Frances Bula header image 2

New Vancouver casino would get $130 M more from local gamblers, $100 M from tourists

February 24th, 2011 · 95 Comments

B.C. Lottery Corporation, Paragon Gaming and PavCo are about to come out of the blocks to start fighting back against the opposition to a casino expansion that suddenly blew up in their faces the last two weeks.

That’s what I learned when I went over to BCLC’s offices today for an interview with the president I’d set up earlier in the week. Another twist to what is becoming a roller-coaster ride for the casino-expansion approval that Vancouver city council has to decide on sometime after the public hearing starts March 7. (With 120 speakers registered, my cautious bet is that it will go for several nights.)

So expect to hear a LOT more from the proponents to combat what the group Vancouver Not Vegas has been doing so skilfully, which is putting out information and marshalling supporters to their cause.

I went to the interview mainly intending just to ask: If the casino expansion isn’t passed, what will that mean? I got a lot more than I expected, including all of this.

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  • S Garossino

    All projections provided by PavCo derive from Paragon Gaming’s estimates, which have not been independently audited or reviewed.

    Why has PavCo not ordered an independent audit and review of all its figures, and why has the City Planning Department not sought that verification for a project of this scale?

  • Morry

    @Michelle
    Well I voted for him in 2008 . Will do it again if he runs.

    And if Bula is Vision friendly… fine.. .we can change her mind. 😉

    But in the meantime Mr Ladner is standing up is speaking out against the Mega Casino. Vision? not so much.

  • Morry

    “To quote Bing Thom once more: this is the wrong plan for Vancouver, promoted by the wrong people, for the wrong reasons.”

    and therein lies the big problems!

    And in complete agreement with the UGLINESS of the new roof. Who came up with that mess? And even more pertinent … who approved it? U G L Y !

  • Mira

    Morry @52
    Common Morry, cut the propaganda THOUSANDS of people are speaking up against the Mega casino not only Ladner. OK? Think about what Michelle said…

  • mortgaged future

    One of the ‘justifications’ for this proposal, and correct me if I’m wrong, is that it’s going to once again ‘fix’ the funding problem for the arts community. How many times have we heard that mis-guided promise?

    I have a problem with justifying a ‘wrong’, gambling, to achieve a ‘right’, arts and cultural programmes. Perhaps we need to take another look at where our civic incomes come from and go, and how they are distributed and spent. Another option to consider might be for gambling revenue to go into general revenue, and for the so called non-essentials (“non-core” in Ballem speak — another mis-guided notion) to be allocated a secure proportion of the annual budget. In this way Council and the public would not be held hostage to ethically, and possibly future financially bankrupt proposals such as the latest, bigger is better Paragon one.

  • F.H.Leghorn

    @Sean: “We shut down all of the gambling dens in Chinatown within living memory…”.

    You need to get out more. As Roger will no doubt assert, the Chinese have turned the entire world economy into a gambling den. You don’t overturn 6000 of cultural tradition with a by-law. Visionistas are learning that the same thing applies to Canadian cultural traditions.

    It’s funny to hear politicians condemn casinos and then watch them go begging for campaign contributions in order to bet everything on an election.

  • F.H.Leghorn

    6000 years of cultural et cetera.

  • Walrus

    Seems like Podmore, Grayden all the BCLC brass are all in it for themselves and we get screwed. Someone needs to stand up to them. Vancouver doesnt need to be bullied by Liberal insiders. Campbell toadies and fatcats. Maybe the new Liberal leader will put the brakes on things

  • Otis Krayola

    @Walrus 58

    Maybe pigs will fly.

  • The Fourth Horseman

    @ Mira #54

    This issue transcends mere politics and across every real and imaginary “line” in this city.

    People love this city. We share common values, regardless of our politics, regardless where we live.

    A Vancouver built on this illusion of “easy money” from an expanded casino, will be a Vancouver forever changed. And not for the better. There is always a great cost to a place–socially, culturally and financially—when the big casino rolls into town.

    Please go to vancouvernotvegas.ca and check out some of the supporters.

    Become a supporter yourself by signing the online petition, sending an e-mail to Mayor and all councillors and showing up at City Hall on March 7 to support those who are speaking against this expansion of the casino.

  • Lewis N. Villegas

    Thank you Sean Bickerton 46… Here’s my letter to Mayor & Council:

    Mayor and Council,

    I am writing to oppose the proposed casino on False Creek. I oppose the expansion of gambling in our community.

    I support scaling down casino gambling in our city to one central location. A revenue sharing deal with Richmond could make that one central location Bridgeport.

