Thursday, March 22, 2012

Cue the circus music

The long, strange saga of the Telus Park naming rights deal for B.C. Place Stadium won’t end.

How did it start?

We know that the stadium wasn't finished in time for the Sept. 30, 2011 reopening, but the show went on anyway.

Telus crews, under the guise of the top secret "Project Frog," were in and out of the construction site throughout the summer to install the wi-fi and mobile phone antennas and video screens, but often had to hurry up and wait. B.C. Pavilion Corporation and PCL Constructors Westcoast had other priorities. The application of the fabric roof was way behind schedule, delayed from February to July because the Quebec steel contractor Canam and French cable installer Freyssinet couldn't get along and cables and machines were failing or breaking.

The reopening came and went. So did the marquee event, the 99th Grey Cup. The name remained B.C. Place Stadium. Telus had incurred extra costs and the value of the naming rights had diminished. It reasonably wanted a better deal than the one originally agreed.

Meanwhile, the B.C. Liberal Party ended 2011 with its "Risky Dix" attack ad campaign and began 2012 by soliciting various frequent donors to build a war chest for the Port Moody and Chilliwack by-elections. Telus, which gave $352,407.35 since 2005, declined.

The Liberals were miffed after awarding Telus the $1 billion, 10-year omnibus telecommunications contract in summer 2011 in controversial fashion.

The Liberals were hammered by Telus competitors, chiefly Bell, Rogers and Shaw, who accused the government of violating trade agreements and government procurement rules. The tendering process for nine different contracts lasted more than two years before the government's sudden, surprise bundling of the entire business into one deal, for one company.

Despite the party's ties to Telus, Premier Christy Clark has telecommunications connections of her own.

Not only is Clark a good friend of Bell-sponsored, Vancouver Whitecaps' owner Greg Kerfoot, but she was formerly employed as a CKNW radio talkshow host by Corus Entertainment, a company controlled by Shaw Communications.

In fact, Clark met on Jan. 30 in the Premier's Vancouver Office at the World Trade Centre in Canada Place with Shaw CEO Brad Shaw.

Shaw Communications is contesting Telus’s application to trademark Optik TV. Shaw also owns Global TV, which boasts the best-rated local TV newscast in Canada on Global BC.

As if to make matters worse, Telus is suing the B.C. government. Deputy Minister of Finance Peter Milburn denied Telus's appeal for a Social Service Tax refund on Feb. 7, according to the March 9-filed B.C. Supreme Court documents below. Telus claimed it errantly paid or self-assessed $306,311.61 in taxes after the 2004 purchase of servers, operating software and maintenance from IBM, Lucent and Sun Microsystems. At least $96,580.40 was not refunded and remains in dispute.

Telus sues B.C. government for a tax refund

While Clark has been noticeably quiet during a week-long break from the Legislature (after mis-handling the mess and message the previous week), some Liberal MLAs have used their time off to arrange photo opportunities with community newspapers to dole funds from a $30 million pot Clark announced at the Union of B.C. Municipalities convention on Sept. 30, 2011 in Vancouver.

MLAs Randy Hawes and Marc Dalton went to Mission to announce $185,000 for dehumidifiers at the Mission Leisure Centre’s three rinks. Hawes and Dalton told Abbotsford Times reporter Christina Toth that the money was left over from the stadium’s renovation!

MLAs Randy Hawes (Abbotsford Mission) and Marc Dalton (Maple Ridge Mission) met with the district's mayor Ted Adlem and Coun. Nelson Tilbury at the leisure centre to hand over the cheque.

The largesse comes from monies left over from the $563-million renovation of the B.C. Place roof. When the project came in $30 million below the last estimated cost, Victoria decided to disperse those dollars to recreation projects around B.C., explained Hawes.

"We just got the information on the weekend," he said.

Preposterous! Minister responsible for B.C. Place Pat Bell told me in a Jan. 30 interview: “We’re probably three or four months away from being able to roll out the final numbers.”

"For them to claim this is surplus money from a project millions of dollars over budget is a real stretch," NDP critic Spencer Chandra Herbert told me. "There is no surplus because they have no financing plan to pay for the project."

UPDATE, 5 p.m., March 22: Hawes claims "we are under the final budget for the stadium refit" (though he didn't mention any numbers). But he goes on to say:

"I either misspoke or was misunderstood. The recreation funding of $30 million for more rural communities is not from the under budget amount from BC Place. That was capital funding and from an accounting perspective, this funding must be from operating funds. I have looked at this funding as a way to allow some communities that might not benefit from the stadium remake to feel they have some benefit. I do feel a bit foolish having tied the funding directly to the under budget amount on the stadium. Incidentally, while the total recreation grant funding is $30 million, that does not mean the stadium savings was $30 million. Mea culpa."

