A change to the accounting procedures of the Ontario Lottery and Gaming Corporation (OLG) implemented by the provincial Liberal government will cost those municipalities benefitting from slot profits
.
Many provincial agencies such as OLG have used use the Canadian Generally Accepted Accounting principles, but as of April 1 the OLG along with Ontario Power Generation, Hydro One, and the Liquor Control Board of Ontario will start using International Financial Reporting Standards.
As a result, the OLG must now account for its promotional programs as a cost. Those costs will come from the slots profits, meaning less money for the host locations.
OLG spokesperson Tony Bitonti confirmed that municipalities will receive one-time payments in 2011 as compensation.
“The old systems were included as operating expenses,” Bitonti told The Wellington Adviser, adding that "all government agencies are moving to those standards and the province cannot run two sets of books.”
Centre Wellington township Treasurer Wes Snarr feels this is nothing more than a tax grab by the province, likening the situation to a township citizen deciding to change his accounting practices and forcing the municipality to pay that person’s property taxes.
Sarnia Mayor Ed Bradley, whose municipality houses Hiawatha Horse Park, echoed Snarr's displeasure.
"If the OLG is making an accounting change, why should we pick up some of their cost of doing business?" Bradley rhetorically asked The Sarnia Observer. "They are responsible for that."
OHHA President Ken Hardy told Trot Insider that the new accounting practices should only affect the reporting of OLG revenue and not the allocation.
"We are obviously unhappy with the direction of the OLG," said Hardy. "OHHA and our auditors have been in contact with the OLG and we are currently waiting for them to provide additional information."