The AGCO receives its annual spending authority from the Ministry’s printed estimates, as approved by the Ontario Legislature. The AGCO is funded from a combination of revenue from the Consolidated Revenue Fund (CRF) and recoveries.
Multi-Year Operating Budget
|
Expense Category |
2022-23 Budget* |
2022-23 Forecast* |
Variance |
2023-24 Budget |
2024-25 Budget |
2025-26 Budget |
|---|---|---|---|---|---|---|
|
Operating |
||||||
|
Salaries and Wages (S&W) |
76,016.70 |
71,212.25 |
4,804.45 |
75,946.00 |
75,837.40 |
75,837.40 |
|
Benefits |
15,467.50 |
15,219.44 |
248.06 |
15,761.30 |
16,143.70 |
16,143.70 |
|
Other Direct Operating Expenses |
||||||
|
Transportation and Communications (T&C) |
3,347.60
|
1,387.76
|
1,959.84
|
3,345.80
|
3,340.60
|
3,340.60
|
|
Services
|
22,062.00
|
18,982.33
|
3,079.67
|
13,268.80
|
13,261.50
|
13,261.50
|
|
Supplies and Equipment (S&E) |
2,069.60
|
1,145.42
|
924.18
|
2,067.90
|
2,062.60
|
2,062.60
|
|
Transfer Payment |
1.00 |
0.00 |
1.00 |
0.00 |
0.00 |
0.00 |
|
TOTAL Gross Expenditure |
118,964.40
|
107,947.19
|
11,017.21 |
110,389.80
|
110,645.80
|
110,645.80
|
|
Less: Recoveries |
79,094.70
|
49,670.54
|
29,424.16 |
71,123.20
|
71,574.30
|
71,574.30
|
|
Base Budget from Government |
39,869.70
|
58,276.65
|
(18,406.95) |
39,266.60
|
39,071.50
|
39,071.50
|
|
Capital |
3,774.10 |
1,688.10 |
2,086.00 |
471.20 |
489.60 |
1,234.70 |
|
Revenue** |
38,365.70 |
36,967.77 |
1,397.93 |
67,431.02*** |
40,284.33 |
40,284.33 |
* 2022-23 Budget and Forecast (as of Q2 2022-23) do not include expenditures paid on behalf of iGaming Ontario (iGO). Forecasted iGO direct costs incurred by the AGCO on behalf of iGO are $8.5M.
** This represents fee revenue that goes into the government’s Consolidated Revenue Fund (CRF).
*** The increase in revenue in the 2023-24 Budget is due to the adoption of a new Public Sector Accounting Standards (PSAS) accounting standard, PS3400 – Revenue recognition. There may be changes in timing of revenue recognition depending on the nature of the revenue.
AGCO Revenue – Key Explanations
- The revenue forecast in 2022-23 is lower than the 2022-23 Budget mainly due to lower forecasted Cannabis revenue for Store and Operator licenses. The incremental decrease in Operator licenses is due to a forecasted decline in new retail operator applications as well as renewals. The incremental decrease in the store licenses is due to a forecasted decline in retail store renewals.
- Over the next three fiscal years, revenue is expected to increase steadily as industries continue to recover from the COVID-19 pandemic and as demand for new applications and renewals continues.
AGCO Expenditures and Recoveries – Key Explanations
- The overall AGCO gross expenditure variance in 2022-23 of $11.0M is due to:
- Forecasted underspending in Salaries and Benefits of approximately $5.0M, mainly as a result of hiring delays and vacancy management.
- Forecasted underspending in Transportation and Communication and Supplies and Equipment, used to offset pressures in Services, resulting in net underspending of $1.4M across the three expense categories.
- The 2022-23 Services budget includes $8.1M related to the cost of external service providers used to assist in Eligibility Assessments for Gaming Modernization and private cannabis retail. $3.6M is forecasted to be spent in 2022-23 while the remaining funds will be allocated to 2023-24 through a 2023-24 Strategic Planning Process (SPP) submission.
- AGCO recoveries are forecasted to be lower than budget in 2022-23. Due to the current funding structure and authorities in place, the AGCO is not able to fully offset the cost of its regulatory activities which has resulted in an ongoing, annual deficit.
AGCO Capital Assets – Key Explanations
- The Capital budget includes iAGCO betterments to support and enhance iAGCO for the new iGaming line of business, liquor reform, and other changes (e.g., cannabis renewals).
- The Capital budget also includes IT hardware for the purchase of personal computing devices, mainframes, data network equipment, and storage devices.
- A request to transfer $2.1M in Capital Assets budget from 2022-23 to 2023-24 was submitted in the 2023-24 SPP.