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Two per cent of all gross betting revenue through licenced online platforms will be earmarked for Indigenous communities when the regulated Alberta iGaming market opens in July.
But the distribution process remains unclear. How will this money move from the provincial coffers to the 46 First Nations in the province?
Millions Promised, No Plan Yet
Dale Nally, Alberta’s Minister of Service Alberta and Red Tape Reduction, said that the two per cent share will be sent to the provincial government’s Indigenous Relations department. The department is “currently working on a program” on how those funds will be distributed.
Nally said that a United Conservative Party announcement on the breakdown is coming shortly.
“It is going to be multiple millions every year, because we’re talking gross gaming revenue.”
Nally also added,
“So it is a very substantial amount. And that piece is going to be managed by Indigenous Relations; they’re the closest to that file, and it’s important that they do that work. They’re doing it right now.”
A History of Mistrust
The provincial government promises the funding framework for Indigenous nations will soon be made public. Yet, there are longstanding trust issues at play.
Trevor Mercredi, the grand chief of the Treaty 8 First Nations, was quoted by CBC earlier this week. He said he’s not sure that the iGaming revenue share will offset what Indigenous bands stand to lose from physical casinos. He also asked for more consultation with Nally’s ministry.
“To say that this is being looked at is something positive, it’s hard for us to see the positive in this right now,” Mercredi said.
There are currently six First Nations-hosted casinos operating in Alberta.
In 2021, the Tsuut’ina and Stoney Nakoda First Nations went to court seeking to shut down the government-run PlayAlberta app. It’s the only regulated gambling site in the province. They claimed the government had no legal right to run a gambling site.
That suit was dismissed in 2023. However, it’s a sign of the existing schism between the government and Indigenous groups, especially over gaming revenue and who controls it.
Consultations Held
Nally said the government’s dialogue with Indigenous groups had been positive before the regulated iGaming market launch.
“We invited all 46 First Nations to participate in the consultation. Many of them did, and we ended up building benefits right into the regulations.”
That two per cent is estimated to amount to about $12 million in year one, then to nearly $17 million a year by the close of the decade. These are estimates, of course. Final totals will depend on how much revenue gaming operators generate.
So far, Alberta’s Gaming, Liquor and Cannabis (AGLC) has received 32 expressions of interest.
Nally doesn’t believe that brick-and-mortar casinos will lose out. He doesn’t see the July 13 opening as some sort of floodgate for gambling. Instead, he views it as the government trying to regulate and tax an already existing market.
By provincial estimates, PlayAlberta accounts for only about a third of the iGaming money Albertans spend. The rest flows out of the province through unregulated sites and apps.
“There is a significant illicit market, it is absolutely substantial,” said Nally. “I have asked many people if they make sports bets online. Quite often, the answer is yes, and they’re using a plethora of different platforms to make those bets.”
He further added,
“The reality is that the money has already started to move. If online gambling is going to cannibalize land-based casinos, that won’t begin on July 13. It would have already started because online gambling is alive and well in this province.”
So, the July 13 launch is simply a reorganization of an existing market. With that in mind, it’s worth looking at casino growth over the past few years.
Land Casinos Still Holding Strong
In its most recent annual report, AGLC reported gambling revenues of more than $1.5 billion, the highest level since COVID lockdowns. Physical casino slot machines earned $835 million, with another $512 million raked in by VLTs. These numbers show a casino business that’s doing well.
Nally said he sees land-based Alberta casinos and iGaming working in concert. Mobile Alberta sportsbooks offer convenience and immediacy, but as Nally put it, “land-based offers something you can’t get online, and that’s the experience.”
At a casino, a player can see a show, have a cocktail, and order up a steak. There’s always going to be a market for that experience.