UPDATE, 7 p.m., March 22: I asked Hawes for proof that the B.C. Place project was under budget. Not surprisingly, he has none.

"I don't know what the numbers are but Pat Bell has said numerous times that we are under budget. I believe the final numbers are still to come in."

Work continues at the stadium. A new fence is being erected outside the west side service entrance. The level 1 media entry is under renovation (and wasn’t complete for the Whitecaps’ home opener).

This is the same stadium that is now faced with a $35 million to $40 million shortfall because of the nixed Telus naming rights deal. The same stadium where an operating deficit of $49 million has been forecast for 2012-13 to 2014-15, according to the latest Service Plan.

The same stadium where grease leaks from the support cables have damaged the roof and could cost $10 million to repair.

The same stadium that will be the subject of an 85-day B.C. Supreme Court trial expected to begin in October 2013 between Canam and Freyssinet. Canam is suing for $26.15 million, Freyssinet wants $6.5 million. B.C. Pavilion Corporation is a defendant in the Freyssinet lawsuit.

Here's my modest proposal: move the B.C. Liberal caucus and its staff under the expensive big top at B.C. Place. They are clowns, who are running this province like it’s a circus.

Cue the circus music.

Tuesday, March 20, 2012

PlayNow to be "Paddy-powered"

It's not every day that I receive 950 pages of documents via Freedom of Information.

It's doubly special when it arrives before St. Patrick's Day and concerns one of Ireland's biggest companies which is cheeky enough to show nudity in its corporate reports. I'm referring to Paddy Power, the Dublin-based retail and online gambling giant that is now a key partner with the British Columbia Lottery Corporation.

Read my story here about this timely relationship and the next step in B.C. gambling expansion in the Vancouver Courier.

Paddy Power wants to grow and enter the North American market. BCLC plans to re-launch its PlayNow legal online gambling website this summer (when the 2012 Olympics will occur) with a heavy emphasis on sports and event betting. Just in time for the federal government to relax Canadian gambling laws because of an NDP Member of Parliament's private member's bill.

By summer, it should be legal to bet on a single sporting event in Canada through legal channels, such as BCLC and the other provincial government monopolies. With this comes the legitimate concerns that more teenage boys will find a way to gamble and eventually become addicts. Read about the science here and watch the Gambling Boys documentary here. In addition to health, there are other worries about the proliferation of gambling and the risks of match-fixing, as chronicled by author Declan Hill.

Sports fans in Canada (particularly British Columbia) will be happy. But deficit-plagued governments across North America are revenue-hungry and, when it comes to gambling, tend only to see the benefits side of the ledger, not the costs.

All 950 pages are posted below. The file is so long, that I have included this list of highlights for your ease of browsing (with page numbers according to the tabulation).

Pages 2-3: The B.C. Gaming Policy and Enforcement Branch registration approval for Paddy Power.
Pages 4-5: GPEB regulations (note how sections b, h, j, m, n and p do not apply to Paddy Power).
Page 6: Paddy Power's B.C. registration certificate.
The next 70 pages deal with Paddy Power's software provider, Playtech.
Page 76: 2010 Paddy Power annual report. (Note the iPad motif, a nod to mobile gambling on tablets).
Page 242: 2009 Paddy Power annual report.
Page 378: 2008 Paddy Power annual report.
Page 482: 2007 Paddy Power annual report (inspired by the hilarious Father Ted Channel 4 sit-com. The report contains a well-endowed woman in a wet T-shirt on page 491 and an Elvis impersonator in front of Buckingham Palace on page 493).
Page 586: 2006 Paddy Power annual report. (The company marked its 18th year with a Poker magazine cover marking a Paddy Power-sponsored world record strip poker tournament on page 588, rugby player Donnacha O'Callaghan losing his shorts and a streaker losing more on page 589).
Page 688: 2005 Paddy Power annual report.
Page 774: Playtech news releases.
Page 776: Malta Lotteries and Gaming Authority corporate structure.
Page 777: Paddy Power news release on entering the French market.
Page 781: Article about Online Gaming in Kahnawake from the Nov. 6, 2011 Gaming Law Review and Economics by Kahnawake Gaming Commission lawyer Murray Marshall.
Page 791: internal GPEB email and records about the investigators' trip, travel arrangements and expenses to Dublin to inspect Paddy Power's operations.
Page 810: U.K. Gambling Commission: Licensing, compliance and enforcement policy statement.
Page 834: U.K. Gambling Commission: The Gambling Commission's betting integrity decision making framework.
Page 851: Isle of Man Gambling Supervision Commission: Online Gambling Guidance Notes for the Prevention of Money Laundering and Countering of Terrorist Financing.
Page 943: Credit Suisse Private Banking Security Agreement.

Paddy Power to re-power B.C. Lottery Corporation online gambling

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