can’t see that. I mean, if 18 | June/July 2007 GameTronix_1_4_June2007.indd 1

6/18/07 3:23:17 PM

they can’t deal with sports betting, how are they ever going to deal with …

Peterson – I don’t disagree with you. It’s in the Criminal Code, it’s sitting there. It ain’t going to change.

Dressler – Well the last Criminal Code amendments in earnest were in 1985. So that gives you an idea of how long it’s been.

Rutsey – You guys are anticipating my next question. … Sports betting is the single largest Internet gaming product. Sports writers across the country routinely criticize that folks can’t legally access the product they want most – to bet on the outcome of a single event. At Super Bowl time, look at sports books in Nevada, $100 million bet on that one game. And it’s estimated that’s about 1 per cent of the amount that’s actually bet. … Given the obvious market demand, should the law be amended to allow single-event wagering?

Lynch – … I don’t think it’s a huge revenue producer, but I think it’s another product that we should be able to offer, to add entertainment value to our properties. …

Mullally – Ditto to Brian’s comment. I think he’s bang on. Sports betting is a huge opportunity. …

Trying to make it work in the current framework is difficult. …

Flynn – We’ve created a variation at a couple of our resort properties, Niagara and Windsor.

We’ve certainly enjoyed moderate success.

The ability to alter and change the mix. It’s incrementalism, it’s a matter of doing different things that create excitement for the customer.

Peterson – There are myriad ways you could offer these particular products. … But you’ve got to make sure your citizens do want it, that they don’t feel that they’re being overwhelmed by gaming activities. One of the issues we grapple with in Alberta is: how much gaming do we have? Do we have enough? We’re going to have 25-26 casinos in Alberta within the next two years. We have roughly 20 at this point. … The question is, when do we reach the saturation point? … Things like sports betting fall into that equation. …

Lynch – … The public should be able to make the decision [about] what they want. With bingo, the reality is that it’s a dying industry. We’ve got community gaming centres, we call them

Chances. It’s bingo and they have slot machines in the same venue. … Customers makes a choice which side of the room they want. I don’t think it’s our responsibility to say “We’re not going to put this in because somebody else is going to suffer.” I think we have to look at what the entertainment value is for the customer, as long as it’s done responsibly.

Mullally – … I struggle with the idea of waiting for people to ask for something that we know people are using everywhere around the world and not trying to be proactive and try to anticipate some of the demand. Because if you’re truly operating a business that’s trying to optimize profits in a socially responsible way, then you’ve got to be constantly looked ahead. …

Ultimately, we’re in a competitive environment.

Rutsey – Another question from the audience: With respect to online gaming, do you plan to follow BCLC and ALC and offer some online products?

Peterson – We’re watching what happens in B.C. and Atlantic lotteries. We’re still looking at the Internet question. Our question really is: Do our citizens want it? …

Flynn – I think if the powers that be make the choice that it’s acceptable, then of course we would be interested.

Rutsey – One last question from the audience: What strategies do you employ for dealing with hostile media?

Peterson – … As long as what you give them is well-put-together, is honest, is the truth, I think you’re going to come usually to a draw.

Flynn – We’ve not encountered any media problems! …

Mullally – … We made a lot of mistakes, quite frankly, in the first years I was with the gaming corporation. We didn’t nurture those relationships. We only met them when we had a good news story, not a bad news story. … Our job is to make it as easy as possible for them to pick up the messages that we want them to pick up. But that won’t happen unless you forge those relationships. … When there is a bad news story, you’ve got to be proactive. … Told information has much greater value to the media than found information. …

Canadian Gaming Business | 19

gamingpersonality

Gordon

By Aaron Todd

Mackay Partner, Mackay | Wong Strategic Design If Gordon Mackay ever needs to remember where his firm got started, all he needs to do is go downstairs.

The 41-year old Toronto resident started Mackay | Wong Strategic Design with partner Ron Wong in 1992, just a year after he received his Master’s of Architecture from Dalhousie University. They opened their Toronto office on Blue Jays Way, and the first job they landed was just one floor down from their offices, designing Wayne Gretzky’s restaurant. Mackay goes by that restaurant every day on his way to work, but the firm’s business focus has expanded beyond restaurants to include gaming facilities.

The firm got its start in the gaming industry with a few small food and beverage projects at Casino Rama in 1999, and as the years have gone by, their gaming business has grown to include every aspect of gaming facilities.

“We’ve graduated from being where we just sort of inserted a food and beverage unit in a gaming property to being a key strategic part of the master planning of a new facility, and that’s where the real joy is,” Mackay said. “We can actually consider the guest experience from the minute they open the door to the minute they leave so that every aspect of hospitality and gaming and retail is by our hand. And what you get in that case is a really cohesive, well-considered branding experience.”

20 | June/July 2007

While the company’s background was in restaurant design, it didn’t take Mackay long to understand the fundamental concepts of designing gaming properties.

During his first gaming gig at Casino Rama, Mackay learned about the whole gaming experience, instead of simply focusing on the food and beverage areas. What struck him more than anything was the 24-hour use that gaming properties demand of their facilities.

“Food and beverage has to be ready to serve a guest as well in the morning as it does at night or on the weekend,” Mackay said. “The kind of stress that a 24-hour facility plays on these spaces affects the kinds of materials that you select. They’ve really got to be bulletproof because they’re used full time and they’re used longer than anything on the street is typically used.”

Mackay’s first work on the actual gaming floor came at Ajax Downs, an Ontario Lottery and Gaming racino near Toronto, in early 2005. The firm just completed one of its largest gaming projects, helping Casino Windsor renovate, expand and transform itself into a Caesars property.

[Under a licensing agreement between OLG and Harrah’s Entertainment, Casino Windsor will become Caesars Windsor early in 2008.]

Before the Caesars licensing agreement was signed, Mackay | Wong was tasked with designing a 750-seat buffet, and later was hired to design a major public space called the Rotunda that included an upscale lounge and lobby bar. Once the decision was made to brand the casino as a Caesars property, the firm was poised to be a major player in that effort.

“As you can imagine, this changed our design course dramatically,” Mackay said. “We found ourselves in the lead strategic position to collaboratively guide the facility’s branding transformation with Harrah’s, OLG and Casino Windsor.” And while Caesars

Palace in Las Vegas is already an established brand, Harrah’s knew that replicating the Vegas Caesars in Windsor wouldn’t work.

“They’ve been working really hard on trying to understand what the core value of the Caesars brand experience is,” Mackay said. “We happened to be in the right place at the right time and we’ve worked with them on how to redefine what it means to walk onto a Caesars property that’s not in Las Vegas. They were looking for a much more contemporary way to transport the Caesars imagery.”

Mackay certainly knows how to build a brand. He helped the Hard Rock Café expand its brand in Canada, starting in 1995. The firm worked on new locations in Vancouver, Whistler, Edmonton, Calgary, Banff, Kanata, Ottawa and Niagara, and helped renovate existing Hard Rocks in Toronto, including at the Skydome, and in Montreal.

“The unique aspect of (the Hard Rock Café expansion) was the concept we proposed to add an element of a regional theme to each location,” Mackay said. “As a result every

Hospitality

Canadian location shared its core ‘Hard Rock’ design values, but we also had the freedom to make each experience unique through a celebration of local musical influences, regional history and distinct cultural influences.”

Mackay also worked on designing the Rain Forest Café concept, and those experiences in the firm’s early years helped the team learn how to fully develop a customer’s experience.

“What happens on a gaming floor in a casino is not unlike what happens in a restaurant,” Mackay said. “You’re welcomed, you’re entertained and you’re essentially being offered a memorable experience.”

There are two different types of gaming facilities that try to deliver that memorable experience, Mackay believes, and in order to be successful, they need to go about it in different ways.

Some gaming facilities are destination properties with little or no local competition, like Casino Rama. Or they’re in a competitive market like Casino Windsor, which fights for market share with three casinos across the

Leisure

border in Detroit. Isolated destination resorts need to be more universal, Mackay said, because “if you overly commit to themes on the gaming floor, (the players) will tire of them.”

Facilities in competitive markets, however, need to differentiate their gaming floors with strong themes because people can make choices among several properties.

No matter what kind of property he’s dealing with, Mackay knows that if he lands a gaming project, it will be demanding. But he welcomes that challenge.

“The one thing the gaming environment really affords us is a creative backdrop to play with unique ideas and experiment with materials,” Mackay said. “The stress and timelines are something we thrive on. We’ve been in the hospitality business for 15 years with hotels and resorts, so in some ways we’re sort of suckers for punishment.”

Aaron Todd is a gaming industry reporter based in suburban Boston for Casino City Times, www. casinocitytimes.com.

Tourism

Lyle Hall and Robert Scarpelli have been providing consulting and advisory services to the Canadian and International hospitality, leisure and tourism industries for over 15 years.