    I believe the associated problems with casinos are well known. The City Managers own report of 1 february this year showed how the origin of homelessness is more often than not graduates from government programs.

    Let’s put the focus on doing a better job helping Canadians, not putting them in harm’s way.

  • Bobbie Bees

    Ummm, Sean, the province doesn’t require the approval of the City of Vancouver at all.

    Quoted from the Vancouver Sun:
    “The province won’t use its senior government powers to overrule Vancouver if the city rejects B.C. Pavilion Corp.’s application for an expanded casino, PavCo chairman David Podmore said Friday.

    Podmore said the BC Place Stadium renovation is being done under provincial authority, meaning it doesn’t require municipal approval and could ignore any land-use restriction put in place by the city.”

    Read more: http://www.vancouversun.com/Province+challenge+city+over+PavCo+plans+casino/4352591/story.html#ixzz1F7lV3tTj

    So, even though at first Podmore states that the province won’t override the city, he goes on to further clarify that the province really doesn’t have to give a flying fig as to what the city wants.
    How much you wanna bet that even if the city rejects the casino, the province will just go ahead anyways?

  • Bill McCreery

    Well said 4th horseman. And well said again to Mayor and Council, Lewis.

    This is another historic time to define what we, as Vancouverites, are. The last time was the freeway debate in the early 1970s.

    This City, Vancouver, is not selling out the lives of our citizens and the well being of our families to allow profit for foreign owned companies. It is also not selling the well being and health of our neighbourhoods to the short term profits of developers and the 500 year plan of an alien political philosophy.

    The people of Vancouver will speak and be listened to, either in the immediate term or in the slightly longer term.

  • Norman

    I understand that BC has among the lowest payouts on slot machines in North America and the highest commissions to casino owners. If this is true, and I have done some checking that confirms those stats, then we can see why the pressure is on from all sides (except the public) to approve this development.

  • Morven

    Paragon and their real estate allies seem to have been skillful in assembling a coalition where they have merged the support of the government regulators with some trade union allies who contend that their views are the correct definition of the public interest.

    Alas, it is now abundantly obvious that the provincial and Vancouver citizens views of the public interest are quite different in the matter of the casino proposal.

    A moment of truth for VISION.

    Do they accept the view of the public interest advanced by the casino special interests (some of whom may be VISION supporters) or listen to the concerns of citizens who are neither VISION supporters or are allied with special interests.

    Either way may spell political disaster but VISION have one last chance to clarify just what they stand for. Forget bike lanes, forget the Village, this is their moment of truth.

    My view.
    -30-

  • “I understand that BC has among the lowest payouts on slot machines in North America and the highest commissions to casino owners.”

    It can be stressed enough that the win rate is controlled by the slot owner. Unlike the old mechanical slot machines, where the mechanism was truly random, or a card game where the shuffle introduces chance into the equation, slot machines aren’t random. It’s hard to imagine anyone with a lick of sense would bet against a computer.

  • ‘can’t be stressed enough’

  • Bobbie Bees,

    The article you link doesn’t state that the province can override the city for licensing a casino operation at the site.

    Land use and licensing are different items.

  • The Fourth Horseman

    Geez, Keam,

    It’s about time you showed up! LOL.

    Bikes and slots don’t mix, as per what we want Vancouver to be.

    Tell all at VACC. vancouvernotvegas.ca

  • The Fourth Horseman

    Bobbie Bees #68.

    You are correct.

    While PavCO’s story changes daily (on financing, on viability of whole development without the casino, etc) and they now make noises about how they will listen to the will of City Hall, what is really going in that relationship? What will Vision have to give up to keep local voters happy? How hard are the Prov government and PavCO pushing?

    Maybe the Christy connection will make better realtionships at City Hall. Maybe those extra homeless housing units needed needn’t come with quite so many strings attached? 🙂

    And, since City Hall is now hearing from taxpayers/voters, they know what could happen in November if theybobble this one.

  • Max

    It will be interesting.

    An article quoted Robertson as saying he is not asking the Vision Councilors to toe the line, but to vote their conscience. (not exact words)

  • @ Bobbie Bees #62 & piker #49

    Mr. Podmore is trying to confuse you by conflating zoning authority – which the province can supercede – with gambling license approvals, which only the city has the legal authority to issue.

    Contrary to his assertion, the province has no power to override city decisions on gambling licenses within city limits.

  • Walrus

    All the more reason for council to listen to the growing wave of opposition, and call a time out, otherwise this looks like another ‘done deal’. Clean out the head offices at bclc and pavco and put some professionals instead of party hacks in charge.

