Use the hammer on Great Canadian Casinos

City Council has allowed the company to ride rough over citizens; it could instead show the company the door

by Kevin Potvin <kpotvin@republic-news.org>

Vancouver City Council in 2004 went against the opinion of a majority of polled citizens and allowed Great Canadian Casinos to open 600 slot machines at its Hastings Park site. It did so only on the condition that Great Canadian provide citizens with substantial mitigation of the inevitable problems the huge casino would bring, and share with them substantial benefits drawn from the enormous profits the casino would earn in the public park. It seemed a fair deal far all, and Great Casino signed on.

What they’ve come back with, according to their presentation to City Council last week, are vague promises to provide limited mitigation sometime over the next 20 years, and benefits to the nearby communities amounting to something like one half of one percent of profits.

Where the City indicated to citizens an underground 500-stall parking garage would be built over which green park space could be restored according to the original vision of Hastings Park, instead Great Canadian is offering what appears to be expanded surface pavement for parking, and less restored green space. The City implied to citizens the deal for allowing Great Canadian 600 slots would provide citizens and their children with a safe and convenient overpass structure allowing access to the waterfront New Brighton Park immediately to the north; instead the company is offering to partially cover the costs of street paint sometime in the next 15 years.

Where the City demonstrated how Great Canadian agreed to make significant investments to keep hugely increased traffic off residential streets and steer it around to entrances off an existing freeway to the site’s east, instead the company is offering to open up two major entrances for cars straight off the residential streets that were supposed to be protected. Where the City promised citizens the deal to allow slots at the people’s own park would generate substantial new investments into community services and amenities, instead the company is offering eight free movies a year shown outdoor at the horse track, a few nights a year during which charities can use the site on non-racing days for fundraising events, and $150,000 in payments to charities and the City.

Still, City staff are recommending that Council accept these paltry offerings as sufficient mitigation and community benefits as envisioned by the Council the day it approved the permit to allow 600 slots on a public park. Other benefits emphasized by the company include only items that are necessary to the company’s expansion plans. A much-touted day-care facility must be built anyway by the company for the benefit of the horse people using the Hastings Park facility, as the general manager at Hastings Entertainment told me. A horse grooming school often cited by company personnel as another great benefit to the community, is also instead a benefit to the company.

Even the learning center promised by the company and in fact a benefit only to the company, is not being financed directly by Great Canadian Casinos, but instead is to be financed with a $10,000 legal settlement the company recently achieved with David Mahmood of Allegiance Capital in Dallas. Great Canadian sued Mahmood for libel in connection with a failed Hong Kong cruise ship casino the companies together invested in. That failure recently cost Great Canadian about $1.5 million to settle a suit launched against it by Allegiance.

Great Canadian is hoping to complete the deal with City Council to allow it to begin earning something like $250 million extra revenue in a public park over the next five years. Why would City staff recommend that Council accept their slim offerings? Corporate extortion aided and abetted by a provincial government hostile to the City is why.

The Province recently fixed legislation that now allows casino operators to move away from the locations where they had originally acquired a license to operate. Table-game casinos in Vancouver earn the City coffers about $3.5 million a year. All the companies that operate those casinos have indicated they will take advantage of the provincial government largesse and move out of Vancouver to surrounding municipalities unless the City allows them also to operate slot machines. If City Council had rejected slots for Vancouver, as a majority of polled citizens had wished, city coffers would have suffered a $3.5 million loss per year. Instead, slots at Hastings Park are expected to bring the City $6 million in legislated commissions; slots elsewhere in the city could triple that income to $18 million.

The only reason Great Canadian seems to have the City of Vancouver over a barrel is because the City Council fails to use its imagination. Great Canadian would like to use a public park to generate private business profits and the City has already agreed that that concept is fine. But is a slots-infested casino and tired old horse track the best employer and City revenue-generator Council can imagine for that vast, open, waterfront and mountain view park sitting about as central to Greater Vancouver as any property in the city itself can be?

If we accept that a glorious, centrally-located, and prime-view public park is going to be turned over to a private company for the purpose of generating private profits in exchange for some dubious community benefits, some jobs for citizens, and some direct revenues for City coffers, then surely there are other business ideas to consider. What, for example, would a combination condo tower and shopping mall overlooking the ocean bay and the north shore mountains on that site generate in annual leases and other taxes and fees for the City? I expect it would be more than what the City can get from a slots and horse track operator. As to community benefits, such an operation would provide no doubt as many if not more jobs, would take up less of a footprint on the park site, and the developers would likely see a greening of the park and good access to New Brighton as a company benefit they would naturally be inclined to invest in.

The City can zone property as it wishes and it can issue or not permits as it chooses. It can also sell land it owns, or lease it out to whomever it pleases. We are the landlord, the company is the tenant; in my experience, it is always the landlord who has the power. The question is not whether the City has the power over the company; the question is whether it knows how to use its power.

It would be refreshing to see City Council behave more like the board of a private company and use its hammer to the benefit of its shareholders when it is in a position to do so. The City owns the land and it sits on the total and exclusive right to say what anyone can do on it. If Great Canadian Casinos does not wish to play ball with the City and its citizens, there is no shortage of other businesses who would happily give what we want in exchange for the right to build and operate on a site such as that one.

What the City Council needs to consider when weighing the offerings of Great Canadian Casino is lost opportunity costs: what revenues and benefits are the City and the citizens not getting as a result of allowing Great Canadian Casinos to operate slots on the City’s property? It could be losses in the millions.

Someone should tell the buckaroos at Great Canadian Casinos that they aren’t the only game in town. They either cut us in for a better piece of the action or get off our turf. From what I understand about the background of the company executives, that’s the kind of language they’re familiar with and will understand.

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