Areas of specialization: Gaming Lodging Attractions

Travel and Tourism Public Assembly Venues Recreation and Sports

HLT Advisory Inc. 384 Adelaide St. W. Suite 200 Toronto, ON M5V 1R7 (416) 924-7737 www.hlta.ca Please contact us: lylehall@hlta.ca robertscarpelli@hlta.ca

Canadian Gaming Business | 21

Ombudsman Report on B.C. Lottery:

‘Dysfunction’ in Securit

By Christine J. Mingie

Canadian Lottery Retail Sites 4,390 2,280 785 9,843 850 10,800 3,584 Atlantic Canada

Source: HLT Advisory Inc. based on data from Provincial Lottery and Gaming Corporations, 20052005-2006.

British

CANADIAN GAMING ASSOCIATION Columbia has the

third-highest number

of lottery retail outlets, as shown in this graphic prepared by HLT Advisory. The numbers were accurate as of March 31, 2006.

In December, British Columbia’s Ombudsman, Kim Carter, launched an investigation into the fairness of the lottery program run by the British Columbia Lottery Corp. (BCLC). The investigation followed on the heels of reports that there were serious integrity issues with the lottery program in Ontario in which lottery retailers (insiders) were, against improbable odds, winning the lottery with disturbing frequency. The Ombudsman intended to find out if British Columbia’s lottery program suffered from similar issues of integrity.

The findings The Ombudsman’s report, entitled Winning Fair and Square: A Report on the British Columbia Lottery Corporation’s Prize Payout

22 | June/July 2007

Process, was released May 29. Although quite lengthy, the report was not as harsh as the report by her counterpart in Ontario. The Ombudsman determined that the lottery system was open to possible abuse, but she found no real evidence of insider wrongdoing at the lottery retailer level. Although there were a handful of unusual insider wins over a four-year period, the Ombudsman could not determine whether insiders had won the lottery at a statistically disproportionate rate over that time.

The Ombudsman did find, however, that BCLC security procedures for paying out wins were ineffective and that its internal procedures for identifying suspicious insider activity were inadequate and were not consistently applied. She also found that BCLC lacked reliable procedures for tracking and addressing complaints from the public about suspected insider fraud.

The Ombudsman was, she said, “surprised at how much dysfunction there was in the system. I think, like everybody else, we assumed that there were processes in place [to protect players].”

But the most serious finding, buried deep in the middle of the report, was the disturbing conclusion that for years the BCLC, contrary to its obligations under the Gaming Control Act, systematically failed to notify the Gaming Policy and Enforcement Branch (GPEB) – the regulatory body that regulates it and all other provincial gaming activity – of any activity or incident in the lottery system

ty and Enforcement that was contrary to the Criminal Code or the Gaming Control Act, or that may have affected the integrity of gaming (referred to as Section 86 reports).

The filing of Section 86 reports ensures that GPEB is advised of conduct that affects gaming in the province and can respond adequately to preserve the integrity of gaming. The larger question, and one which was not within the scope of the Ombudsman’s mandate, is whether BCLC also failed to file Section 86 reports with GPEB in connection with the non-lottery gaming activity it conducts and manages, such as casino and bingo operations.

program until such time as GPEB is satisfied that BCLC has complied with its recommendations and to report publicly on BCLC’s compliance in this regard.

• Surprisingly, the Ombudsman did not specifically recommend that insiders be registered under the Gaming Control Act, a requirement which would ensure that they be found suitable to sell lottery products.

• In order for GPEB to effectively assume its increased oversight role over the BCLC, the provincial government will have to approve a significant increase in GPEB’s annual operating budget.

Key recommendations GPEB to Monitor BCLC Compliance

Insiders and the Validation Process

The Ombudsman made 27 recommendations directed at improving the lottery payout system, the most important of which is the enhanced regulation of BCLC by GPEB. The Ombudsman recommended that GPEB: • regularly audit BCLC’s lottery program, including independently investigating public complaints into BCLC’s payout procedures and report publicly on its investigations on an annual basis; • enforce BCLC’s compliance with the Gaming Control Act, specifically by ensuring that BCLC files its Section 86 reports; and • oversee B CLC ’s compliance with recommendations made by GPEB in December 2006 to improve the lottery

In order to strengthen protection against insider fraud, the Ombudsman recommended that BCLC maintain a list of insiders and require that insiders use a swipe card or enter a code before each lottery purchase. It was also recommended that BCLC track and report on insider plays and wins at all prize levels and that it: • collect information from winners holding tickets above $1,000; • audit all wins above $3,000; and • improve the validation process at the retailer level.

• create and implement an effective complaints procedure.

BCLC takes action, but it’s not over yet Although the Ombudsman’s report has been released, things are far from over for BCLC. British Columbia’s Solicitor General, John Les, announced an independent and comprehensive audit of BCLC’s lottery system and GPEB’s oversight role of BCLC. The audit will determine how and why the lottery system was left vulnerable to potential fraud. In the meantime, BCLC has accepted all of the 27 recommendations and intends to implement them over the next few months.

The day after the report was released, Vic Poleschuk – in one of his last official acts as CEO – announced that BCLC will “prohibit all lottery retailers and their employees from purchasing, playing or validating their personal lottery tickets at their place of employment – the first jurisdiction in Canada to do so.”

As happened in Ontario, the first casualty in the fallout from the Ombudsman’s report was the CEO of the lottery corp. On June 1, the board of directors of BCLC announced that Poleschuk was terminated, effective immediately. The board planned to meet the following week to discuss the hiring of an interim CEO.

Improving the Complaints Process Other recommendations include the suggestion that the BCLC: • improve its internal control procedures and perform audits on these procedures; and

Christine J. Mingie is a lawyer with Lang Michener LLP in Vancouver. She advises on gaming regulatory and compliance matters for a large public gaming company.

Canadian Gaming Business | 23

Photo courtesy of Ontario Tourism/J. Speed

First Nations Gam

After 11 Years, More Casinos and 24 | June/July 2007

Gaming on reserves doesn’t rank up there as a national First Nations issue as much as land claim disputes that lead to road and rail blockades and other confrontations. But it illustrates a gap between what basically self-governing First Nations are free to do on their own land and their desire for gaming revenue to deal, typically, with impoverishment, general neglect, crime, alcohol and drug abuse.

The gap is narrowing, but slowly.

Manitoba’s government is edging toward giving First Nations in the province the right to regulate gaming on their reserves, much like Saskatchewan, where First Nations manage and operate and regulate the table games at their four casinos, under licenses issued by the Saskatchewan Gaming and Liquor Authority.

Alberta is not far behind. Meanwhile, more licensed aboriginal casinos have opened over the past five years in western Canada, with more to come. None will top aboriginal Casino Rama’s $500 million annual gross, but the revenue will help aboriginals build community infrastructure and deal with unemployment and weak economic development.

The money is out there. First Nations casinos across Canada are grossing $804 million a year, according to Clint Davis, national director of aboriginal banking for the Bank of Montreal in Toronto, speaking at the Canadian Gaming Summit in April in Toronto.

The money flows from gaming operated by 35 per cent of the 633 First Nations in

ming

Canada, and it’s just the beginning.

“Casinos are still in the growth stage, although we’re probably 10 years behind the United States [where tribal gaming in 28 states chalked up gross revenue of US$22.6 billion in 2005, according to the National Indian Gaming Association, Washington, D.C.],” Davis said.

Legal aboriginal gaming in Canada is little more than 11 years old, but what a difference from 1996 -- when the Supreme Court of Canada upheld criminal convictions against members of the Shawanaga First Nation and the Eagle Lake First Nation in Ontario for running unlicensed, high-stakes bingo games and lotteries on reserves.

The court ruled that self-government on reserves under the federal Indian Act doesn’t include tribal councils enacting bylaws to regulate gaming activities.

Nor is there any history of routine tribal gaming, which excluded a legal defence based on cultural or traditional grounds, the judges added.

Provinces, but not First Nations, get the right to operate gaming Provincial governments took on the authority to license, regulate and operate gaming in Canada by way of amendments to the federal Criminal Code, enacted in 1969 and 1985.

Toronto gaming lawyer Michael D. Lipton noted in a paper presented at an International Masters of Gaming Law conference in Ottawa in 2004 that the First Nations may have missed a rare opportunity.

“Had national organizations actively lobbied for the principle of gaming as an inherent aboriginal right at that time,” Lipton said, “the federal government might have been open to including provisions specifically exempting on-reserve gaming from the Code, perhaps in tandem with the creation of a national gaming regulatory body specific to the First Nations.”

But they didn’t. First Nations require provincial approval for any kind of gaming, contrary to the accepted view of their territorial sovereignty, which should include the right to conduct gaming, Lipton said in his paper.

