Barry Streek
God may not play dice with the universe, as Einstein famously posited, but a church group in Caledon has a different take. The Anglican Church in the sleepy town is a partner in a bid for a casino licence.
The church has taken this extraordinary decision after setting up an empowerment trust which has teamed up with major casino players. The trust was formed as part of the sale of church land which, if the bid is successful, will be part of the casino site.
The church’s partners in the bid are a top United States gambling enterprise, Century Casinos, and Fortes-King Hotels Group. These companies, together with the church-controlled Overberg Empowerment Trust, have aligned themselves with 180 previously disadvantaged investors from the region.
If all goes well for the partnership, the casino will be based on the site of the Overberger Country Hotel and Spa, best known for its hot, bubbly mineral pools.
Before selling the church land and entering the bid, the Caledon church had to run the gauntlet of the local and national Anglican Church establishment and secure the blessing of Archbishop Njongonkulu Ndungane.
The Archdeacon of Caledon, Richard Arendsen, said this week it was “reasonably” difficult to persuade the local community of Middleton and trustees of the Diocesan Trust to sell off the church land.
But in the end, Arendsen says, the trustees backed the deal on the grounds that the empowerment trust would be used to promote social development in Caledon and the Overberg region.
“I definitely say that this will make a big difference in Caledon where conditions spiritually and economically are low,” says Arendsen.
Keith Hendricks, a Caledon primary school teacher who is the chair of the investors, says the villagers’ biggest concern is what will happen to the region if the casino bid fails again.
“There is nothing new coming into the town. If it comes, there will surely be knock-ons for the community.”
Hendricks told the Western Cape Gaming and Racing Board that the original investors, who put up R287 000 in R1 shares, had maintained their belief in the huge opportunity that was coming their way. These investors had to put in a minimum of R400 and a maximum of R15 000 for the 300 000 shares on offer.
The offer, restricted to previously disadvantaged people, was taken up two- and-a-half years ago by people who ranged from schoolteachers to domestic servants.
The empowerment trust will own 50% of the preference shares in the R105-million casino development, and will therefore receive 10% of the profits.
“The deal was if we did not get the licence, they would get their money back,” says Leon Fortes, joint chief executive of the Fortes-King Hotels Group.
The trust, chaired by Arendsen, is designed to develop and fund job-creation programmes, welfare services, infrastructure needs, sports facilities, community facilities and other social programmes.
The other 50% of the preference shares in the bid will be owned by the Overberg Community Trust, formed by the Anglican Church as part of its agreement to sell land – “at a very reasonable price, below market value”, says Arendsen – for the new development.
The partnership suffered an early setback when British gambling giant Ladbrokes withdrew from the original casino bid, but subsequently consolidated itself into a new alliance. Both the Caledon trusts have already done reasonably well out of Ladbrokes’ exit from the bid – the Overberg Empowerment Trust was paid out an additional R250 000, while the Overberg Community Trust will get an automatic R1-million if the new bid is successful.
The 180 investors have already made R250E000 from their original R287 000.
The trust had done considerable investigation into social development projects by the time Ladbrokes pulled out of the bid, and it will be meeting again in January ahead of the public hearings by the gaming board on the casino bid.
Fortes used to think empowerment was mainly window-dressing, but his experience with the Overberg Empowerment Trust has convinced him otherwise.
“It really is a fascinating story,” he says. “I always thought empowerment was a bit of a financial handout, even if it was necessary. But what I have found is that the people in Empowerco [the Overberg Empowerment Company Limited] are not mainly concerned about personal financial gain. It is apparent they are concerned about the community and the jobs and the opportunities for the community.”
The Western Cape Gaming and Racing Board is expected to make a decision on the licence by April, after public hearings which the trust will address.