Municipal Share Of Ontario Casino Revenue Shows It Could Be A Record Year

Written By Jose Colorado on October 26, 2022
After two off years due to COVID-19 casino closures, Ontario's land-based casinos are projected to hit record revenue of some $163 million.

Ontario casinos are still on pace for a record-setting year.

More than $38 million was shelled out to 28 host communities by the Ontario Lottery and Gaming Corporation (OLG) in the second fiscal quarter (July 1 – Sept. 30). The non-tax gaming-revenue payment comes via the Municipality Contribution Agreement – an arrangement in place to benefit municipalities that host land-based casinos in the province.

While not quite as lucrative as OLG’s first quarter payout ($43,420,036), the $38 million still means Ontario casinos are operating at a record-setting pace.

Consider the payouts for previous fiscal years:

  • 2016-2017: $146.3 million
  • 2017–18 – $160.8 million
  • 2018-19 – $160.8 million
  • 2019-20: $161 million
  • 2020-21: $38 million
  • 2021-22: $82.9 million
  • 2022-23 (projected): $163 million

Ontario casinos contribute more than $81 million this fiscal year

According to the Crown corporation, payments are made via a universal formula applied across all gaming sites in Ontario “using a graduated scale of gaming revenue at the hosted site.”

As of today – and by using this format – OLG has contributed $81,533,793 to these 28 communities during the current fiscal year (April 1, 2022 – March 31, 2023).

Thus, as shown above, if numbers hold, this year should narrowly exceed the highest-grossing period back in 2019 – 2020. That’s the last fiscal year before COVID-19 health restrictions shuttered Ontario casinos for parts of both fiscal 2020-21 and 2021-22. It explains why the total to date in this fiscal year is almost as much as the municipal share for all of the fiscal year 2021-22.

Nonetheless, the uptick in revenue has many in the province optimistic, including OLG Minister of Finance Peter Bethlenfalvy.

“Revenue from OLG’s Municipality Contribution Agreements supports host communities so they can invest in programs and services that benefit everyone, from neighbourhood parks to local festivals,” Bethlenfalvy said in a release.

These payments help to improve the quality of life and make Ontario a vibrant and exciting place to live, work and play.”

Only land-based casinos share revenue with munipalities

As previously reported by PlayCanada’s Dave Briggs, it is important to note revenue-sharing agreements with Ontario municipalities only apply to land-based casinos.

Ontario’s highly coveted iGaming market, including its online casinos and sportsbooks, are in a different boat.

For instance, these businesses are taxed and regulated by the province with revenue going to the government’s general coffers.

Interestingly enough, land-based casinos could be receiving another financial boost in the near future. PlayCanada recently reported on the increased possibility of brick-and-mortar sportsbooks coming to Ontario casinos.

An OLG spokesperson told PlayCanada it is a definite possibility. And given the popularity of online sports betting in the province already, it would be reasonable to expect such an addition could have a significant impact on the overall bottom line of gaming establishments.

City of Niagara receives highest second-quarter payout at $5.2 million

Regardless of whether brick-and-mortar sportsbooks arrive in the near future or not, many cities may simply be rejoicing for the time being.

After all, COVID did a number on the gambling industry and local economies.

Consider the past two fiscal years where OLG’s total payments combined for nearly $121 million. Projections say $122,300,689 will be the payout by the end of the third quarter of this fiscal year alone.

To that end, OLG reports multiple jurisdictions receiving lucrative payouts – in the millions – for the second quarter alone.

Here were a few of the most notable examples in the province of municipal payments in the second quarter alone:

  • City of Niagara Falls (Casino Niagara and Niagara Fallsview Casino Resort): $5,285,233
  • City of Windsor (Caesars Windsor): $2,376,666
  • Town of Innisfil (Gateway Casinos Innisfil): $1,915,252
  • City of Peterborough (Shorelines Casino Peterborough): $791,037
  • City of Sudbury (Gateway Casinos Sudbury): $504,738

Almost $1.9 billion given to host communities since 1994

OLG reports host communities have received almost $1.9 billion in non-tax gaming revenue since 1994.

More recently, service providers have responded. Private sector capital investment has accounted for nearly $1.8 billion over the past seven years in Ontario. Six casinos have opened since 2017 because of these investments. Expansions and enhancements have also occurred as a result.

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Jose Colorado

Jose Colorado is a British Columbia-based writer. He lives in Burnaby and loves sports, anime, writing, business and the occasional walk on the beach.

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