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September 2012
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Over 600 customers were in line for the recent grand opening of the new H&M store at Stone Road Mall. The 15,000 square foot space will employ approximately 30, with a mix of managers, full and part-time employees. H&M is about fashion and quality at the best price, giving people the opportunity to dress to their personality. The full concept store has something for the whole family. (Photo by Natasha Persaud, Venture Guelph Publications Ltd.)
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We’ve read the articles–the McGuinty government and the Ontario Lottery and Gaming Corporation (OLG) have announced the cancellation of the Slot at Racetrack Program. We’ve seen the signs on lawns–55,000 jobs to be lost across Ontario. With Grand River Raceway just down the road in Elora, how will this affect the residents and businesses within our communities? The Slots at Racetracks Program (SARP) was an agreement between OLG and 17 horseracing tracks across the province. With gaming already present at the locations, the government saw the introduction of slot machines at the racing venues as a perfect fit. Slots were first established at racetracks in West Virginia in the early 1990s and studies showed that there was a 20% to 30% reduction in horse wagering revenue at the racetracks that also housed slot machines. This knowledge was considered, along with capital costs, when SARP was first
introduced in Ontario in 1998. Described recently by the government as a subsidy, the program was in fact a partnership between the government and the horseracing industry. Racetrack owners and the horse groups received 20% of the revenue from the slots for hosting the machines, while the local municipality received 5%. “We are constantly reviewing programs,” says Liz Sandals, MPP for Guelph. “Provincially two-thirds of the revenue at racetracks is coming from the slot machines and one-third from the horseracing. Prior to SARP, 100% was coming from wagering on horses. You will not find another private business where two-thirds of the revenue comes from government funding. In business you need to have a viable business model and to have two-thirds coming from SARP is not viable.” “Other government programs with schools or hospitals have accountability as to how the money will be spent. The accountability rules with race-
tracks are non-existent,” adds the MPP. “For the SARP program to continue to work, we would need to beef-up the accountability. At this time however, the transitional panel has recommended the government not continue with the program. Many of the racetracks have become dependant on the slot money. There needs to be a transitional plan for this industry and perhaps a new smaller program. The transitional panel is looking at potential revenue streams moving forward–it might be slots, it might not.” Locally, Grand River Raceway employs 280 people–160 slot employees and 120 Grand River employees, a combination of full, part-time and seasonal workers, with yearly wages and benefits totalling $8 million. The facility alone brings $2 million to the community through goods purchased, and over $600,000 people visit Grand River each year. Between 2005 and 2012 the municipality of Centre Wellington received $11 million in revenue from the slots
by Heather Grummett
at Grand River, with 100% of the funds allocated towards infrastructure projects. With 407km of roads in the County and 104 bridges, of which 34 bridges are in critical need of repair, the revenue from slots has had an enormous impact to local communities. Across Ontario, nine cents on every dollar from the municipal tax base stays within the municipality, with the majority going to the government. In Centre Wellington three cents of the nine is allocated to capital projects. Over the last seven years in Centre Wellington, the 5% slot revenue agreement has made up 45% of the expenditure budget for capital projects. “We didn’t put any of the slot revenue into operating costs, so the loss of the slot program will not affect taxes. However, we won’t be able to move forward as soon as we hoped on many of our capital projects,” says Mayor Joanne Ross-Zuj, Township of Centre Wellington. – continued on page 13
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