Ontario’s Finance Minister Charles Sousa recently announced the province will not delay the process of choosing the next operator for of Niagara Falls’ two casinos, Casino Niagara and Niagara Fallsview Casino Resort, despite resolutions unanimously passed by St. Catharines and Niagara Falls councillors.
Both casinos are owned by the Ontario Lottery and Gaming Corporation but managed by Toronto-based Falls Management Group. The current arrangement will expire in June 2019. In October, the OLG issued a request for pre-qualification for potential candidates to run the casinos, a step in the process before RFPs are issued. But Niagara Falls officials asked the province in October and November to postpone the RFPQ to focus more on job creation and retention.
Councillors, local politicians, chambers of commerce and unions in St. Catharines and Niagara Falls contend the current bidding plan could jeopardize up to 1,400 jobs at the two casinos, which employ more than 4,000 people. The plan also would result in losses of tens of millions of dollars to the Niagara economy, according to a study by third-party HLT Advisory.
In response to a letter from Niagara Falls Mayor Jim Diodati and Niagara Region Chair Alan Caslin, Sousa wrote, “OLG will continue to proceed with the release of the RFP for the Niagara Gaming Bundle. Any change in direction at this late stage would have an adverse impact on the future value to Niagara and the province, particularly given that the existing operating agreement with our Fallsview provider was terminated; a decision endorsed by the City of Niagara Falls.”
The OLG issued the RFPQ last October and the deadline for groups to submit a bid closed December 15.
Diodati commented, “This does not address the most important issue — the 1,400 jobs at Fallsview Casino Resort and Casino Niagara. This model is flawed. It’s dangerous. It leaves too many jobs at risk. It’s a concern for everybody.” Caslin called Sousa’s letter “a red herring” that doesn’t address the jobs issue. He added, “Consultations have not taken place. It’s disappointing.”
Diodati and Caslin had asked the OLG to end the current RFPQ and RFP process and to reissue the RFPQ to include the original four objectives for the Niagara Falls casino as outlined in 1996. These include: job creation, economic development, lasting economic benefit and maximizing provincial revenue.
Councillor Mike Britton, author of the St. Catharines resolution, said the OLG’s plan only promotes the objective of providing revenue for the province. “I don’t believe that’s right, that the only goal for this new modernization is to get revenues to the province. Frankly, they should be worried about job creation in Niagara as we all are. It’s unfortunate the local stakeholders weren’t consulted, but that probably would have slid if the plan turned out to be good. The problem was, it was not.”
In his letter, Sousa said modernizing the Niagara casinos actually is occurring because the city requested it. “In fact, OLG included the Niagara casinos in its modernization procurement process in response to the two City of Niagara Falls Council resolutions from February 2014 and May 2015.” In addition, Sousa wrote the city “is the only host community to also benefit from a guaranteed nongaming infrastructure project”–a 5,000-7,000 seat entertainment center. And, he added, “In 2015-16, the payment to the city was nearly $24 million, which was up from $7.3 million in 2012-13. This money can be used to invest in local programs and infrastructure projects to help foster economic development and opportunity. Under modernization, host payments will continue through the Municipal Contribution Agreement according to the same formula currently applied.”
But those are not the issues, Diodati stated. “It’s 1,400 jobs and 1,400 families,” he said.
