Gambling News by Gambling Headquarters

The moral dilemma is certainly not lost on Vern Gerhardt, the executive
director of Basketball Alberta. Gerhardt knows that without Alberta
government funding, the sports governing body he works for would be hooped
and amateur basketball in the province would suffer greatly. He also knows
that all the government money Basketball Alberta gets comes from gambling
revenues. "Is there an ethical problem? Yes. That's been the struggle around
here for years. But the way we look at it is without the money we wouldn't
be able to function. We wouldn't be around so there wouldn't be an ethical
or moral dilemma anyway." Basketball Alberta and hundreds of other
not-for-profit amateur sports groups all rely on the province for a
significant portion of their funding. While the level of that funding varies
widely from group to group, on average, most amateur sports organizations
receive at least a quarter of their revenues from the province, according to
Ian Reade, the former athletic director of the University of Alberta, who
did a research paper on gambling's dollar trail into amateur sports. While
some administrators like Gerhardt are well aware that the genesis of that
funding is gambling (casinos, video lottery terminals, slot machines, Sport
Select betting and other forms of government-sanctioned gambling), Reade
says others either aren't aware of the source or "don't want to know." But
the cold hard fact is that all of this government money comes from gambling
revenues, not just some of it. "Every single dollar that goes into amateur
sports from the Alberta government is gambling money," says Reade. "Amateur
sports and other not-for-profit organizations in the province are addicted
to gambling as much as the gamblers themselves." What may be even more
morally troublesome to some of the amateur sports groups is this statistic
gleaned from Garry Smith, a gambling research specialist at the U of A.
Smith points out that 40 per cent of the province's gambling revenue from
slot machines comes from the five per cent of the population classified as
problem gamblers, those with a real addiction. Figures from other forms of
gambling are not available. In any event, a significant portion of the money
going to amateur sports is helping feed problem gamblers' addictions.
"That's a fairly shocking statistic," says Smith. A closer look at the
system the government uses to funnel its gambling revenues to various groups
might help explain why some beneficiaries are confused about the origins of
that money. When an amateur sports group runs a casino or holds a raffle,
the tie to gambling is unmistakable. In 2005-2006, $254 million was raised
by charitable and religious groups conducting gaming events.

But after that the transparency can quickly blur.

Gambling revenues from Sport Select wagering and other lotteries, from VLTs
and from slot machines -- an estimated $1.4 billion for 2006-07 alone -- all
goes into something called the Alberta Lottery Fund.

>From there, money is allocated to 12 different ministries and to foundations
and grant programs to directly support volunteer and community-based
initiatives.

So when the Edmonton Soccer Association got $80,000 in two Community
Facility Enhancement Program (CFEP) grants for turf replacement, facility
construction and equipment through the provincial department of Tourism,
Parks, Recreation and Culture, that, in fact, is gambling money.

When the Edmonton International Baseball Foundation received $75,000 from
the Community Initiatives Program (CIP) for the 2008 World Junior AAA
baseball championships, again, that's gambling money.

And when the Capital City Gymnastics club got $3,665 to purchase two beams
and a mat from the Alberta Sport, Recreation, Parks and Wildlife Foundation,
you guessed it, that's gambling money.

The gambling revenues are funnelled through different departments and
programs, but no matter where they eventually come from, it's still gambling
money.

"It's a bit of a shell game," says Reade. "Sports organizations love the
idea they don't have to consider it as gambling money, they like to think of
it as government support."

The Alberta government also likes to talk about its "charity model" for
distributing gambling revenues, but that is a misnomer, according to the U
of A's Garry Smith.

Smith says that only about 20 per cent of the money from the Alberta Lottery
Fund goes to groups that might be considered non-profit, community-based and
charitable.

The rest goes to a variety of other groups and initiatives. For instance,
last year two one-time $35-million grants were given to Edmonton Northlands
and the Calgary Exhibition and Stampede. This year, $55 million is budgeted
for provincial highways, $25 million more for street improvements. More than
$60 million is budgeted to public and separate schools in the province, $1.6
million is budgeted for gaming research. And on and on and on. All of it was
from gambling revenues.

"They like to call it a charity model because it sounds good," says Smith.

Still, the money goes to a lot of groups that provide vital community
programming, including amateur sports organizations, who really depend on
that funding.

"Every amateur sports organization struggles financially. They survive but
they don't thrive," says Reade. "Any ethical question goes away when there
is no alternative."