Lawsuit, bribery allegations causes more KED delays in Sudbury

Sudbury — Gateway Casinos has asked Greater Sudbury to delay work on the Kingsway Entertainment Centre because of a lawsuit by a local group aimed at stopping the project.

Gateway also said city council's request to have the Ontario Provincial Police investigate bribery allegations has created too much uncertainty to proceed right now.

"Site grading work at the Kingsway Entertainment District (KED) site, which was scheduled to begin this week, is being delayed at the request of Gateway Casinos," the city said in a news release Monday.

"Gateway advised the city they are pausing site grading work until additional clarity is available about the resolution of ongoing legal matters related to the Minnow Lake Restoration Group lawsuit and city Council’s request for an investigation into claims made by Councillor Montpellier, which the Greater Sudbury Police Service has asked the Ontario Provincial Police to investigate."

In a statement, Gateway said it was still committed to the project.

"Gateway remains supportive of the KED project and continues to invest significant time and resources into the project as we believe it is the best location for a premier gaming and entertainment facility in Sudbury," spokesperson Rob Mitchell said, who said Gateway has spent approximately $3.9 million so far on the project.

The fact the Minnow Lake suit won't be heard in court until April 2022, added to the OPP investigation has created too much "uncertainty around the project," Mitchell said.

"It is not commercially reasonable for Gateway to continue to provide additional significant funding to the next phase of the project until these ongoing challenges are resolved and the entire scope of the project is confirmed to be moving ahead," he added.

"Gateway hopes for a quick and successful resolution of the outstanding issues, and in the meantime we continue to work collaboratively with other project stakeholders."

Developer Dario Zulich released a statement on the delay Tuesday afternoon.

"The concept of the KED was founded on partnership," the statement said. "It’s all for one and one for all. What is not good for one of us, is not good for any of us. As a matter of principle, all partners must assist each other where possible as we move at the speed of business, post COVID. As such, we must respect Gateway and its position on risk assessment.

"The KED group has had to adjust our collective plans over the past few years to meet many challenges head on, including COVID," the statement continued. "Council has repeatedly supported the KED at every challenge. All partners, including the hotelier, remain committed to their respective roles at the KED.

"Once these last few obstacles are overcome, we will continue forward together and ultimately see this transformational project for Greater Sudbury through to its successful completion."

For its part, the city said staff are meeting with project partners this week to review the information and determine effects on project scheduling and deliverables.

"Staff will develop recommendations and next steps for council’s consideration," the release said.

"The city is very confident in its position related to the Minnow Lake Restoration Group lawsuit, as demonstrated by the successful outcomes of the LPAT and Superior Court case decisions."