B.C. arts and theatre groups are scrambling to pay debts and said yesterday that they are concerned about their survival because promised multi-year funding from provincial gaming revenue has evaporated.

The groups, which include the B.C. Children’s Festival and Vancouver’s Touchstone Theatre, say they were promised funding over three years and prepared their budgets accordingly.

The government, however, contends that funding was not guaranteed and that priorities for gaming grants include things like programs that provide hot lunches for underprivileged children.

Katrina Dunn, artistic director of Touchstone Theatre, said her company enjoyed one of its best seasons, but now find itself wrestling with its largest deficit in 35 years.

She said they were promised $120,000 over three years. They received $40,000 last year, but haven’t received anything for this year and are worried that they won’t receive any next year.

“Contracts are signed, programming is done,” Dunn said. “It’s a very large portion of our operating budget so it’s a huge impact for Touchstone. Shows will be cancelled, people will be laid off.”

Housing Minister Rich Coleman, whose ministry is responsible for distributing gaming grants, said the ministry has “technically” reduced the amount of funding that arts groups receive from gambling revenues.

He said the three-year grants applied only to the applications, meaning that groups wouldn’t have to apply for the same grant every year and thereby reduce operating costs.

“It didn’t guarantee that the grant would be there every year,” he said.

New Democrat MLA Spencer Herbert said the grants represent “signed contracts” that the government is not honouring. He said some groups were considering legal action.

Coleman said his ministry funded $10 million in gambling revenue to the B.C. Arts Council, which also provides artistic grants.