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Letter: COVID-19 changes everything when it comes to the KED

The man behind Casino-Free Sudbury, Tom Fortin, says the pandemic and its impact on gambling operations provide an opportunity to rethink the Kingsway Entertainment District 
Artists representation of Kingsway Entertainment District. (File)

The normalcy of our lives only a year ago seems like a distant memory compared with what we are all dealing with today. COVID has forced upon us a new way of living, with economic strains

disproportionately carried by certain sectors of our economy.

In Sudbury, the strain is evident on school boards, the YMCA, arts, cultural and social support

organizations, restaurants, and retail businesses with the exception of big box stores.

The level of debt taken on by both federal and provincial governments to deal with the crisis via financial support programs is unprecedented. The federal deficit is estimated to be over ten times 2019 levels at $343 billion, raising the federal debt to over $1.1 trillion dollars. 

Similarly, the provincial deficit is estimated to be over $38 billion.

This astounding level of debt increase not seen since the Second World War will ultimately result in austerity when the financial hangover ensues.

In the years to come, the city will receive less money from higher levels of government through transfer payments and support programs. This at a time of a higher demand from the various impaired entities in Sudbury.

Financially, things are going to get tougher in the post-COVID world for municipalities and taxpayers.

The rise of on-line shopping (and gambling), work-at-home programs and the fear of social gatherings are behaviours that will, to some extent, remain intact in our post-COVID world.

The pandemic has heavily impacted casinos in Ontario. On Sept. 30, Rob Mitchell of Gateway Casinos made the following statement when asked why construction on the Wonderland Road Casino Development in London has stopped.

“At this time, all our resources are focused on reopening our existing casinos and adjusting to the challenges of the ‘new normal’ that COVID-19 has brought to the gaming industry. Under present circumstances, it is difficult to forecast when development projects can resume until we better understand the impact of COVID-19 on our existing operations. All of these concerns impact the planning, timing, and design of projects.”

Key takeaways from this statement are that COVID has made the future of casinos uncertain and Gateway is wisely suspending all projects until they can understand the impact of COVID on existing operations. Gateway concedes the impact of COVID may change “planning, timing and design of projects.”

This leaves many questions to be answered.

Will the predominantly seniors-based patrons return to casinos at their pre-COVID levels in the post-COVID world?

Will the decline in casino revenues continue, and accelerate post-COVID? Gambling revenue at the Slots in Chelmsford in 2012 was $50.2 million, and by 2019 it had eroded to $39.6 million, based on payments made to the city.

Is a $60 million casino development still viable in Sudbury post-COVID?

The bottom line is that Gateway will reconsider their options when the COVID crisis is over. This may be years from now. We should expect that projects will be smaller, more automated (less employees), and less profitable than anticipated pre-COVID.

Regardless of the decision of LPAT, should the city pause the KED until there is certainty in the future viability of both, the project, and the level of contribution of the partners? Given the radical changes COVID has forced upon consumer behaviour, and the impending impairment of municipal finances, should other options be considered?

I think so, because COVID changes everything.

Tom Fortin
Director of