Toronto casino-hosting fee windfall has other cities asking for their piece of the pie

If you doubt Ontario politicians are addicted to gambling, just look at the scramble over anticipated fees for a Toronto casino project that is years away from opening.

The Big Smoke is entertaining proposals from international casino operators for a massive downtown complex that's touted as a major job creator and revenue generator for the city.

So important is this project that the Ontario Lottery and Gaming Corp. (OLG), which governs all legal gambling in the province, is promising Toronto would receive much higher fees to host the casino than other cities get, The Globe and Mail reported this week.

Toronto could receive between $50 million and $100 million in annual hosting fees. That's more than double what it would be eligible for under the existing formula now applied to other cities, an industry expert told the Globe.

Experts said Toronto is a special case because of the scale of the billion-dollar project, its revenue potential and its location in the heart of Canada's largest city, the Globe said.

[ Related: Toronto councillors prepare as casino debate nears end ]

But it didn't take long for civic leaders in other Ontario cities to weigh in with views that boiled down to "where's my slice?"

Niagara Falls Mayor Jim Diodati, whose city gets $3 million a year in hosting fees for its two casinos that caters to the tourist city's visitors, said he wants the same deal.

"We don't think anyone should receive preferential treatment," Diodati told the Globe on Thursday.

And Windsor Mayor Eddie Francis told the Windsor Star on Friday that he expects his city to be able to cash in on the Toronto deal thanks to a so-called "favoured-nations" clause in its deal with OLG.

The clause in the legal agreement apparently protects Windsor if another Ontario city gets a better deal.

“I’m glad that Toronto will get millions of dollars," Francis said. "That means the city benefits as well. We’ll hold the OLG to the legal and community commitments it made.”

[ Related: MGM unveils massive Toronto casino complex plan ]

Windsor gets $3 million in hosting fees, plus funding for 20 police officers worth a reported $2 million a year, the Star reported. It's not clear how much more money Windsor could expect to receive. City treasurer Onorio Colucci said he has read the clause in the OLG contract several times and it does not give specific numbers or percentages.

The Toronto deal has Ottawa Mayor Jim Watson steamed. In a letter to OLG chairman Paul Godfrey, Watson essentially threatened to cancel plans for a casino in the nation's capital unless Ottawa gets fees based on the same formula being used for Toronto.

“Unless the City of Ottawa receives the same revenue sharing formula as that being made available to the City of Toronto I will, in the coming months, bring forward a motion to City Council recommending that the City of Ottawa withdraw from the OLG’s [request for proposals] process,” Watson wrote.

The Toronto casino is part of the OLG's proposal to open five new casinos in the province. The Star noted the Crown gaming monopoly generates $2 billion for the provincial treasury and its planned expansion is expected to add another $1.3 billion in cash flowing to the cash-strapped government.

OLG has a half-dozen casinos and locations for slot machines in a number of racetrack locations.