  • The Fourth Horseman

    PS

    From Surrey Leader columnist Jeff Nagel this Friday:

    http://tinyurl.com/4dasjaw

    Regardless of what BCLC head Micheal Claydon says, other Metro Van mayors saying “thanks, but no thanks” to being pitched casinos and/or expanded gambling in their munis.

  • Otis Krayola

    @ Fourth 74

    Thank you for the link, and I hope others here read it.

    What’s clear is that the mayors of other jurisdictions have said ‘no’ to casinos.

    But, wait till the residents of those cities hear the Good News that the CEO of the BC Lottery Corporation has for them! Community Gaming Centres.

    What could be more wholesome?

    A skunk by any other name still creates a stink.

  • The Fourth Horseman

    @Otis (how I love that name) #75

    Now, those are “Family First!” values we can believe in!

    LOL!

  • Morven

    Sean Bickerton # 72

    This is perhaps a question a city lawyer might be able to answer.

    There is already a casino licence in existence (I think) for Edgewater. Are they entitled to upgrade the number of slots without going back to the city or does amending a licence constitute a new application, requiring a public hearing.

    Perhaps the city can answer that question and save us a lot of frustration and anger.
    -30-

  • Max
  • @Morven #72
    Hi Morven, its worth noting that the existing Edgewater Casino was already the combination of two previous casinos, and this proposal is triple that size again to encompass two football fields full of 1500 slot machines.

    But every new slot machine and gambling table license has to be approved and issued individually by the city. And that authority is inviolable.

  • The Fourth Horseman

    @Max #78

    Thanks, Max, I posted Jeff Nagel’s article, too.

    Don’t know about Maple Ridge with a casino. I do recall years ago that Swan-E-Set Golf Club out in Pitt Meadows was supposed to become a destination golf club. It never did.

    The fact is that 90% of casino gamblers in the US come from within a 45 minute drive from home. Any muni putting in a casino in Metro Van is only looking at stealing current market share from other establishhed facilities. Perhaps this is the reason that BCLC currently subsidizes casinos in BC to the tune of $40 million dollars per year.

    I am also interested to see that Mr. Graydon of BCLC makes claims about the welcome mat being rolled out in Port Moody and Surrey for casinos.

    According to this article, Mayors Trasolini and Watts are saying, “Um, not so much”.

    They know what Vancouverites already know—the benefits from an expansion of gambling in any city are greatly exaggerated, with downsides like the costs of more crime, more addiction and more social problems in and around surrounding neighbourhoods rarely mentioned. You certainly never see the associated costs of such problems listed anywhere in all the happy marketing material handed out by Paragon and PavCO.

    Mr. Graydon’s BCLC, as both REGULATOR and MARKETER, a clear case of conflict of interest, cannot manage these problems in his current portfolio of casinos.

    Casinos appeal especially to the local gang and drug trade who LOVE to launder loads of dough through them.

    I recently had a conversation with an ex RCMP who now deals in money laundering issues for a private clientele. He says that casinos are the best places to launder money—precisely because they accept large amounts of cash.

    Mr. Graydon has the distinction of being the head of the FIRST government agency in this country that has been fined by FINTRAC, the federal watchdog that deals with the troubling problem of money laundering and proceeds of same to local gangs and international terrorist organizations.

    In 2010, BCLC was cited for not filing over 1,000 reports on people who brought in very large amounts of cash or convertable casino chips into BC casinos—in excess of the $10,000 ceiling imposed by the feds. In turn, BCLC was fined over $600,000 of your tax dollars for this ineptitude.

    By the way, BCLC also runs online gaming as you know (they never miss an opportunioty, di they?). And cleverly, it skirts those federal reporting laws and the necessity of being a watchdog on crime for us all by limiting online gamblers to—are you ready for it?– a daily limit of $9,999.00. That by the way, is the new limit. It used to be about $150 per day.

    Your government—encouraging crime, while robbing you blind.

    I have zero confidence in BCLC, with its bloated budget, it’s proven inability to deal with organized crime and its come hither come-ons to many people who are already problem gamblers or those who are “at risk”.

    I also have no confidence in the constantly shape shifting numbers given out on how the expanded casino NEEDS to pay for new BC Place roof, and why it is also necessary to the property development proposed for the area. If the costs of developing property were such a problem here, I guess we would see slots at every condo development.

    And if the development itself is such an iffy proposition that its success rests on the needs of an expanded casino to support it, I question the whole PavCO business model in the first place.

    Our tax dollars are on the hook. Again.

