03/13/2012 06:18 EDT | Updated 05/13/2012 05:12 EDT

Toronto-area casino could crush other venues

The Ontario Lottery and Gaming Corporation’s grand expansion scheme to pump a billion dollars into provincial coffers by building a new casino in the Greater Toronto Area is being touted as a winning economic benefit to the area, but existing gaming facilities may end up as the losers, observers say.

The Georgian Downs Racetrack (formerly Barrie Racetrack) in Innisfil, Ont., which has 1,000 OLG slot machines and recently celebrated its 10th anniversary, is a popular weekend tourist destination for Toronto residents, said Mayor Barbara Baguley.

But that could all change with a competing casino in the Greater Toronto Area.

“The reality is rural Ontario doesn’t have the economic engine that the GTA has,” she said. “We’re 45 minutes to an hour from downtown Toronto. If people can stay home and have the same [gambling] experience, it can have a ripple effect out in our community in terms of siphoning off jobs and spending.”

The slot machines provide about $4 million a year to Innisfil’s capital budget, money that has helped to build a new recreation complex, fire hall and library for the community of 35,000, Baguley said.

The racetrack employs more than 100 people, she added. “Losing 100 jobs in the GTA does not have the same effect as losing 100 jobs in Simcoe County.”

On Monday, the OLG announced a massive “programming expansion,” which would add $1.3 billion annually to provincial coffers by 2017, with the new casino accounting for about 40 per cent of that amount.

The plan also includes expanding the sale of lottery tickets, moving gambling online and consolidating or closing gaming facilities that are "underperforming," in border cities like Windsor and Niagara Falls.

OLG chairman Paul Godfrey did not provide specifics on a new casino, but said OLG would not make a move to build a casino in Toronto or anywhere else in Ontario until it knew the stance of the local government.

"We are looking across all Ontario," he told a news conference Monday. "And there'll be gaming zones developments where these kind of facilities will be looked at, but always in consultation with the municipal council. If a municipal council says to us they don't want it, they won't get it."

Officials in Windsor and Niagara Falls have not yet been told of the fate of their casinos, and Godfrey said that out of respect for employees any potential closures would not be discussed at the press conference on Monday.

Border casinos already in decline

Establishing new gambling locations while shutting down others is necessary, because border casinos are struggling to attract U.S. crowds said Godfrey, pointing out that profit from border gaming sites has plummeted from $800 million in 2001 to $100 million in 2011.

The Windsor casino provides the city with $7 million a year in property tax, a $3 million casino hosting fee that pays for 25 police officers, as well as $1.5 million in revenue from slot machines, said Onorio Colucci, the city's chief financial officer and treasurer.

“It’s one of the city’s biggest employers, it’s helped diversify our economy and it’s provided significant revenue.”

The money is used for capital projects as well as to help fund projects for underprivileged children, Colucci said.

About 80 per cent of casino patrons used to come across the border from Detroit, but that number has dwindled since the U.S. city opened three new casinos of its own a few years ago, he said.

However, shutting down Windsor’s casino “would exacerbate the unemployment situation,” which is already under pressure, he added.

Innisfil town officials are to meet with the OLG in early April to discuss the fate of its gaming facility, Baguley said.

Colucci was not aware of a scheduled meeting between the OLG and Windsor officials.

Officials in Niagara Falls and Orillia, which both have casinos, did not respond to a CBC News request for an interview

Gambling's social risks

A new casino in the Greater Toronto Area would create a magnet for people with gambling problems, so it’s important to build in prevention programs from the start, experts say.

“With the expansion of gambling opportunities, there’s always risks, so it’s important that stringent player safeguards are built in right from the start,” said Jamie Wiebe of the Responsible Gambling Council.

“The message has to be to embedded into contracts and operating agreements” with the private company that will run the casino, she said.

Risks exist for people who continue to gamble despite harm to their family, work and finances, as well as their health.

Player safeguards include self-exclusion programs and accreditation standards for gambling venues.

Residents of both Innisfil and Windsor initially had concerns about casinos bringing problem gambling and a related rise in crime to their communities, but that has largely dissipated and been offset by the overwhelming benefit of having casino revenue flowing to their municipal budgets each year, say their city officials.

“It has led to some traffic issues and some problem gambling, but in this day and age people are just as likely to be gambling on the computer in their living room,” said Colucci.

Adds the Innisfil mayor, “The reality is we have not experienced problems associated with gambling like prostitution or people losing their homes. There are a few more calls to paramedics because the target [gambling] audience tends to be retired people.”

Ontario spends $50 million annually on problem gambling and the OLG plans to expand its support, including using facial recognition technology on all gambling sites to monitor people who have asked to be excluded.