By Albert Warson

d More Control Over Operations Canadian Gaming Business | 25

Prairie Entrepreneurship

A new generation of First Nations casinos is rising on the western plains, mainly near the smaller cities. No longer merely places to play a few hands of cards or spin slot machine reels, the new casinos come with hotels, spas, fine dining, entertainment, even an 18-hole championship golf course in one case. And these facilities not only benefit the tribes and provincial governments, but they enhance their neighbouring municipalities.

The greatest concentration of aboriginal casinos in Canada, either operating or approved, is in Saskatchewan, followed by Alberta and Manitoba.Saskatchewan may well continue in the lead, given a 26 | June/July 2007

rather surprising statistic offered

by Morley Watson, vice-chief, Federation of Saskatchewan Indian Nations, who said 40 per cent of the province’s population will be aboriginal by 2045. Regardless, he said: “This project [the new $35 million, 50,000-square-foot Living Sky casino under construction in Swift Current] is not just for First Nations, but for everyone,” he told The Southwest Booster in April.

When completed, Living Sky will employ up to 200 fulltime and part-time workers. Its gaming floor will have 220 slot machines and 10 table games.

The theatre will seat 600.

There is a wider implication: First Nations casinos attract free-

spending tourists and employ staff (such as 200 employees who jointly earn $7 million a year at the Painted Hand Casino in Yorkton), who will support Swift Current, Watson said, “by purchasing goods and services -- homes, vehicles, furniture, electronics and the list goes on."

The one aboriginal casino in the province that will outdo the others for scale and pizzazz is the 100,000square-foot Dakota Dunes Casino and Resort opening in September on 405 hectares of Whitecap Dakota First Nation reserve land near Saskatoon. It will feature an 18-hole championship golf course, an entertainment complex, hotel and spa.

In a mission statement, the Whitecap Dakota First Nation noted that partnerships between aboriginal and non-aboriginal organizations “are an integral part of the sustainable economic development strategy for our community. Our partnership arrangements have created mentoring programs, employment agreements and business developments with a number of private and public organizations.

But some of our most exciting opportunities are yet to come [such as commercial, recreational and light industrial developments].”

It is a statement that reflects an optimism and confidence that other First Nations elsewhere in Canada might well envy, particularly those whose claims to ancestral lands are disputed.

Gaming and entertainment are the building blocks for the future wellbeing of tribes who share in casino revenues.

-- Albert Warson

(First Nations treaty rights are also generally enshrined in section 35 (1) of the Constitution Act, 1982.)

The gaming issue may not seem terribly complicated or even troublesome, but there are several hurdles. An application for a First Nations casino must satisfy Section 207 (1) (a) of the Criminal Code, which defines legal gaming and authorizes provincial governments to operate gaming in their jurisdictions. In turn, they may, or may not, issue a license.

Manitoba – problems with local referendums Then there are municipal referendums. In Manitoba, for example, three out of five proposed First Nations casinos were defeated in small provincial communities. In comments at the Toronto summit, Rick Josephson, executive director and CEO of the Manitoba Gaming Commission, said the Assembly of Manitoba Chiefs (AMC) is “trying to shift the goal posts by revising the playbook which authorizes the conduct and management of First Nations gaming in Manitoba, but the Criminal Code is still paramount in all these issues.”

Josephson set out the background: The Desjardins Report in 1995, which was supposed to canvas a “wide-ranging review of [gaming] policies and practices,” didn’t really go anywhere. The Bostrom Report in 1997 advanced the process, but not very far. Then in 1999 the Manitoba government created a casino study project, and in early 2000 issued a request for proposals to elicit First Nations interest in operating casinos, still at the discretion of the provincial government and under its control.

From 12 proposals, five were accepted, pending local referendums. Two survived the referendum process and were built.

One was the Aseneskak Casino Limited Partnership with the province and Manitoba Lotteries Corp. at the Opaskwayak Cree Nation in The Pas, about 500 kilometres north of Winnipeg.

The Aseneskak First Nations consortium operates the casino, which opened in 2002. The agreement sets the Aseneskak share at 70 per cent of the net income, with 27.5 per cent going to a First Nations Trust and 2.5 per cent for First Nations addictions programs.

The other was the South Beach Casino resort 30 minutes north of Winnipeg on

the Brokenhead Ojibway First Nation at Scanterbury, which opened in 2005, developed and managed by Hemisphere Companies, of Minneapolis. South Beach has already added 4,000 square feet of space, although a provincial moratorium prevents the addition of more slot machines.

Ian Cramer, the AMC’s senior business adviser and a fellow panellist at the Toronto Summit, said proponents of the three proposals that failed are seeking compensation of $100,000 to $2 million from the province in development costs.

There were other milestones on the bumpy road to First Nations stewardship of gaming in Manitoba. The most important one that remains is a joint government-AMC report released in late 2003 which agreed to greater First Nations gaming self-regulation – depending, that is, on an independent feasibility study to determine whether anyone really needs or deserves more casinos, each likely to be in the range of 1,500 slots.

Cramer said the 2003 report “brought both parties’ interests closer together, although the province wanted to maintain the legislative status quo.” The feasibility study will also consider the creation of a First Nations Gaming Corp. to conduct and manage gaming operations, select and own the gaming equipment, take responsibility for security and budgeting, and determine prize payouts, he added.

He said a draft version of the study is in the hands of the provincial government and he expects some of it will require clarification. As to when it will be released, Cramer noted that the provincial government was in an election mode this spring and will need some time after the election to return to a normal work schedule.

A First Nations Economic Development Fund that will receive a percentage of casino

Casino Rama

28 | June/July 2007

A First Nations Economic Development Fund that will receive a percentage of casino profits has been approved. profits has been approved, Cramer said, but is winding its way through the “nuts and bolts stages” of planning, developing application forms and appointing a board of directors.

The percentage is small – 1.3 per cent a year up to 2 per cent in the fifth year, when Cramer expects the Fund will get $5 million – but it’s a start. He also expects cash to start flowing into the Fund by late this summer.

Saskatchewan – from “off-reserve” to “urban reserve” In the end, First Nations in Manitoba are

expected to have similar rights to develop and perhaps even regulate casinos as the nonprofit Saskatchewan Indian Gaming Authority (SIGA), which represents 74 First Nations in that province. SIGA looks after operational services, and conducts and manages table games through licences issued by the Saskatchewan Liquor and Gaming Authority, which in turn is responsible for the conduct and management of slots at the SIGA casinos.

Casino Rama in Ontario attracted a lot of attention when it opened in 1996, but that same year the Bear Claw casino in Carlyle, the

Casino Rama – Still the Largest and Most Successful F i r s t Nat i o n s gaming in Canada opened with a splashy cash-gushing bang in 1996 at Casino Rama, with 2,300 slots and 120 table games on the 1,012hectare Chippewas of Mnjikaning First Nation reserve near Orillia, Ont., about 145 kilometres north of Toronto. The Ontario government chose the reserve as the site for the casino, so the Mnjikaning band didn’t have to humbly apply for permission.

Rama thrived from the beginning, and is far and away the largest and most financially successful aboriginal casino in the country. The government takes 20 per cent of the gross revenue; the Mnjikaning First Nation gets 35 per cent of the net income and the other 65 per cent is distributed among the other 133 First Nations in Ontario.

When the casino opened, everyone figured it would top out at $250 million in annual revenue, Chief Sharon Stinson Henry told a session at the Canadian Gaming Summit in Toronto in April. Instead, annual revenue is double that figure, $500 million.

Casino Rama’s success has been spurred by the addition of a 300-room full-service hotel, spa and health club, more restaurants and a 5,000-seat theatre featuring big-name entertainment. It also boasts a choice location, a few kilometres off the main north-south highway in the middle of Ontario’s densely populated, year-round cottage country. Not to mention a two-hour drive from Greater Toronto Area’s population of 4.5 million.

An aging populating has added a booming market of seniors who head for the casino slots and table games by the busload. Admittedly, these are not high rollers, but those quarters pumped into the slots add up.

“The money has allowed us to invest in education, [native] culture, health and social services, and economic development,” Henry said, “also. expanding

community centres, arenas and other recreationalfacilities and providing opportunities for employment.

“We have established a culture department. Many First Nations don’t know their history and practices, or who we are. Our elders have come forward and helped us set up courses to restore our language,” she said, adding that the casino has been“quite an adjustment for our seniors, who haven’t gotten used to being awakened by lights from cars in the parking lot shining through their windows.”

Henry would not discuss details of the court action initiated by the Mnjikaning in July 2001 to access a larger share of Rama’s net income from the provincial government, because the case is still before the court.

She noted that three non-aboriginal commercial casinos in Windsor and Niagara Falls, charity casinos and racinos across the province are stiff competition, which has encouraged greater attention to customer service at Casino Rama.

