HB set for $4m grants jackpot

Hawke's Bay's Heretaunga National Community and Sports Trust expects to increase its grants from gaming machine proceeds by more than 25 percent in the current year, in the face of industry fears that new rules will mean less money for organisations applying for the funds.
Trust administrator Jeff Drinkwater said more than $3 million was issued in grants by the trust in the last year, and projections for the current year indicated the total would approach $4 million.
The last year exceeded both the 33 percent minimum required by the Department of Internal Affairs, and the 37.12 percent now required.
The figures take into account increased business in Wairoa, where sites have withdrawn from trusts based outside Hawke's Bay because of concerns over the dispersal of proceeds generated in the town to national organisations and others outside the area.
Machines in the town had been switched off pending Department of Internal Affairs approval of licences relating to the change. Chances was already operating and the remaining sites, at the Clyde and Ferry hotels, were expected to be operating again before Christmas.
The Heretaunga trust was obligated to return proceeds to the Wairoa community from where they had come, Mr Drinkwater said.
"Being a regional trust with gaming sites throughout Napier, Hastings and Wairoa, the trustees realise the significant contribution gaming grants make to sporting, health, education, arts and cultural organisations throughout the area," he said.
"The money is raised in the area, therefore the donations are similarly returned for the benefit of the communities throughout Hawke's Bay and Wairoa."
Recent changes to the rules governing amounts that were able to be paid to venue operators in reimbursement of the wages and other costs of operating the machines made it "very difficult" to reimburse higher-performing sites for what the department called "actual, reasonable and necessary," expenses, Mr Drinkwater said.
The expenses included gaming duty and GST, repayment of loans for purchasing the machines, and administration overheads. The effect of rule changes could see some closing earlier than in the past, to avoid additional staffing costs, with the consequence of less proceeds to distribute at the grant end.
Trustees were aware of the grants' importance to many organisations, and were regularly reminded that some organisations could not operate effectively without the assistance provided.
The Charity Gaming Association's (CGA) claims that proceeds from trusts throughout the country could fall by up to $28 million, as a result of rule changes, have been dismissed by the department.
CGA chairman Paul East, who said a downward trend had already been noticed, said sites could ultimately close, leaving the industry to casinos returning proceeds to shareholders.
Gaming machine spending was about half of the $2.039 billion the department said was spent by New Zealanders on gaming machine, Lotto and other national lottery concepts, and TAB gambling in the latest financial year.`