Zoe Sharp
On Wednesday, the Ontario Lottery and Gaming Corp. (OLG) announced that it paid the City of Niagara Falls the staggering amount of $3.93 million for the three-month period, starting from January 1, for hosting Casino Niagara and the Fallsview Casino Resort. However, the total is down compared to the payment of $4.4 million, which the city received in January last year.
OLG Has Handed Over $194 Million to the City of Niagara Falls Since 1996
In the last fiscal year, which ended on March 31, the City of Niagara Falls received $19.9 million from the OLG for hosting the two casinos, namely Casino Niagara and the Fallsview Casino Resort. OLG said the city received $194.9 million in payments since 1996 when Casino Niagara opened its doors. OLG reported that it paid nearly $2 billion in non-tax gaming revenue to host municipalities since 1994.
The payments OLG makes to communities that host gambling establishments are based on a formula that takes into account the gaming revenue generated by the hosted casino. The higher the casino revenue is, the higher the payment to the host municipality is. The City of Niagara Falls receives its casino-hosting payment on a quarterly basis.
In a news release, Ontario Finance Minister Peter Bethlenfalvy said that the Municipality Contribution Agreements are an important source of funds for the municipalities. He explained that gaming host municipalities use the money to fund local programs and infrastructure. Mr. Bethlenfalvy added that the revenues help gaming host municipalities to create better job opportunities and a higher standard of living.
OLG announced that it is proud of being able to share proceeds with communities that host gambling establishments and boost their economies.
The City of Niagara Falls Renegotiated Its Casino-Hosting Revenue Agreement in 2013
Before signing a new agreement with the OLG in 2013, the City of Niagara Falls received a fixed annual rate of $3 million for hosting the two gambling establishments. Between 2014 and 2019, the City of Niagara Falls raked in over $20 million a year (or $5 to $7 million every three months).
In 2017, the OLG paid the City of Niagara Falls over $26 million. But the city’s hosting fees significantly declined due to the Covid-19 pandemic and the lockdown measures, which forced most gambling establishments to cease operations temporarily.
But what bothers city officials now is the $1-billion Vegas-style resort and casino expected to open this summer in Toronto. According to experts, it will hit the revenue of the two casinos in Niagara Falls as well as the payment that the municipality receives from the OLG. Niagara Falls Mayor Jim Diodati explained that the new casino in Toronto will cost his city $4 to $5 million a year.