Apart from the First Nation reaping the rewards of its 35 per cent of the casino net income, neighbouring cities and towns have benefited from spinoff tourism and shopping, the casino’s purchase of local goods and services, and local spending by its 700 aboriginal staff.

Casino Rama is the largest single employer of aboriginal people in Canada.

Under a contract with Ontario Lottery and Gaming, Penn National Gaming, of Wyomissing, Pennsylvania, manages all of the casino operations -- its 100,000 square feet of gaming space, the restaurants and theatre.

The government’s Alcohol and Gaming Commission of Ontario licensed the casino and regulates its operations.

-- Albert Warson

Northern Lights in Prince Albert, the Gold Eagle in North Battleford and the Painted Hand in Yorkton opened their doors. News of those four events didn’t travel very far, but they were a watershed for Saskatchewan.

They were “off-reserve” casinos, like another one heading toward a late 2008 opening in Swift Current, after it was narrowly approved in a referendum. Off-reserve means

the land bought by First Nations can be used as security to finance casino development (reserve land isn’t considered collateral because it is owned by a community, not by individuals). Its status can later be changed from off-reserve to “urban reserve,” with the same status and benefits as reserve land. A legal gimmick, but it works.

The Living Sky Casino in Swift Current

30 | June/July 2007

is expected to be converted into an “urban reserve” at some point, as were the first four aboriginal casinos in the province. In May 2007 tribal elders offered tobacco to the spirits to bless the project, preceding the start of construction in June.

First Nations aren’t the only ones hoping to cash in on casinos. The business community in Swift Current had been trying to revitalize the city's economy for more than 10 years. "At that time, our economy was very stagnant," Mayor Sandy Larson told The Southwest Booster, a Swift Current newspaper, in late May. "We were hoping we could get something to draw people off the highway."

And they did. Living Sky will be the only casino in Saskatchewan adjacent to the TransCanada Highway, with more than 1 million cars a year passing the site.

Edmund Bellegarde, CEO of SIGA at the time, picked up the ball, and the Swift Current Allied Arts Council came on board. That group’s support was important because the province’s gaming agreement with the Federation of Saskatchewan Indian Nations (FSIN) hinges on community and municipal support.

Zane Hansen, SIGA’s current president and CEO, told a Toronto Summit session that the new casino will be in partnership with the Saskatoon Tribal Council. These new casinos and renovations to existing properties represent $120 million in capital investment, he added.

Hansen also noted that SIGA’s payroll of about 1,150 people will increase to 1,700 by 2008. Moreover, 73 per cent of the casinos’ employees are aboriginals who not only need the jobs, but also want to develop skills and build careers. “We had a career fair for some of our properties and attracted 1,000 resumés,” he recalled.

SIGA turns over 37.5 per cent of its net profits to the provincial general revenue fund and 37.5 per cent to the First Nations Trust.

The remaining 25 per cent goes to community organizations through the Community Initiatives Fund.

At the end of his presentation, Hansen mentioned in passing that as of April, table games in First Nations casinos in Saskatchewan have been regulated by First Nations regulators, not by provincial government employees. That may seem like a

small gesture, but it has symbolic importance.

Indigenous Gaming Regulators, part of FSIN, now enforce the rules for table games.

Alberta – one open, more on the way In Alberta, a provincial moratorium on new or expanded casinos, including those of First Nations, was lifted March 1, 2002. With the door open, the Alberta Gaming and Liquor Commission (AGLC) invited applications and by July 2005, the Enoch Cree and Alexis Nakota Sioux Nation reserves had been approved for casinos.

River Cree Resort and Casino opened on the outskirts of Edmonton in October 2006. The Alexis Nakota project at Whitecourt, about 1½ hours from Edmonton, is slated to open late this year.

It will be called the Eagle River Casino & Travel Plaza. Paragon Gaming, a Las Vegas company, is a minority partner in both River Cree and Eagle River.

In August, the Cold Lake First Nation plans to open an $11 million casino on its reserve northeast of Edmonton, near Alberta’s border with Saskatchewan. And

the Tsuu T’ina First Nation is building a casino on its reserve just outside the city limits of Calgary. Its $40 million Eaglestone Casino is also supposed to open in August.

Also under development is a casino resort on the Stoney Nakoda First Nation reserve, between Calgary and Banff. The property, scheduled to open in December, will be managed by Mayfield Consulting, a Canadian company. The AGLC regulates First Nation on-reserve casinos.

Aboriginal casinos in Alberta get 15 per cent of their slot machine revenue. Another 15 per cent goes to approved charities and the remaining 70 per cent goes into the Alberta Lottery Fund. Of that 70 per cent, 30 per cent is for traditional Alberta Lottery Fund initiatives and 40 per cent goes to the First Nations Development Fund -- available to all provincial aboriginal groups to support social and community development, and health, education and addiction programs.

off sharply at both ends of the country.

The Casino of the Rockies at Cranbrook, B.C., which opened in 2002, is part of the St. Eugene Mission Resort and is the only aboriginal casino in the province. [See story on page 36.]

On the east coast, First Nations aren’t even directly involved with Casino Nova Scotia in Sydney, but have had a 50 per cent share of its “cash available for distribution” since it opened in 1995.

Ontario is dripping with commercial and charity casinos and racinos.

Grandiose plans for gaming expansion in Quebec are a dead duck, politically.

That leaves the prospects for more First Nations casinos across Canada to Manitoba and points west.

The biggest challenge left for the First Nations is to wring from provincial governments the right to license, operate and regulate casinos on their reserves, or off reserves on land they have bought with gaming in mind.

New sites unlikely east of Manitoba The presence of First Nations casinos drops

Albert Warson is a freelance writer based in Toronto.

Canadian Gaming Business | 31

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Ontario Bingo Reform:

New Revenue Split, More Game Flexibility

By Troy Ross

34 | June/July 2007

On May 1, the Alcohol and Gaming Commission of Ontario (AGCO) introduced the longawaited “new revenue model” for the charitable bingo industry.

The new model is the culmination of two years of work with bingo industry stakeholders.

The Registered Gaming Suppliers of Ontario (RGSO) and the Commercial Gaming Association of Ontario (CGAO), representing bingo hall operators; the Ontario Charitable Gaming Association (OCGA), representing charities; and the Association of Municipal Managers, Clerks and Treasurers of Ontario all participated in the AGCO bingo working group that crafted the new system.

Jean Major, CEO of the AGCO, said that the intent of the new revenue model is to improve profitability for charities and hall operators, and to provide maximum flexibility to an industry sector that has been widely considered to be over-regulated for decades. “We expect that the new model will allow bingo to offer more attractive prizes and a variety of new games that customers want to play,” he said.

The bingo industry has quickly embraced the new model. Lynn Cassidy, executive director of OCGA, which represents thousands of charities that benefit from bingo, said, “We hope that this new model will preserve bingo as an important fundraising tool for charities. We believe it will provide opportunities for enhancement of the industry in the future.”

Bingo hall operators are also enthusiastic supporters of the new revenue model. Cam Johnstone, the owner/operator of Delta Bingo, which owns 11 halls, called the new revenue model “the most significant and positive change to the bingo business in Ontario’s history. The new flexibility is the critical element for bingo operators to be able to offer creative and exciting games, with bigger prizes and a better customer

experience. I think it will ultimately lead to a reinvigorated charitable bingo sector.”

The process began in May 2005 when the AGCO released a discussion paper entitled A Consultation Document on the Modernization of Charitable Gaming. The AGCO recognized that the previous regulatory regime governing charitable gaming, introduced in the early 1990s, was outdated. The consultation paper was intended to engage the industry and ask for its input on potential improvements.

In response to the consultation paper, the AGCO was flooded with comments from bingo, break open ticket and raffle industry representatives requesting radical changes to the regulatory model for charity gaming. Specific to bingo, the feedback was for a radically different revenue split between charities and operators and far greater flexibility in terms of the types of gaming and prizes.

To restructure the revenue model the AGCO commissioned HLT Advisory to review the current model, and recommend a new system for Ontario. Last fall, HLT provided a comprehensive report with recommendations.

The AGCO reviewed the HLT report with industry representatives to finalize the new model.

The main features of the new revenue model are: • The AGCO will no longer dictate specific rules of play for every type of game. Charity licensees and hall operators will have the flexibility to develop new and exciting games with substantially larger prize boards.

• The 60/40 revenue split between charities and hall operators has been changed to 45 per cent for charities and 55 per cent for operators.

• In return for their larger portion of the revenue, operators assume responsibility for virtually all operating costs.

• Prize boards will be capped at a maximum of 70 per cent of wagering (over a quarterly period).

• Charities and operators will share marketing expenses of up to 10 per cent of the bingo wager (after prizes are paid).

