Will Brandon, AMC benefit from casino?

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This article was published 24/06/2014 (4336 days ago), so information in it may no longer be current.

“Brandon will be a big beneficiary of the impact.”

— Sand Hills Casino spokesperson Barbara Czech

The opening of the Sand Hills Casino, Manitoba’s third aboriginal-run casino, is a watershed moment for the Assembly of Manitoba Chiefs and the province of Manitoba.

After several years of false starts — including two failed referenda in Brandon — financing problems and location and name changes, the $25-million casino finally opened its doors to the public in grand fashion yesterday. The 31,000-square-foot facility features 350 slot machines, table games, a restaurant, lounge and live entertainment.

But for all its amenities, we remain unconvinced that Brandon or the 63 AMC member First Nations will greatly benefit from its operations. Certainly not as much as they could have, given the location.

The AMC has worked very hard to see this day come, and we have no doubt that Swan Lake First Nation, which hosts the casino, and a few surrounding communities including Carberry and perhaps Glenboro, will stand to benefit from having the business along Highway 5. This is certainly a strong economic decision for these communities and good on them for rushing in where Brandon feared to tread.

Nevertheless, the casino administration continues to promote itself to the region, for obvious entertainment and economic reasons. The AMC, together with managing company Hemisphere Gaming, are touting the casino’s benefits to the region, suggesting that it will have a cumulative economic impact of “at least” $150 million to Westman. The casino’s press release yesterday also touted the facility as western Manitoba’s next “premier entertainment destination.”

And in her recents comments to the Sun, Barbara Czech said that Sand Hills will need to source out an estimated $3 million of goods and services annually, with further hopes of drawing customers from the city. Also, the casino currently employs 160 full-time employees, with approximately 80 from Brandon — the majority of whom are of aboriginal descent.

Considering the long and winding road that Manitoba’s third native-run casino has taken over the last decade to come to fruition, the last thing that the Assembly of Manitoba Chiefs needs is to see this enterprise fail. Yet to our minds there remain nagging issues that have not been addressed by the provincial government or the AMC.

Hemisphere Gaming, the same company that financed and operates the South Beach Casino, which opened in 2005, will manage the Sand Hills Casino for the next 10 years.

In November 2012, the Brandon Sun obtained a copy of the deal signed between the AMC and the Minnesota-based gaming company, an agreement that exacted hefty management fees, significant revenue shares and a financing incentive fee if Hemisphere is able to negotiate a better financing interest rate with a bank, than the stated project rate of 13.5 per cent.

While Czech has previously cautioned the Sun that this may not have been the final version of the agreement, our story on the agreement was never challenged. As a CBC report a few years ago showed, Hemisphere had already been exacting heavy fees from the South Beach Casino. And in its desperation to get the Sand Hills Casino up and running, the AMC was apparently left with little choice but to turn to Hemisphere Gaming once more.

Because of this, we rather doubt AMC members will see much dividends from Sand Hills for the foreseeable future.

Czech also said Sand Hills was attempting to work with “several representatives from the City of Brandon” to see how the city could use the facility in the future.

We again note — with regret — that Brandon will have none of the greater benefits it might have enjoyed had the casino been built within the city. Downtown redevelopment remains stymied because we have no anchor tenant — the casino would have been a competitive option. As a result, the city has also missed out on any taxes it might have exacted from the multimillion-dollar facility.

And all the city can do now is place a bet with a weak hand.