THE ROLE OF LOCAL GOVERNMENT IN GAMBLING EXPANSION IN BRITISH COLUMBIA Mario Lee Graduate Diploma in Urban Studies, Simon Fraser University, 2003 THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS In the Department of Political Science O Mario Lee 2005 SIMON FRASER UNIVERSITY Spring 2005 All rights reserved. This work may not be reproduced in whole or in part, by photocopy or other means, without permission of the author. APPROVAL Name: Mario Lee Degree: Master of Arts Title of Thesis: The Role of Local Government in Gambling Expansion in British Columbia Examining Committee: Chair: Tsuyoshi Kawasaki, Ph.D. Associate Professor, Department of Political Science Patrick J. Smith, Ph.D. Senior Supervisor Professor, Department of Political Science Peter Oberlander, Ph.D. Supervisor Adjunct Professor, Department of Political Science Thomas Hutton, D.Phil. External Examiner Associate Professor, School of Community and Regional Planning University of British Columbia Date DefendedIApproved: h wr 1 0 .& SIMON FRASER UNIVERSITY PARTIAL COPYRIGHT LICENCE The author, whose copyright is declared on the title page of this work, has granted to Simon Fraser University the right to lend this thesis, project or extended essay to users of the Simon Fraser University Library, and to make partial or single copies only for such users or in response to a request from the library of any other university, or other educational institution, on its own behalf or for one of its users. The author has further granted permission to Simon Fraser University to keep or make a digital copy for use in its circulating collection. The author has further agreed that permission for multiple copying of this work for scholarly purposes may be granted by either the author or the Dean of Graduate Studies. It is understood that copying or publication of this work for financial gain shall not be allowed without the author's written permission.\ Permission for public performance, or limited permission for private scholarly use, of any multimedia materials forming part of this work, may have been granted by the author. This information may be found on the separately catalogued multimedia material and in the signed Partial Copyright Licence. The original Partial Copyright Licence attesting to these terms, and signed by this author, may be found in the original bound copy of this work, retained in the Simon Fraser University Archive. W. A. C. Bennett Library Simon Frascr University Burnaby, BC, Canada SIMON FRASER UNIVERSITY Ethics Approval The author, whose name appears on the title page of this work, has obtained human research ethics approval from the Simon Fraser University Office of Research Ethics for the research described in this work, or has conducted the research as a co-investigator of a project, or member of a course, approved by the Ethics Office. A copy of the human research ethics approval letter has been filed at the Theses Office of the University Library at the time of submission of this thesis or project. The original application for ethics approval and letter of approval is filed with the Office of Research Ethics. Inquiries may be directed to that Office. W. A. C. Bennett Library Simon Fraser University Burnaby, BC, Canada ABSTRACT This thesis examines the role of local governments in British Columbia in gambling expansion, during the period 1994 to 2004. In particular, it tries to explain why municipalities in BC are able to define gaming policy to an extent unparalleled in Canada and posits three reasons for this: 1) the historical roles of BC municipalities, particularly through the Union of British Columbia Municipalities (UBCM), their province-wide association; 2) the role and influence of charitable organizations, who while defending their interests have struck strategic partnerships with local governments; and 3) the increasing reliance on gaming revenues on the part of provincial governments has required partnerships with local governments. This thesis concludes that while recognizing the limiting constitutional constraints of local governments in Canada, municipalities in British Columbia have nonetheless managed to assert a role in the development of public policy, with gambling policy being a good example of this development. ACKNOWLEDGEMENTS This thesis would not have been possible without the support and encouragement of Professor Patrick J. Smith and it is to him that my thanks are most indisputably due. Paddy's assistance in identifying resource material, his advice on questions of organization, grammar and stylistics, and his willingness to talk through ideas were invaluable. For this generous and insightful mentoring and for the sense of humour and patience that accompanied it, I am very grateful. I would also like to acknowledge all of those who agreed to be interviewed for this research. Their willingness to provide their time and expertise was very much appreciated, and greatly furthered the framing and development of this thesis. Lastly, recognition is due to my in- house editor, Una Walsh, who has partnered with me on so many journeys - this one being no exception. TABLE OF CONTENTS Approval ........................................................................................................................ii ... Abstract ............................................................................................................................111 Acknowledgements ......................................................................................................iv Table of Contents ...............................................................................................................v List of Figures AND TABLES ........................................................................................vi INTRODUCTION ..............................................................................................................1 CHAPTER ONE: Methodology. Research Design. Theoretical and Conceptual Framework .....................................................................................................6 (1) Methodological and Research Design ........................................................................6 (2) Theoretical and Conceptual Framework ...................................................................11 CHAPTER TWO: Background and Context ................................................................24 (1) Gaming Expansion in Canada: A legal and historical background .......................... 24 (2) Gaming in Canada: Financial and Social implications .............................................26 (2.1) Problem Gambling ............................................................................................. 30 (3) Gaming in Canada: The B.C. Response ................................................................... 37 (4) Gaming Legislation in other provinces and role for local governments .................. 46 CHAPTER THREE: Constitutional Background. Role of Municipalities. and Role of the Union of British Columbia Municipalities (UBCM) .................................52 (1) Historical Perspective and Municipalities' Legal Background ................................ 52 (2) Role of the Union of British Columbia Municipalities .UBCM ............................. 56 CHAPTER FOUR: The Role of Charities .....................................................................66 CHAPTER FIVE: Government Reliance on Gaming Revenue ..................................79 CHAPTER SIX: City of Vancouver Experience ...........................................................92 CONCLUSION ..............................................................................................................111 APPENDIX: LIST OF INTERVIEWEES ..................................................................115 BIBLIOGRAPHY and REFERENCE LIST ...............................................................116 LIST OF FIGURES AND TABLES Figure 1: Revenue from government-run gambling in Canada. 2002 ...............................28 Table 1: Gambling Revenue and Expenditures in Canada. 1992 to 2002. and Provincial Revenue Derived from Gambling in 2002103 ................................. 29 Table 2: Problem Gambling Rates and Spending by Provinces. 2003 ............................. 32 Figure 2: Percentage of Government Revenue Spent on Problem Gambling .................. 33 Table 3: UBCM Membership ............................................................................................56 Table 4: Distribution of Gaming Revenue to Charities in B.C. - 2003104 ........................ 69 Table 5: Net Gaming Revenues for Charities ($ Millions) ................................................ 74 Figure 3: Percentage of Revenue Derived from Gaming. 2003 ........................................80 Table 6: Number of Gambling Venues by Province .........................................................80 Table 7: Local Government Share of Provincial Casino Revenue in B.C. .......................81 Table 8: Use of Municipal Casino Revenue in B.C. - 200312004 ..................................... 84 INTRODUCTION Over the last decade, the discussion about gambling' policy issues in British Columbia (BC) has come to the forefront of public concerns. The casino industry has grown from a small number of charity-casinos holding low stakes, tables-only types of games and functioning a few hours a night, to a situation where 70-table and 1,000 slot casinos are functioning 24 hours a day,