The vast majority of the bingo industry wholeheartedly supports the new revenue model, including the OCGA and the two hall operator associations, the RGSO and the CGAO. But some critics have emerged among the bingo hall operator community. These critics contend that they should not have to share the revenue from their food and beverage operations with charities.

Previously, hall operators kept 100 per cent of any profits derived from their food and beverage sales. However, even the critics concede that 55 per cent of the overall revenue is a better deal for operators than the previous 40 per cent of gaming revenue.

The other main criticism of the new model is about the pace of change.

Some operators have complained about dropping their prize payouts to 70 per cent from the current 80-85 per cent range over the next two to three months. They say this is too much, too soon. They wanted a phase-in period of up to a year to gradually reduce prize payouts to avoid alienating their customers.

In response to these criticisms, the AGCO and other supporters of the new system point to the HLT report, which recommends a 70 per cent payout to ensure increased profits for all parties. Anecdotal reports from hall operators seem to support that conclusion. Hall operators acknowledge that it is challenging to reduce payouts to the 70 per cent range, but those that have are reaping the rewards.

According to one industry insider, the small but vocal group of critics is not seeking to scrap the new model at all. They are simply rehashing issues that have been already discussed, debated and rejected.

The charity and hall operator associations acknowledge that there were elements of the new revenue model that they would like to change; however they also agree that the new model is vastly superior to the old one. “As with any negotiated process, we needed to strike the right balance between operator and charity interests,” said Peter McMahon, CEO of the CGAO. “We debated issues vigorously among the working group members and the AGCO,” added Johnstone. “Did the operators get everything we wanted?

Of course not. Neither did the charities. But we all recognized that the new model was a heck of a lot better than the status quo.”

McMahon believes that the new model will help the bingo business recover lapsed players and create new ones. “This new system will allow us the game flexibility and stability in the market around prize payouts that will allow us to make bingo fun and interesting again, and allow us to grow the business for the benefit of all parties,” he said.

The new model has only been in place for a few weeks, so it is too early to predict the long-term effect for bingo in Ontario. But initial reports are encouraging. “We are very pleased that the AGCO has invested the time and resources to work with us to develop a new revenue system. Now we have the tools we need to compete and to grow our businesses,” Johnstone said.

“We won’t have a complete picture of the impact of the new model for at least six months, but I’m firmly convinced that we’re on the right track.”

Troy Ross leads the Gaming Practice Group at Hill & Knowlton Canada, whose clients include Delta Bingo. Prior to that position, he was the manager of policy at the AGCO

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Casino of

the Rockies

By Lisa Kopochinski

St. Eugene Mission Resort, which includes the casino, has breathtaking views and plenty of activities. But the early history of the site was not so pleasant.

Tucked snugly in a farm valley 10 minutes from Cranbrook, B.C., and framed by the Rocky Mountains and St. Mary’s River lies the St. Eugene Mission Resort and Casino of the Rockies, B.C.’s only aboriginal-owned casino.

While today the St. Eugene is a vibrant 4 ½-star resort that offers guests superb amenities and breathtaking views, the Mission is steeped in tradition with a heartwrenching history.

Painful history for the site; a financial reorganization for the resort In 1910, the Canadian government funded and constructed the Mission school, now part of the hotel complex. Operated by the Oblates of Mary Immaculate, this facility was the first comprehensive Indian “Industrial and Residential” school built in the Canadian West. From 1910-1970 the Mission instructed 5,000 children from southern Alberta, the Kootenays and the Okanagan.

The children were removed from their homes and communities for 10 months of the year and segregated at a highly disciplined school. They were prevented from speaking their own language and practicing their own religion in a misguided effort to get them to assimilate into white society.

The school was finally closed in 1970 when government policy changed to encourage public education for Indian 36 | June/July 2007

children. In 1973, the B.C. government leased the Mission with plans to turn it into a facility for the mentally handicapped. The building was stripped of historic fixtures and artifacts and, after $750,000 was spent on renovations, the project was abandoned.

The following winter, the pipes burst and the building suffered severe damage from flooding. For the next two decades, the building remained empty.

According to a 2002 story in the Globe and Mail, planning for the resort began in the early 1990s, after the property had been given to the Ktunaxa Kinbasket Tribal Council — an umbrella group of five Indian bands. The $42 million resort, which opened

in phases from 2000 to January 2003, was funded mainly by grants and loans from the federal government. The Council retained Delta Hotels to manage the hotel and golf course.

But the resort fell on hard financial times and by the end of 2003, had accumulated more than $30 million in debt. Under court supervision, the property entered into proceedings under CCAA, the Companies' Creditors Arrangement Act. Two First Nations bands from beyond British Columbia – the Samson Cree band of Alberta and the Mnjikaning band of Ontario, which owns Casino Rama, the country’s most successful aboriginal casino

St. Eugene Mission Resort, in the southeast corner of British Columbia, includes the Casino of the Rockies.

– came to the rescue. Together with the Ktunaxa Nation, they formed the SEM Resort Limited Partnership to buy the resort for $11.1 million. The court-ordered sale meant that unsecured creditors got nothing.

The alliance of the three bands, however, was a milestone in financial cooperation among the First Nations. Sophie Pierre, chief of the St. Mary’s band, which is one of the five bands comprising the Council, said this “is the largest partnership among First Nations from different parts of the country and is reflective of our desire to be a part of the growing and lucrative tourism industry.” As a child, Pierre spent 10 years at the Mission school.

Thriving resort with myriad of activities Today the resort boasts 125 guest rooms and 19,000 square feet of casino space. Guests can try their luck on 224 slot machines and 10 table games.

“As we are a smaller-destination casino, we do not have the higher limits you would normally see in the larger centres and Vegastype casinos,” explained Dallas Ferguson, general manager. “Therefore you could say that we do not attract what the industry would consider to be a high roller.”

While the Casino of the Rockies is the service provider, it is the B.C. Lottery Corp.

(BCLC) that owns the slot machines. Delta is no longer involved in managing the hotel

and golf course. The resort’s non-branded hotel is managed by the staff.

In addition to gaming, the list of activities at the resort is abundant — in both summer and winter. Through arrangements with outside suppliers, guests can be picked up at the St. Eugene for helicopter tours, fly fishing, lake fishing, river rafting, snowmobile tours, snowshoeing, mountain biking and hiking.

Downhill skiing is available 20 minutes away at Kimberley and Fernie, B.C. Golf is probably the most popular activity.

Marketed as “a masterpiece in an incredible setting,” the St. Eugene Mission Resort golf course winds its way through open link lands and rolling woodlands, with spectacular views of the St. Mary’s River.

To the east, there’s Fisher Peak. The Purcell Mountains lie to the west.

Opened in 2000, the 18-hole course — which has four sets of tees measuring 5,398 yards at the front markers to 7,007 yards from the championship tees — was cited by Golf Digest magazine in 2001 as one of the top three best new Canadian golf courses.

Inside, guests can check out the pool, fitness centre, hot tub, sauna and steam room or indulge in a massage or other aesthetic service at the Readman Treatment Clinical Day Spa. For those seeking to educate themselves about the area, the Ktunaxa Nation Council operates an interpretive centre within the resort that displays artifacts and details the history and mythology of the people who previously inhabited this area.

After a day of activities, guests can enjoy a meal at any of the four restaurants onsite that offer a full spectrum of culinary delights — from deli-style to fine dining.

Ferguson said the majority of guests are visiting for pleasure: “According to the BC Gold [BCLC’s casino player loyalty program] statistics, 52 per cent of our members are from BC; 38 per cent are from Alberta; and five per cent are from the northwest U.S.” And though the resort suffered financial difficulties in the past, Ferguson said it “continues to achieve financial growth in all areas. The expectation is that this will continue over the years ahead. Each year we enjoy more visitors.”

Lisa Kopochinski is a freelance writer based in Sacramento, California.

Canadian Gaming Business | 37

WTO Internet Gambling

Dispute Heats Up U.S. reacts to loss in Antigua dispute by saying it will change the terms of a 13-year-old treaty.

By Christine J. Mingie

The Internet gambling dispute between the tiny Caribbean nation of Antigua and Barbuda and the United States has taken some unexpected twists in the past few weeks and is likely to become one of the most complex trade disputes ever handled by the World Trade Organization (WTO).

38  |  June/July 2007

In May, after losing a final compliance decision in the dispute before the WTO, the U.S., in an unprecedented move, notified the WTO that it intends to withdraw a markets access commitment covering gambling from the schedule of services it negotiated in the 1994 General Agreement on Trade in Services (GATS). According to U.S. trade officials, the inclusion of gambling in its schedule of services was a technical oversight that it only discovered in 2003. A handful of countries, including Canada, excluded gambling from the list of services covered by GATS when the treaty was negotiated.

