BC Ferries wants bigger gambling cut Corporation not ready to commit to slot machines on vessels, but ‘ it’s not dead’
VICTORIA — BC Ferries says it needs a bigger share of gambling revenue from the province before it makes financial sense to put slot machines on its ships.
Ferries CEO Mike Corrigan said he’s investigated the B. C. government’s idea to allow gambling on board the ferries that travel the major routes between Victoria and Metro Vancouver, and the numbers don’t work unless BC Ferries gets a larger share of the profits.
“We’re still looking at it,” Corrigan said Thursday of the idea. “It’s not dead.
“We’ve done a full analysis to BC Ferries in terms of the cost to do gambling on the ships and it’s not going to be insignificant.
“Based on the current ( BC Lottery Corporation) revenue sharing model, we can’t find a business case to make it work. We’ve given it back to government to see how they’d like to proceed because they have the opportunity to maybe look at the revenue funding model and alter it a bit.”
Corrigan said he’s unable to share his specific calculations publicly.
The ferry corporation would typically get only 25 per cent of the slot machine revenue, after prizes are paid out, with the government’s lottery corporation taking the rest.
The idea of slot machines on ferries was first floated by Transportation Minister Todd Stone in 2013 as way to generate revenue to offset fare hikes. Stone said Thursday he’s waiting for a detailed analysis of the costs and revenues the slot machines would generate before making a decision.
“If the analysis makes it abundantly clear that this is not a viable strategy, then we’ll move forward and drop this idea,” he said. “But we’re not there yet.”
Stone said he hopes to make a decision before Christmas. “At this point we haven’t ruled out ( gambling),” he said.
There are also regulatory and legal issues that need to be considered, said Stone.
In addition to getting only part of the gambling revenue, BC Ferries would also need to spend significant money to improve security to allow for slot machines, Corrigan said.
“We’d have to have secure areas, we’d have to have additional staff maintaining those areas, we’d have to upgrade our IT systems, we’d have to have more CCTV cameras, and these are all significant costs to BC Ferries,” said Corrigan.
If the province wants to make the idea work it will have to look at ferries as different from existing casinos and other dedicated gambling facilities and provide a better deal on revenue, Corrigan said.
Those casinos and hotels can entice people with gambling, but they also make money on hotels, drinks and meals that allow them to take a lesser share of the gambling revenue, he said.
“We have a very defined footprint on our vessels, there’s only so much space there and right now we’re making a lot of money, in year- to- year gains especially, on our retail business,” Corrigan said.
“So from our standpoint we see that retail business as a place where we want to continue to expand on our ships. We have to do a trade- off study of that versus gambling and see if it would make sense.”
The Finance Ministry, which oversees gambling regulations, said in a statement Thursday that government’s willingness to change the revenue- sharing model for BC Ferries would depend on the viability of the overall business case.
Ultimately, it’s the BC Ferries board that makes the final decision on whether there’s a business case for slot machines and not the B. C. government, said Corrigan.
“Government can certainly suggest that we put gambling on BC Ferries and we’ll certainly look at it if it makes sense in terms of keeping fares down,” he said. “But at the end of the day, the decision lies with BC Ferries board.”