  • David

    Deloitte’s Oct. 2010 study of the Edgewater expansion shows $16.9 million a year in government revenues being given back to Paragon as part of the B.C. Lottery Corporation’s program to upgrade casino premises. This is public money being used to support a private development competing with existing hotels.
    Casino proponents are notorious for over-estimating revenues. When sots were first proposed at Edgewater, the city was promised $10-12m in annual revenues. Instead it has been getting just over $6m. For city revenues from Edgewater to jump from $6.2m today to the $17.2m being promised, business at the Edgewater’s new location would have to increase by 180%. When Burnaby’s Grand Villa Casino did a similar redevelopment, located in a far stronger local market, its business increased by just 6%. I hope City Hall is not as gullible post Millennium Fortress disaster. This casino proposal stinks,

  • The Fourth Horseman

    Sorry, all, this was just sent to me.

    FOI through The Tyee.

    FACT: governments everywhere addicted to gambling revenue continuously need to add “new” casinos, games, etc. to keep the public interested.

    The expanded casino is the next “pump and dump” in their arsenal.

    http://tinyurl.com/4tdkden

    Do visit the new url for Vancouver, Not Vegas! at vancouvernotvegas.ca to register your concerns.

  • The Fourth Horseman

    @ David #81

    Thanks, for that.

    BTW, the Deloitte report is NOT a feasibilty study by them.

    It is a report based entirely on numbers provided by—Paragon.

  • Ron

    I guess it’s back to “no fun” city.

    I’m just hoping that the Province doesn’t pour millions into a new Art Gallery.

    At least if the casino goes belly up, the space can be re-purposed into a PavCo trade & convention centre (to replace the medium size venue previously housed where UBC Robson Square is located) with a couple of hotels on site.

    An Art Gallery? That would be a “cultural institution” that would have to be propped up for years and years.

  • I can see pros and cons to both sides of this project. However, if it is to be approved because of the tourist dollars it will bring in, then I hope the city will ensure that the hotel rooms are completed as part of the initial project by making completion of the hotel rooms a condition of the issuance of the Occupancy Permit for the casino.

  • S Garossino

    Those tourism figures should be very closely scrutinized.

    Paragon Gaming, which operates small market casinos, has no experience in developing a major urban international tourist destination, let alone one marketed to a distant foreign market with much more attractive and closer (to them) alternative gambling destinations than Vancouver.

    Anyone who has ever set foot in the Marina Bay Sands in Singapore (with its acres of Chanel, Dior, and Versace shopping malls) would question what would possess Vancouver to think it can impress that foreign market with a casino at BC Place. Here’s their website: http://www.marinabaysands.com/

    You’d have to be higher than James Franco at the Oscars to think this is an easy market to enter.

    Yet Paragon Gaming projects a 77% occupancy rate in year 3–several percentage points higher than the highest occupancy rate in any major urban market in Canada since 2004.

    The River Rock Casino, which would seem to have the jump on the Edgewater in terms of attracting tourists from certain major international markets, still achieves only limpid occupancy rates. It is the local market and not tourism that drives the success of that casino.

    It’s too late for an independent audit and review. All of that should have been done months ago. But why was one never commissioned–either by PavCo or the City?

    This is a fiasco.

  • Walrus

    Looks like both NPA Anton and Vision are ready to take one for Gordon Campbell on his way out the door, with the head office hacks of bclc (know your limit, LOL) and pavco and city hall bureaucats in tow. Good thing at least it’s a civic election year … some might remember that and get a spine by March 7th. Otherwise the city is going to become the latest BCLC sewer for money-laundering by gangsters and shady backroom deals … how do they sleep at night?

  • The Fourth Horseman

    Michael, can you please tell us which tourists, from which countries will make a it a point to make a special trip to come come to a “destination casino” in Vancouver?

    Hmmm. Interesting observation about the hotel rooms.

    Are you suggesting that there might be another plan for those hotel rooms?

  • Lewis N. Villegas

    “I can see pros and cons to both sides of this project.”

    Geller

    I can too. My problem, Michael, is that I can’t seem to extricate myself out of the mess that the cons would create. A little bit of revenue—relatively speaking—for a dump-full of pain?

    Now, which one should citizens really choose?

  • tf

    You were right Frances. Here comes the marketing spin –

    Man I hate this way of development. These guys think we can’t read or don’t know our own thoughts or can’t understand the impact. Now they’re going to spin it for us so they can tell us what to think!!!

    Makes me wonder if the City hearings were postponed to give BCLC, PavCo and Paragon enough time to launch their PR campaign. And the MSM are used for the spin cycle.

    This is a familiar way of governance – think the HST.
    The decisions are made in the back rooms, the public objects, we’re told we only disagree because we don’t understand and then they tell us why they’re right. There’s got to be a better way!

  • Ron

    If Paragon wants to try its hand at a larger casino – that’s the nature of business in general – let them have a go.