There is nothing to prevent the U.S. from modifying its service concessions to exclude gambling, but such a move would expose it to compensation claims by WTO members for lost trade opportunities arising from the change. It could also set a precedent for other countries that lose a WTO case.

Following the U.S. announcement, Antigua said it was considering pursuing all available remedies against the U.S. Chief

among these would be a claim for compensation for lost trade opportunities. Under the GATS compensation procedure, the U.S. must negotiate compensation with any WTO member who files a claim against it. If the negotiation is unsuccessful, compensation claims are resolved by arbitration.

Such negotiations, especially if they result in arbitration, could drag on for years.

In the interim, the U.S. is not permitted to deny market access to gambling services until it has paid compensation to WTO claimants.

If no member country submits a compensation claim, the U.S. may modify its service schedule.

It’s unlikely that no claims will be filed, however, because Antigua is already lobbying WTO members to initiate claims for compensation, in an effort to make the process as difficult and expensive as possible for the U.S. Antigua is also considering seeking permission from the WTO Dispute Settlement Body (DSB) to cross retaliate against the U.S. by suspending concessions under the Trade Related Aspects of Intellectual Property Rights

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Agreement. This agreement protects intellectual property rights and primarily benefits the pharmaceutical, software and entertainment industries.

Antigua hopes that withdrawing protection of U.S. intellectual property rights would have an economic impact on U.S. interests. Such a move could make Antigua a haven for traffic in pirated CDs and DVDs.

60 1946-2006

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Email: info@accro-acmechrome.com

305 McKay Avenue, Winnipeg, Manitoba R2G 0N5

Since 1946

Proudly Canadian

History of the dispute The Internet gambling dispute between the U.S. and Antigua has a protracted history.

It started in March 2003, when Antigua, through the DSB, requested a consultation with the U.S. regarding U.S. federal and state gambling legislation and enforcement measures that Antigua said prevented operators based in Antigua from offering Internet gambling services to consumers in the U.S. Antigua said these laws and enforcement measures were inconsistent with the U.S. service commitments under GATS, which were supposed to allow the cross-border supply of gambling services.

The dispute was referred to a WTO panel for resolution.

On November 10, 2004, the panel released its decision. Its key findings were that: the U.S. had specifically included gambling and betting services in its GATS schedule of services; several U.S. federal and state laws prohibited the cross-border supply of Internet gambling and betting services, contrary to the U.S. commitment guaranteeing market access, and were therefore inconsistent with GATS; and while the U.S. could have defended its prohibitive legislation by invoking the public morals exception under GATS, because the U.S. failed to consult with Antigua before implementing its legislation, it was precluded from doing so.

Neither party was happy with the result and both countries appealed the panel decision to the WTO Appellate Body, citing numerous errors of law.

The Appellate Body decision, released on April 7, 2005, upheld some of the panel’s findings, although for different reasons, and reversed others. It found that the panel erred in ruling that the U.S. could not invoke the public morals exception. It upheld the panel’s finding that the U.S. schedule of services included specific

40 | June/July 2007 Accro_Gaming_1_3v_Feb07.indd 1

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commitments on market access to gambling and betting services. It ruled that U.S. federal legislation was defensible on the public morals exception, except as it related to the Interstate Horse Racing Act (IHA), because there was a possibility that the IHA discriminated against foreign suppliers of Internet betting services for horse racing.

The U.S. appeared to have two courses of action available to it to remove the discriminatory application of the IHA – it could amend the IHA to ban Internet pari mutuel wagering on horse racing altogether, or it could allow foreign service providers to supply the U.S. Internet pari-mutuel wagering market for horse racing. The U.S. took none of those courses of action and instead it announced that, in its view, the IHA was inconsistent with existing U.S. federal prohibitions on Internet wagering and that it was investigating illegal wagering occurring under the IHA. As a result of the U.S. inaction, Antigua sought a compliance hearing decision to force the U.S. to bring its legislation into compliance with the Appellate Body ruling.

March 30 ruling: U.S. still out of compliance The compliance decision, released on March 30, 2007, considered new evidence that had not been before the original panel and re-interpreted the findings of the Appellate Body, but in the end it held that the U.S. was not in compliance with the Appellate Body ruling.

Now that the U.S. has decided to withdraw gambling from its GATS commitments, industry watchers will be monitoring the situation to see if the European Union or other WTO members, such as Brazil or China or India, file a claim for compensation against the U.S. If they do, it could end up costing the U.S. billions of dollars in compensation claims. U.S. trade officials, however, have said that no member country is entitled to compensation because they were on notice that the U.S. had very strong criminal prohibitions at the state and federal level on gambling.

Christine J. Mingie is a lawyer with Lang Michener LLP in Vancouver. She advises on gaming regulatory and compliance matters for a large public gaming company.

Ch e f Sp o t l i g h t

Ralph Deda

McPhillips Street Station Casino, Winnipeg

By Andrew Coppolino

S

Sitting behind a microscope peering at infinitesimally small particles helped Ralph Deda see the bigger picture of what his career path would eventually be.

Deda, executive chef at Winnipeg’s McPhillips Street Station Casino, took a Bachelor of Arts degree with a concentration in biology from the University of Winnipeg. He then found himself standing behind the stoves as a cook. He credits kitchen dynamics.

“I hated working at a desk, looking down a microscope and making slides for eight hours, but cooking is always changing. You never know when you come in what you’re going to be greeted with,” explained Deda.

He started in November 2004 as a seasonal cook at the casino. In March 2005 he was promoted to kitchen manager, and in July 2005 he assumed his current position.

Now 56, and after 30-plus years in the restaurant environment, Deda is greeted daily by the 45 to 50 employees he oversees as they create enough top-quality food for about 600 covers a day at the casino’s “Grill at Michele’s” restaurant.

Born in north-end Winnipeg, Deda received his formal culinary training at the Northern Alberta Institute of Technology in Edmonton

and apprenticed at the Edmonton Petroleum Club, one of the city’s premier private clubs.

He stayed on at the Club as a cook for his first job and eventually became chef tournant — a “swing” chef who can jump in to replace other station head-cooks.

The chef tournant’s varied skills and his experience cooking across Canada taught Deda that working with his kitchen crew is an allimportant part of his day. “The main thing is interacting with staff,” he said.

“When I was a young cook, I learned by trial and error. There were no courses on how to deal with people or how to be a manager. I brought the years of experience I had [here].”

As for the often hectic casino kitchen environment — part of the casino’s claim to the “bustle of old world life” — he and his staff handle daily, Deda finds little difference from any other high-paced kitchen: “It’s a case of handling lots of volume with our main thrust on the buffet. You just have to get used to increasing numbers.”

With each new day, whether it is eight or 16 hours long, Deda is concerned with motivating staff. Typically starting at 6:30 a.m., he relishes the time he spends guiding staff with their tasks while also encouraging creativity.

“They’re doing the job and may set up the menu for the day,” he said. “They can do the [creative] things that they want to do and bring the problems to me. I give them direction.”

Ninety per cent of the food that results from that creativity is prepared for the buffet in Michele’s, the multi-purpose restaurant. That translates to approximately 350 lunches and 300 dinners with the remaining percentage being the a la carte

menu. At its busiest, the kitchen will put out 1,000 meals daily.

Deda’s staff also creates gourmet wine dinners, along with special functions that might include a themed dinner for an aboriginal society. “It’s a fun ambiance that we sell along with the food,” he said. Simpler dishes include finger foods and sandwiches for the lounges, as well as meals for banquets, catering packages and a Sunday brunch replete with chocolate fountain.

The client demographic enjoying the food and atmosphere is broad, especially given Winnipeg’s diverse ethnicity. From a strong Native Canadian culture to Asian to Ukrainian, “we’re serving virtually across the board. We have to be something to everybody,” Deda said.

He is dedicated to sourcing local products.

Serving the strong aboriginal culture that helps define Winnipeg, the month of May, for instance, featured pickerel – a distinctive and indigenous Manitoba fish that is enjoyed throughout the province. Bison, Manitoba pork tenderloin, and wild-rice pancakes are other popular local dishes.

Deda is now adjusting his lens to focus on local talent, with plans for an apprenticeship program and training centre to develop a labour force from which his kitchen brigade can be drawn.

“We have really, really good quality for a really good price,” he said. “We try to fill out the experience: customers can game, they are entertained, and we try to make it a good dining experience for them as well.”

Andrew Coppolino, andrew@tablescraps.ca., is a freelance writer based in Kitchener, Ont. Canadian Gaming Business | 41

2007 Summit Profiles Accro Furniture The Accro Furniture Industries product display at the 2007 Canadian Gaming Summit featured nine custom chairs, each

designed for specific casino and commercial gaming applications. Table games seating included Blackjack, Baccarat, Roulette, and Poker, and there were also five newly developed slot chairs featuring lumbar support, ergonomic molded seat cushions, translucent powder coat finishes, and convenience rollers. The Poker chair illustrated on the left incorporates a ComfortFlex backrest support, generous size seat, and large diameter easy-slide floor glides for re-positioning with minimal effort.

