A tentative deal has been worked out between Grand River Raceway and the Ontario Lottery and Gaming Corporation (OLG).
The agreement was announced on Feb. 5 in a News release that stated, “[The OLG] is pleased to announce that it has reached a lease agreement in principle with Grand River Agricultural Society for OLG’s slots operations at Grand River Raceway.”
Raceway general manager Dr. Ted Clarke added in the release, “This is the required first step to continuing the quest to offer horse racing at Grand River Raceway this year.
“Unlike last month’s Woodbine announcement, there is still much to be done. Those meetings begin today.”
OLG has provided a letter of intent which sets out the general intentions and business arrangements subject to approval between OLG and the track. That approval is expected by Feb. 28.
“We are pleased to announce that we have reached a lease agreement in principle for our slots at Grand River Raceway,” OLG president and CEO Rod Phillips said of the deal which includes the 240 slot machines at the track.
Clarke would not comment on particulars of the tentative deal, which requires approval from the agricultural society’s board of directors and its members. The society’s annual meeting is Feb. 28.
The general manager acknowledged the track will lose $4 million, as will the horse racing industry at Grand River with the end to the Slots to Racetrack program on March 31. The program provided tracks with 10% of slot revenues with an equal amount to the horse racing group associated with the track.
The Liberal government announced late last year it was ending the program that generated about $9 billion for the industry.
“The horse racing industry has faced an enormous setback with changes in the revenue flow,” Clarke told the Advertiser on Tuesday.
He declined to comment directly on whether money raised from the lease agreement will offset the $4 million loss.
The Ontario Racing Commission has approved 65 race days at Grand River Raceway this year, but Clarke said changes to the schedule can be made depending on the final agreement with OLG.
Late last year the government appointed a transition task force to look at ways to assist the industry. The task force recommended transition funding of up to $50 million to assist the industry once the program was halted. In its final report the task force indicated more money would be needed to help the industry adjust to the new market conditions.
However, the amount of transition funding the task force is recommending has not been made public.
Clarke said he will be meeting with the task force along with other race track representatives to work out details of potential transition funding.
“We’re certainly going to be in discussions,” he said.
The OLG is looking for private sector partners to operate casino facilities in its newly-created gaming zones. Private operators, when chosen by the end of this year, will decide whether they will continue operating out of current facilities or relocate within the zone.
Elora is part of Southwestern Ontario Zone 1, which includes Kitchener, Waterloo, Wilmot Township and parts of Cambridge.
OLG has had talks with potential host communities including Centre Wellington, Wilmot, Woolwich and Kitchener. Cambridge has indicated it is not interested in hosting a casino.
The new lease arrangement is expected to draw on a fee for the racetrack. The leases would run until a new operator is chosen and then be transferred to the new operator.
