Toronto Mayor Rob Ford and city manager are close on downtown casino development

The possibility of a downtown Toronto casino took a more concrete form on Monday when the city’s manager released a report recommending a size limit and profit expectations for the controversial project.

And while Joe Pennachetti’s report wasn’t exactly a rallying call to support a casino, championed by Mayor Rob Ford, his recommendations in many ways echoed a public letter released by the mayor earlier in the day.

"This is a golden opportunity for Toronto and one we probably won’t see again for a generation," Ford wrote about the proposal for a downtown casino, according to the Toronto Star.

The letter in support of the project came just hours before Pennachetti made public his highly-anticipated report. The report did not outright recommend that city council approve the construction of a downtown casino, but it did suggest an outline should city council decide to move forward with the project.

Among other recommendations, the report said the city should receive an annual hosting fee of no less than $100 million, that the gambling floor should be no larger than 135,000 (less than the minimum of 175,000 square feet sought by the Ontario Lottery and Gaming Corp.) and that whoever runs the casino should implement a “social contract” to address the adverse effects of the gambling house.

The reports did recommend expanding the gaming operation at Woodbine Race Track, near the city’s border, adding that the separate project should not affect the discussion on a downtown casino.

[ Related: Ford officially backs casino as city report released ]

Here is the full report, which will be presented to the mayor’s executive council at its meeting on April 15 and 16.

While Pennachetti’s report and Ford’s letter of support were very different, one thing that stood out were the similarities on a number of issues. Let’s take a look.

On the issue of crime

Ford said: Gambling is not new in Toronto. Woodbine Race Track had been standing for years, without police reporting an increase in crime. He referred to opposition against the casino, much based on its social impact, as “emotional or partisan rhetoric.”

Pennachetti said: Wherever the casino is placed, there is a chance of negative social impact. But those effects can be mitigated by an appropriate "social contract," which should be required from the casino operator.

"Findings indicate there is inconclusive evidence of a relationship between increased access to gambling and crime rates. Studies that found an increase in reported crime following the introduction of a casino into a community indicate increases tend to be small in magnitude and short-term in nature."

A casino would lead to jobs

Ford said: Many Toronto residents are unemployed, and a casino would create 10,000 new permanent jobs with an average salary of $55,000. On top of that, the casino/convention centre development would help lure tourists and investors.

"Last year, City Council adopted a new Economic Growth Strategy designed to stimulate job creation. Part of our plan to attract new employers to Toronto is to get more investors to visit our city."

Pennachetti said: The report indicated that a downtown casino could create 10,200 jobs, with an average salary of $45,000. It added that convention centre space is a requirement for a downtown casino project.

"Expanding convention space to bring Toronto into the top ten for convention space in North America has the potential to attract more tourists and would be a key economic driver for the City."

A casino would bring a financial windfall

Ford said: There are private companies out there ready to spend as much as $3 billion on a downtown casino project. That project would be worth as much as $150 million for city coffers every year, if the profits are split equally between the city and province. (This is not guaranteed, considering other regions bristled at the idea of Toronto getting a sweeter deal from OLG.)

Pennachetti said: The downtown casino could provide the city with an annual financial benefit of $111 million to $148 million. The city should move ahead with a downtown casino only if it is guaranteed a hosting fee that is equivalent to what the province receives and is a minimum of $100 million per year.

“Direct financial benefits to the City include hosting fees, property taxes and potential revenue from the sale or lease of City owned land if the City becomes involved in a casino development.”

The numbers differ at some key points, the focus varies by topic and the decision is less cut-and-dry in the city report, but there are definite similarities between Ford’s letter and Pennachetti’s report.

They may not be on the same page, but it seems the mayor and the city manager are at least speaking the same language.