Available with a wide variety of backrest shapes and upholstery fabrics, this new model has become a popular addition to poker rooms across the country. In its 61st year of manufacturing durable Canadian seating products for commercial business including casino, restaurant, and hospitality facilities, Accro Furniture Industries has gained a reputation for reliable customer service, and dependable on time delivery.

Accro Furniture Industries Division of Acme Chrome Furniture Ltd. 305 McKay Avenue, Winnipeg, MB R2G 0N5 Canada, Ph.: (204) 654-1114 Fax: (204) 654-2792 info@accro-acmechrome.com

Agilysys, Inc. Agilysys, Inc., a leading provider of innovative IT solutions and hospitality software solutions, announced it has completed its acquisition of InfoGenesis, a privately held, independent software vendor (ISV) and solution provider to the hospitality market.

At approximately $42 million in annual revenues, InfoGenesis offers enterprise-class point-of-sale (POS) solutions that provide end users a highly intuitive, secure and easy way to process customer transactions across multiple departments or locations, including comprehensive corporate and store reporting. InfoGenesis has a significant presence in casinos, hotels and resorts, cruise lines, stadiums and foodservice.

The company will be integrated into Agilysys’ existing hospitality solutions business.

The combined portfolio of products from Agilysys and InfoGenesis offers hospitality clients worldwide a single source for all their operational technology needs.

The acquisition will also provide Agilysys a competitive advantage with seamless integration between property management, POS, and inventory and procurement, in addition to its golf and spa management applications.

11545 Wills Rd., Alpharetta, GA 30004 • 800-241-8768 www.agilysys.com • agilysyshospitality@agilysys.com

Atronic Americas LLC Treasure Cats King Kong Cash™ • e-motion

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The game features exciting graphics and bonus rounds to encourage play.

Each bonus round builds more excitement. The Treasure Cats bonus is triggered by three Aztec Statue symbols on selected reels for six free game levels. The Mystery Kong Bonus can be triggered randomly after every base game, Three Free Game or King Kong Cash Free Game symbols on selected reels trigger the King Kong Cash Bonus. Players can choose an episode to earn up to 10 Free Games. One of four progressive levels can be won.

Atronic Americas LLc • 800-864-7670 • www.atronic.com © Atronic, 2007

2007 B.C. Poker Championships Calling all poker players!

British Columbia Lottery Corporation is proud to present the 2007 B.C. Poker Championships at the River Rock Casino Resort in Richmond, BC. This tournament has established British Columbia as a Canadian destination for tournament poker.

The 2006 B.C. Poker Championships welcomed a great turn out of poker celebrities such as Gavin Smith, Brad “Yukon” Booth, and the “Orient Express” himself, Johnny Chan. You just never know who you’ll be heads up against at the 2007 B.C. Poker Championships.

The 2007 B.C. Poker Championship features Texas Holdem’ Pot Limit & No Limit events, as well as a ladies only event and Super Satellites.

NOVEMBER 18-25. Mark your calendar! Registration for the 2007 B.C. Poker Championship starts September 1, 2007.

For more information on the BC Poker Series log onto www.bclc.com. For more information on the host property, River Rock Casino Resort, log onto www.riverrock.com.

42 | June/July 2007

BIOMETRICA VISUAL CASINO BIOMETRICA VISUAL CASINO software has become the new casino industry standard and is used by about 140 casinos and gaming agencies worldwide primarily to reduce their unnecessary losses to casino undesirables.

Significantly reduces losses; increases bottom line profit; Faster undesirables/VIP identification. Modules include: Surveillance Information Network (S.I.N.), Face Recognition, Private Database Enrollment, Casino Database of Undesirables, Existing Camera Video Capture and a new user friendly Incident Reporting module is coming 4th quarter 2007.

Biometrica also provides Instant ID Document Authenticators that don’t just scan but actually authenticate drivers’ licenses, passports, military IDs, etc., in just 5 seconds, to help stop underage gambling and drinking as well as deter identity fraud by revealing fake or tampered documents involving cashier transactions, credit markers, etc. Fingerprint scanning and other biometrics also available.

Very effective state of the art solutions for Self Exclusion / Problem Gambler Programs can be customized as required.

James M. Pepin, Vice President Sales and Marketing, Biometrica Systems, Inc., 2000 S. Jones. Blvd. #150, Las Vegas, NV 89146 702-870-6949 X 111 Office jpepin@biometrica.com

CUMMINS-ALLISON ULC Founded in 1887, Cummins-Allison is a North American manufacturer and supplier of high-speed money and bar-coded Casino ticket processing equipment including the JetSort® High-Speed Coin or Token Sorter/Counter, JetWrap® High-Speed Automatic Coin Wrapper, JetCount™ HighSpeed Currency Counters, Universal Single-Pocket JetScan™ Currency Scanner/Counter *, Universal Two-Pocket JetScan™ Currency Scanner/ Counter *, JetScan MPS™ High-Speed Multi-Pocket Currency and Casino bar-coded tickets Scanning, Sorting, Facing and Strapping system, JetScan™ Two-Pocket Bar-Coded Casino Ticket Scanner/Counter and the Casino Transaction Kiosk (CTK) self-service bar-coded ticket redemption system. All products sold are supported across Canada by factory-trained service engineers in our branch offices in Vancouver, Calgary, Edmonton, Regina, Winnipeg, Mississauga, Ottawa, Montreal, Halifax and St.John’s, Newfoundland. Casinos continue to count on Cummins to provide them with quality, reliable, rugged equipment backed by service which is second to none in the industry. * Universal Single-Pocket and Universal Two-Pocket JetScan™ Currency Scanners process Canadian and U.S. bank notes standard and up to eight additional country currencies optionally.

CUMMINS-ALLISON ULC, 6725 Millcreek Drive, Unit 3, Mississauga, Ontario L5N 5V3 Web-Site: www.cumminsallison.ca E-mail:

inquire@cumminsallison.ca Ph. (905) 814-6184 Toll-Free 1-800-499-6191 Fax: (905) 814-6182 Contact: Harry Patrinos, Managing Director

Interblock Interblock is the world’s leading brand of luxury gaming devices produced by Elektroncek d.d. Interblock has a strong global presence since our products are distributed through the network of: Interblock branch offices, Aristocrat Leisure Limited offices and independent distributors. The company is specialized in multiplayer electro-mechanic gaming devices (Roulette, Dice), Electronic Video Games and Special Gaming Projects, and strives to set standards of operators’ satisfaction, with highest adaptability to local technical and legal environments. This year, the 4th generation – named G4 ORGANIC – has been launched.

While G3 is still popular, we are presenting Megastar 8. This is a multi-player automatic version of roulette, which uses a real roulette wheel and ball allowing players to place bets through a keyboard or a touch screen. It is available in three versions: MEGASTAR, which is best-selling product, SUPERNOVA which is the most impressive of all devices in electro mechanic roulette family, and QUEEN which is designed to suit large gambling houses. More: www.interblock.eu More: www.interblock.eu

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Lottery and Gaming Corporation Highlights The following summaries of news and activities were submitted by the provincial lottery and gaming corporations. Look for reports from other provinces in the August issue.

British Columbia Lottery Corp.

Ticket raises awareness of climate change campaign Save Our Polar Bears, a new Scratch & Win ticket recently launched

by BCLC and WWF-Canada, raises awareness of WWF-Canada’s SaveOurClimate campaign, encouraging people to learn more about the impacts of climate change.

The $2 ticket features images of polar bears and, on the back, provides information on how climate change is affecting these majestic creatures and their Arctic habitat.

In addition to cash prizes, the ticket offers Polar Bear Adoption Kit prizes. BCLC “virtually” adopts a polar bear on the winner’s behalf from WWF-Canada and the winner receives a kit containing a stuffed polar bear made of environmentally friendly materials, an adoption certificate, and a brochure explaining why polar bears are threatened and how WWF-Canada is working to save them.

Proceeds generated from Save Our Polar Bears, as with all BCLC lottery products, are distributed to the Government of B.C. to provide funding for health care, education, social, community, charitable and municipal programs.

Toronto player wins first Johnny Chan tournament Toronto resident Henry Tran won the top prize of $325,000 in the NoLimit Texas Hold ’Em main event of BCLC’s first Johnny Chan Poker Classic. He beat out 499 players, including celebrity poker pro Johnny Chan, in the tournament held May 6-13 at River Rock Casino Resort.

Tran, a computer chip designer, made it to the final table with one of the highest chip counts.

