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Let the games begin: Mohawks concede on revenue sharing

Class II gaming is back on the agenda in Upstate New York. This time, it's the Cayuga Nation that is looking to open a Class II facility in the village of Union Springs on Cayuga Lake. Last April, the tribe purchased a former NAPA auto parts store and have since been renovating. The nation has also applied to NIGC for a gaming license and submitted its gaming regulatory ordinance to the commission for approval.

Village officials have vowed a vigorous fight, but may not have much in their arsenal. Under the Indian Gaming Regulatory Act, tribes do not need state or local consent for Class II gaming conducted on reservation land.

In 2001, a federal judge ruled in favor of the Cayugas in a land claim lawsuit and awarded them $247.9 million. That verdict and award remain under appeal. The Cayugas assert that because the former NAPA property lies within their 64,000-acre land claim area, it has reverted to Indian country through their acquisition.

Union Springs recently served a stop-work order on the renovation project, hoping to force the nation to follow local building and zoning regulations. Citing their status as a sovereign nation, the Cayugas defied the order. U.S. District Judge David Hurd then issued a temporary restraining order preventing the tribe from continuing to remodel, and the village from enforcing its laws on the project.

The Union Springs site is approximately five miles from where the Seneca-Cayuga Tribe of Oklahoma, which hopes to open a Class II gaming center of its own, is locked in a legal battle over similar issues - municipal authorities attempting to exert control over Indian land. Although a winning party in the land claim, the Seneca-Cayugas' "out-of-state" status adds a unique twist to its case - no tribe has ever crossed state lines for gaming purposes.

In other Cayuga Nation news, the Seneca County Board of Supervisors voted to reject the nation's Oct. 16 offer to settle its land claim, resolve tax issues and gain a casino in the Catskills, according to a report in the Finger Lakes Times. The Times gave no reason for the rejection, but said that supervisors looked to unite with neighboring Cayuga County to "present a united front" against the Indians. Area fire departments reportedly have raised "concerns about responding to fires" at nation properties because the nation does not pay local taxes.

These are disturbing developments. Given the nation's victory in its land claim litigation and its acquisition of a pair of commercial properties in the area, the Cayuga people are back to stay. The nation also appears well positioned to gain one of three Indian casinos in the Catskills, giving it a potentially lucrative revenue stream.

Rather than fight with the Cayugas, local officials would be better served to talk with them. Federal law and treaties gives the Cayuga Nation sovereignty over land they acquire within their claim area and recognize their complete control over their land without interference or taxation by lesser sovereigns, meaning governments from the state level on down. This is a reality that is not going to change.

Secondly, the tribe is sitting on potential gold mine with its prospects for a Catskill casino. While most of this money (if the casino comes to fruition) will be spent on tribal programs, it is likely that entrepreneurial investment will be made in the land claim area, meaning jobs for local residents and money flowing through the local economy.

The tax issue should really not be the insurmountable obstacle that some power-hungry local officials are making it. The Cayugas have already offered a sales tax parity plan to the state; it is not unreasonable to think that they might be willing to negotiate an arrangement perhaps along the lines of payments-in-lieu of taxes in return for municipal services. Such arrangements work well elsewhere.

Finally and most importantly, doesn't it make better sense to try to get along with your neighbors rather than "presenting a united front" against them?

Mohawk deal

A couple of weeks back, I gently chastised a plan by leaders of the St. Regis Mohawk Tribe to separate outstanding issues (land claim, taxes, casino revenue sharing) and negotiate with New York state on each of them individually. I called this a "mistake" but perhaps it was I who erred. Recent moves by the tribal government appear to keep them solidly in the gaming arena.

The tribe continues to maneuver for a Catskill casino, making what Chief James W. Ransom described as a "good business decision" by agreeing to share slot revenue from its Akwesasne Casino with New York state.

In return, the tribe could install 1,000 slot machines at Akwesasne, which it estimates could result in an annual take for the state of between $6 million to $9 million. The Mohawks would also receive exclusive rights to operate slots in the eight-county North Country region.

The state would waive claims to any revenue sharing dating back to 1999, when the casino opened. The state would also be responsible for compensating any affected local governments from its share of the slot revenue, under terms of the Nov. 13 proposal.

Revenues paid to the state will be governed by a sliding scale starting at 18 percent of the net drop (revenue before expenses but after winnings are paid) for the first four years. This increases to 22 percent for the next three years and tops off at 25 percent for the remainder of the deal.

The whole thing is of course contingent upon the state Assembly's retroactive ratification of the 1993 compact under which the Akwesasne Casino continues to operate. In June, the state's highest court ruled the compact invalid as it never received legislative approval. The state Senate has since approved the compact but Assembly Speaker Sheldon Silver had stalled the vote in that body in order to extract revenue from the tribe. The Assembly has ended its session for this year.

Approval from the Interior Department is required as well.

Tribal officials recently announced plans to layoff employees and downgrade the casino to a Class II operation. The proposed revenue-sharing plan, if accepted, will make these moves unnecessary.

The St. Regis Mohawks also announced a renegotiated partnership deal with casino operator Park Place Entertainment after their previous agreement, inked in May 2000, was nixed by the National Indian Gaming Commission (NIGC).

Under the new deal, Park Place will be paid 30 percent of the casino's pretax income to manage the proposed Mohawk Mountain Casino Resort in the town of Thompson, N.Y. This change brings the deal in line with NIGC regulations. The old agreement called for Park Place to get 30 percent of earnings before interest, taxes, depreciation and amortization.

The Mohawks agreed to pay Park Place a development fee of $15 million for its work in planning and building the casino, while the tribe assumes responsibility for constructing a $40-million parking garage. The parties also agreed to a no-compete clause within 125 miles of the Thompson casino.

As planned, the Mohawk Mountain Casino Resort will include a 750-room hotel with a 160,000-square-foot gaming floor, several restaurants, a spa and 15,000 square feet of meeting space.