Mr. Mayor, Councillors, Dr. Ballem, City Staff and Concerned Residents of Vancouver:
My name is Sean Bickerton and I’m speaking today as President of Paris Place Strata, as a Director of the False Creek Residents Association and as one of the founding members of the Vancouver Not Vegas! coalition.
I would like to state on behalf of the members of the coalition that we fully respect the workers here tonight, their jobs and the heart-rending stories they have shared with us.
But i’m also wondering, as you must be, how a one-word footnote in an appendix of a 50-page report somehow morphed into the largest casino in Western Canada …
I’m also wondering how, like some creature from the movie Aliens, it managed to glom 0nto BC Place, our family-oriented sports stadium? We’ve recently learned that families and children will be banned from one of the main entrances to BC Place – an entrance paid for by the taxpayers of BC – because that once-public stadium entrance will be taken over by Paragon’s private new megacasino!
Others in our coalition will address the many social issues, related criminality and other community concerns about the massive casino expansion proposed by the applicant, which will triple the size of the existing Edgewater Casino, creating the largest casino in Western Canada, smack in the middle of what will become one of the most densely populated residential neighbourhoods in our most livable Vancouver.
But i will limit my remarks today to the economic arguments that Paragon Gambling Corporation has based their case on, and on the council’s role in determining ‘best use’ for the property at 777 pacific blvd.
Best use is the very underpinning of our city’s zoning and planning processes, and is the underlying basis of the city’s tax revenues. Property owners are taxed based on the best use that can be developed for each property under its current zoning regardless of whether or not that development has taken place.
Taking the concept further, the entire free market our economy rests on is is based on the fundamental concept that capital should be directed to its “best” or “most efficient” use through the competitive marketplace for that capital. The reason the world economy collapsed in the fall of 2008 is because capital was diverted from its best use and instead piled into Ponzi schemes.
Best use, therefore, is not an inconsequential measure by which to examine this proposal.
And just on that fundamental basis, any commercial enterprise designed to funnel money directly into the pockets of government is the worst possible use of capital that can be imagined. Instead of that money turning around in the local community two or three times, generating jobs, investments and taxes earned honestly, the money is instead sucked right out of the economy, creating a net negative effect – acting as a drag on local jobs; on local investment: and over time this kind of negative economic activity will end up reducing, not increasing tax revenues.
Yet they say you should approve this massive expansion is because of all the money the city is going to receive. How much is that exactly?
At the very beginning of this process, Paragon Gambling Co. and PAVCO announced the city would receive an additional $23 million per year! Then they had to correct that number because it included $6 million in taxes that would be paid by any developer of that property, reducing their projection of city revenues to $17 million.
Then, at the very first public hearing for this proposal, that number got smaller when Michael Graydon of BC Lottery Corp. (BCLC) reported that the BCLC didn’t actually have faith in those larger projections and was basing their own economic projections on $11-14 million in annual revenues to the city.
Councillor Louie asked Mr. Graydon that night: “is the methodology BCLC used to reach this estimate the same methodology used for the original Edgewater Casino application?”
“Yes” was BCLC’s answer.
It’s a telling answer because when Edgewater was first approved, the city was promised $12 million annuallly in new revenues. The actual return to the city? It ranged from $3.8 million to $6 million annually, not the $12 million promised.
So we’ve heard these promises before. And if the numbers they are dangling in front of you now are as inflated as their previous projections, you can expect as little as 1/3 of that amount, maybe half in a good year.
What all of these broken promises and shrinking projections make abundantly clear is that the entire project is one big gamble, and my concern is that taxpayers will be left holding the bag.
Approximately half of the casinos in the United States are in bankruptcy or receivership. and according to the Chairman of the Nevada Gambling Control Board, more casinos are soon to follow. He just announced on feb 8 that he expects more casino bankruptcies in the months to come.
Bankruptcies are not uncommon in this industry.
Foxwoods casino, near New York City, went into bankruptcy for $1.6 billion dollars at the end of 2009. And just today the famed Sahara Casino and Hotel in Las Vegas announced they’re going to close up shop this summer.
Why? Due to a lack of business.
And right here in Vancouver, the Edgewater Casino went into bankruptcy in 2006 for $52 million …
Casinos are just not a sustainable business.
Maybe that’s why BCLC has been pouring $40 million a year of taxpayer money into private casino owners in BC. And perhaps that’s why BCLC is now the largest advertiser in the province … and maybe that’s why the financial projections this project is based on seem to keep shifting …
Deloite Touche, the accounting firm hired by the applicant to evaluate their proposal has raised 17 concerns in their report and i’d like to read a few of their cautions, because i think this council needs to be fully apprised of the weak economic underpinnings of this project:
* The projection is based on hypotheses and there is a significant risk that actual results will vary, perhaps materially, from the results projected. No warranty is given as to the accuracy of such information.
* Our report and work product cannot be included, or referred to, in any prospectus, securities and exchange commission filing or other public or investment document.
* A detailed feasibility review / analysis has not been undertaken, nor should one infer that such a study has been undertaken.
* We have not audited or otherwise verified the capital cost estimates associated with this project.”
It’s ironic to the extreme that within living memory of those gathered here today on unceded Coast Salish territory, your predecessors in a city council of an earlier era voted to end all gambling in vancouver. As a result, all of the gambling dens in Chinatown were smashed up and shut down. I’ve heard from people who remember those violent raids as children …
Yet here we are considering allowing an American Corporation to open the largest gambling den west of Ontario just six blocks away! Two football fields full of slot machines!
Only this council is authorized to decide whether or not to approve the gambling licenses for each of the hundreds and hundreds of new slot machines and gambling tables. Only this council can ensure that the property at 777 pacific blvd is dedicated to its best use. And only this council can protect the interests of the residents of this city.
I urge you to consider your legacy and the future you are leaving to the next generation.
Our designation as the most livable city in the world has been hard won by councils of all political stripes that were willing to make hard calls and represent the interests of all those who choose to make their lives in this spectacular place. Please listen to the voices raised against this proposal and vote “No” on expansion.
Thank you for your attention.