Almost 1,700 players competed in the tournament that featured five events for a total prize pool of $2,165,000, making it one of the largest poker tournaments held to date in B.C. Visit www.bclc.com for the complete list of winners from each event.

Price is Right for lucky bingo winners Twenty-eight lucky B.C. bingo players won the opportunity to travel to Las Vegas to experience the live stage version of the longestrunning game show in TV history, The Price is Right.

As audience members, the winners competed for a chance to “come on down” to the stage to play games for great prizes.

44 | June/July 2007

Todd Newton hosts the live stage show at Bally’s Las Vegas Hotel and Casino. The visit by the bingo players coincided with the May 16 retirement of TV personality Bob Barker, who hosted The Price is Right for 35 years.

The 28 winners were rewarded with this opportunity after competing in a “showdown” with other winners of Ka-Chingo, the province-wide linked bingo game.

Alberta Gaming and Liquor Commission Social Responsibility The AGLC continues to implement social responsibility initiatives to reduce the risk of problem gambling. In 2006-07, the AGLC partnered with the Alberta Alcohol and Drug Abuse Commission (AADAC), the Federation of Alberta Bingo Associations and bingo hall managers to develop and implement the Bingo Industry Responsible Gambling Program.

The program was developed through focus group sessions with bingo workers, players and volunteers and includes “A Good Call,” a problem and responsible gambling THE ODDS ARE SOMEONE awareness training DEPENDS ON YOU program for bingo staff. Informational brochures and posters for distribution and display in all bingo halls accompany the training program. The Bingo Industry Responsible Gambling Program is being delivered to all registered bingo workers from April 15-July 31, 2007. Participants will evaluate the training and a formal evaluation of the program will be completed in 2008.

Planning is also underway for Alberta’s first Responsible Gambling Awareness Week, from Oct. 8-12.

Gambling should never be considered a way to make money.

Enjoy your gambling experience, but set a limit and stay within it.

Don’t gamble with money needed for necessities.

If gambling activities are causing problems for you or someone you know, call the 24-hour, toll-free AADAC Help Line at 1-866-332-2322.

AADAC© 2006 705F

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Casino Highlights • The Marketing Team at SGC has been honoured recently for its innovation and creativity. The unique campaign surrounding

Sponsorship Highlights • SGC was proud to contribute to a number of community events and organizations in recent months, including acting as presenting sponsor of the Oskana Cup Aboriginal Hockey Tournament, highlighting the best aboriginal hockey talent in Western Canada. Other sponsorships of note include the Juvenile Diabetes “Walk to Cure Diabetes” corporate recruitment luncheon, Canadian National Institute for the Blind

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Poker Highlights • The 11th annual Station Poker Classic was held at Casino Regina March 21-24, with 941 players from all over Canada and the United States. Over the years, the Station Poker Classic has grown from a $45,860 prize pool in 1997 to a total tournament prize pool of approximately $602,400 in 2007. Each day of the tournament was an individual event: winners were Danny Hall of Edson, Alta. ($20,315); Ted Timmermans of Beaverton, Ont. ($38,416); Hung Cung of Winnipeg, Man. ($44,402); and Linell Rossouw of Regina, Sask. ($56,279). Casino Regina looks forward to the Diamond Poker Classic July 24-29.

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Community Support-Alberta Lottery Fund Each year, thousands of volunteer and community-based organizations receive financial support from the Alberta Lottery Fund (ALF), which is the government's share of net revenue from VLTs, slot machines and ticket lotteries. This year, more than $1.4 billion of gaming revenue is expected to be transferred to ALF by the Alberta Gaming and Liquor Commission for distribution to 13 ministries and various grant-based programs and other initiatives.

SGC’s promotional sponsorship of Saskatchewan’s Rolling Stones concerts won the team a Gold Quill Award of Merit from the International Association of Business Communicators, recognizing marketing and business excellence.

• In April, Marketing struck gold again with the Gil Carduner Award (Budget Over $20,000) for its Odds campaign at the 18th annual Saskatchewan Tourism Awards of Excellence. A panel of 12 tourism professionals chose 46 award finalists from over 100 submissions in 16 categories. SGC was also honoured as a finalist in the Service Excellence (Business) category.

• This spring, SGC honoured its own with a Five Star Awards gala, a special night for Casino Regina and Moose Jaw staff to be thanked for their commitment to guest service excellence. The evening included gourmet refreshments and live entertainment, as well as recognition of long-serving staff and the presentation of four awards.

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Casino Highlights The Enoch Reserve’s River Cree Resort and Casino opened on Oct. 26, 2006.

Since then, Me’Chet Charities Limited has received approximately $9.6 million in charitable gaming revenue for distribution to housing, education, infrastructure, life skills, addiction treatment, community kitchen and food bank programs to enhance life on the Enoch reserve.

The AGLC and AADAC also worked together to open the province’s third Responsible Gambling Information Centre (RGIC) in the Enoch River Cree Resort and Casino in February. RGICs provide patrons with AADAC support and services, and information about the financial costs of play, house advantage and Alberta’s Voluntary Self-Exclusion Program. Five more centres will open this year with the goal of having RGICs in every Alberta casino by 2009.

The opening of the Camrose casino has been delayed two months – to June – because of Alberta’s hot economy, which has resulted in a skilled labour shortage. Several other casinos are expected to open this year: • Cold Lake First Nation – August • Tsuu T’ina First Nation (Calgary) – October • Stoney Nakoda First Nation (Kananaskis) – December • Alexis Nakota Sioux Nation (Whitecourt) – December

:2 0 0 0

Canadian Gaming Business | 45

Visions Luncheon, and the Moose Jaw Hospital Foundation Family First Radiothon. Casinos Regina and Moose Jaw are committed to serving those organizations that make their communities better places.

Manitoba Lotteries Corp.

Casinos of Winnipeg • The Casinos of Winnipeg continue to add to the total entertainment experience with the opening of Jaguars Dance Club. Located in the Amethyst Room at Club Regent Casino, Jaguars is Winnipeg’s newest dance and live music venue, featuring a variety of musical styles, from ballroom to big band, and Latin to polka.

• In response to player demand, the Casinos of Winnipeg launched new Texas Hold ’Em Bonus table games on May 20.

Responsible Gaming • The first seminar entitled “Responsible Gaming: Putting the Pieces in Place” was held in Toronto April 23-25, just prior to the Canadian Gaming Summit. The program was put on by the Canadian Gaming Centre of Excellence in conjunction with the University of Nevada Reno. Participants received credit for the Gaming Management certificate at the University of Nevada Reno. The three-day program received rave reviews for its engaging content and highly interactive format. The program was developed by Bev Mehmel, Manitoba Lotteries’ Director of Responsible Gaming,

and was co-facilitated by Bev and Don Ward from the Addictions Foundation of Manitoba, both of whom have extensive problem gambling and responsible gaming backgrounds.

Corporate • For the fifth successive year, MLC was recognized by the Human Resources Management Association of Manitoba (HRMAM).

Having previously recognized MLC for the French Language Services program, corporate Human Resource practices, the ESL program and the Mentoring program, HRMAM awarded Manitoba Lotteries with an Award of Excellence at the March ceremony.

Community Support • MLC continues to reach out to our communities with sponsorship of numerous events, including: • Canadian Cancer Society’s Relay for Life (May–August) • Manitoba Marathon (June) • Cool Jazz Winnipeg Festival (June–July) • Winnipeg Folk Festival (July) • Manitoba Stampede and Exhibition (July) • Folklorama (August) • Habitat for Humanity Build (August) • Manito Ahbee Aboriginal Festival & Aboriginal Peoples Choice Music Awards (November)

A Winning Philosophy.

The fundamental goal of the Canadian Gaming Association is to create balance in the public dialogue about gaming in Canada.

Our members are the largest and most established gaming operators, suppliers and gaming equipment manufacturers in Canada, including provincial lottery corporations, casino and race track operators, and makers of slot machines and other related equipment.

Our mandate is to create a better understanding of the gaming industry through education and advocacy. Visit our web site at www.canadiangaming.ca and find out more about who we are and what a CGA membership can do for you.

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46 | June/July 2007

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“Where the Canadian Gaming Industry Meets”

12th Annual Canadian Gaming Summit

April 29 – May 1, 2008

Photo courtesy of Tourism Montréal, Stéphan Poulin

Palais des Congres, Montreal, Quebec

Don’t miss Canada’s leading annual trade show and conference for gaming professionals involved in casinos, provincial lottery and gaming corporations, race tracks with slots, First Nations gaming, charitable gaming/bingo, internet based gaming, finance & investment and legal and regulatory aspects of the industry.

Mark your calendar today!

For information on exhibiting or sponsoring, please contact Chuck Nervick 416-512-8186 ext. 227