    Businesses come and businesses go.

    Anyone remember a massive failure called STORYEUM that the City of Vancouver touted as the saviour for Gastown (in a City of Vancouver owned building with custom “world’s largest” elevator?)

    Hmmm – what’s in that space now? Anything?

  • Morven

    Enough of this paternalistic approach to the casino application.

    A well run casino company should have a well developed risk assessment approach whether it is for internal compliance with legal requirements or external assessment of political risk.

    What we seem to have is Paragon placing undue reliance on government agencies to ‘own’ the risks involved in locating and running this particular casino.

    Not an appropriate way to run a high risk business.

    Why are our elected representatives so keen to have the electorate directly and indirectly shoulder the risks and the costs of this application ?
    -30-

  • In response to Fourth Horseman #88, I suspect that a major destination casino could appeal to both Americans coming to Vcr (since Casinos are not allowed in most American cities, except on First Nations lands) as well as Asians and other international tourists. I am sure Pavco wants to be able to feature the casino as part of its convention marketing package.

    However, I agree with S Garossino that a convincing, well researched third party study should have been provided along with the application to demonstrate this, if this is the primary rationale for the project.

    My reason for suggesting that conditions be imposed on the completion of the hotels is to demonstrate the attractiveness and viability of the complex as a destination casino, rather than a facility catering predominantly to local residents.

    Two new hotels would be a benefit to the city’s tourism infrastructure, especially since it is difficult to get hotels built in the city (except as a component of a larger condominium development).

    I gained some insights into this during my term as the Provincial Project Manager for the earlier Trade and Convention Centre expansion competition in the mid-90’s when a 1000 room hotel, attached to the Centre was a pre-requisite.

    At the end of the day, a large convention centre hotel did not get built, which in my opinion was most unfortunate. I don’t want to see another tourist oriented facility built without the accompanying hotel rooms.

    If this Casino is allowed to proceed, without any guarantees that the hotels will be built at the same time, then I am inclined to agree with the project opponents that this will not be a good thing for the city.

    I also think that requiring the completion of the hotel rooms as a condition of the occupancy of the casino is another way of testing the financial strength and true intentions of the proponent. After the Olympic Village fiasco, we don’t want another failed project on public land in the city.

    On this point, I recommend Jeff Lee’s front page story in today’s Vcr Sun. In it he notes that David Podmore believes that much of the opposition towards the project is due to the provincial government’s cut-backs to non-profit funding. This may be true for some.

    However, I would add that some of us are concerned about this proposal because we don’t like the role played by a former Chair of the BC Lottery Corp. during the initial negotiations. We also have concerns with the manner in which the Proposal Call was conducted…with 14 companies submitting a Stage 1 Expression of Interest…only 3 being shortlisted… and only two submitting proposals (the other being Concord Pacific who wanted to buy, rather than lease the land.)

    I don’t understand why other major Casino operators with more proven track records of creating international destination complexes didn’t submit proposals. If a casino was seen as an appropriate use for the land, why were they not invited? Or were they? Why was there just one casino application?

    I may be showing my ignorance, but something does not seem quite right about all of this.

    Indeed, I suspect there are people in Vancouver who would be more supportive of this project if it was being proposed by a company like Mirage , who offered us a ‘Destination Casino’ in the 90’s, rather than a proposal from a company that seems to be have undertaken less glorious operations, with questionable ties to the BC Lottery Corp.

    Maybe this is something that needs further airing during the Public Hearing process. It may be there is an appetite for a significant ‘Destination Casino’ project …just not this one.

  • Morven

    According to today’s Vancouver Sun, David Podmore does not believe that opponents have read the proposal otherwise they might approve (or words to that effect).

    An elitist view perhaps.

    Now wait a minute Mr Podmore.

    Most of us poor citizens are not experts in development control or risk assessment and we rely on the assessment of the proposal by independent, trained professional third parties. I think it fair to say that we poor citizens are a tad sceptical of non-independent and possibly self serving studies – after all we have the Olympic Village as an example of the consequences of non-transparent processes.

    Some of us might be tolerant of the casino proposal if there had been an independent assessment, among others, of the crime impact, economic impact, public health impact and community impact. There is, as far as I can tell, none of that.

    None of the information knits together.

    And, for instance, why should the casino regulator be a part of the lobbying process?

    Inappropriate.

    And what are the commitments to accommodate citizen concerns as distinct from just holding meetings.

    So before we poor citizens are castigated by PAVCO for holding dissenting views, look at ways to make the message a bit more credible and transparent.
    -30-

  • Lewis N. Villegas

    Not here. Not now.