The Ontario Lottery and Gaming Corp. has proposed a new funding model for the Ontario racing industry worth $1.5 billion over 17 years. The concept is to be discussed with the industry who will be asked for their input at a series of public consultation sessions hosted by Ontario Racing (OR) throughout the month of November (see dates below).
The new funding would provide $93.4 million annually for an initial term of seven years starting in 2021 with two additional five-year extensions available, based on performance measures and contract compliance. The province is currently providing $100 million annually to the industry via the Horse Racing Partnership Funding Program which ends April 2019, it is expected that the OLG would seek a two year extension to bridge the gap.
The key feature of the proposed framework is the creation of a new Racetrack Alliance which would set all race dates and purses. All Ontario racetracks that conduct live racing would be invited to be part of the new alliance which would be governed by a not-for-profit corporation in conjunction with the Woodbine Entertainment Group (WEG). All tracks who want to receive subsidies must join the alliance.
The board of the Racetrack Alliance would be comprised of representatives from all levels and disciplines of racing, and would be formed with the support of OR. While it would be stipulated that WEG would not have a majority of the directors, certain material decisions would require approval of WEG nominees. The full definition of what the material decisions might be are not yet available, but would include provisions so that WEG could not be removed from the board, for example.
To receive funding, the Racetrack Alliance would enter into an agreement with OLG who would release the funds to WEG which would be responsible for all management of administration. WEG would also be provided $2 million from the fund to cover administration fees including race office staff, purse management, tote operations, and settlements.
To qualify for continued funding and to ensure accountability, the Racing Alliance would be responsible for meeting performance measures including:
– Wagering targets
– Cost allocation agreements to ensure shared administrative efficiencies for racetracks
– Annual Business Plans from all tracks
– Pari-Mutuel wagering revenue sharing agreement
– Reporting requirements to OLG, including 5-year strategic plans.
Based on the feedback provided at the industry consultations, OR will assemble a report on behalf of the industry that will be made public and will be submitted to the OLG.
Should the industry accept the proposal, it is anticipated that the OLG would submit the commercial agreement to the Minister of Finance who would then seek funding approval from the Ontario government. If the concept is rejected, the newly elected board of OR will be required to develop a new proposal to the industry’s consideration.
Industry Long Term Funding Outreach Plan – 2016 – SUBJECT TO CHANGE
Wednesday, October 19 – Long Term Funding Webcast (available online) – 1pm-2pm
Monday, October 31 – Toronto (Woodbine Racetrack) – 2pm-4pm
Tuesday, November 1 – Hamilton (Flamboro Downs) – 2pm-4pm
Wednesday, November 9 – Sarnia (Hiawatha Raceway) – 5pm-7pm
Sunday, November 13 – London (Western Fair Raceway) – 2pm-4pm
Sunday, November 16 – Ottawa (Rideau Carleton Raceway) – 5pm-7pm
Saturday, November 19 – Port Perry (Location to be confirmed) – 1pm-3pm
Tuesday, November 22 – Milton (Mohawk Raceway) – 2pm-4pm
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