NY state legislators support Seneca’s direct payment plan

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BUFFALO, N.Y. – The Seneca Nation of Indians has garnered the support of a number of legislators in its effort to make slot machine revenue payments directly to the municipalities instead of filtering them through the state.

New York Sens. Cathy Young, R-Olean, and George Maziarz, R-Newfane, have introduced legislation to resolve a dispute between the nation and the state over the exclusivity provision in the nation-state gaming compact.

The legislation was announced at an Oct. 17 press conference at the nation’s Buffalo Creek Casino attended by Seneca officials, Young, Maziarz, Assemblyman Joseph Giglio, R-Gowanda, and Assemblyman Mark J.F. Schroeder, D-Buffalo, who will introduce the bill in

the Assembly.

The legislation will allow local governments that host Indian casinos the option to receive payments directly from an Indian nation or tribe, rather than receiving such funds through the state.

“What we’ve seen, unfortunately, from New York state is a lot of red tape and bureaucracy and delays in getting the money out the door. That’s wrong because that hurts the communities,” Young said.

Young hopes the new governor, who will be elected next month, and leaders across the state will make a commitment to engage and work with the Seneca Nation better in the future.

“I look forward to continuing to work cooperatively with the Seneca Nation, finding solutions to economic issues that affect us all. The nation has been extremely responsive and has shown they care about our region’s well-being.”

The Seneca council voted in August to withhold slot revenue payments to the state, saying the state has violated the 2001 Class III Gaming Compact by allowing private businesses and state-run racetrack casinos to operate slot machines in Seneca’s exclusivity zone in western New York.

Seneca Nation notified the state of the violation last January, but repeated requests for a meeting to address the issue were unanswered, Seneca leaders said.

A few weeks later Gov. David Paterson’s office wrote to Seneca saying the nation was in violation of the compact by owing the state more than $200 million from 2009 and 2010.

It threatened to terminate the compact and shut down the nation’s three casinos in Buffalo, Salamanca and Niagara Falls.

Meanwhile, the municipalities have not received their shares of the slot revenues adding an extra layer of hardship to cities already experiencing a financial crunch because of the recession and high unemployment rates. Salamanca, for example, has laid off around half of its workforce, including public safety personnel.

The nation proposed to make the direct payments to the local governments while receiving credit from the state for such payments, but Paterson rebuffed the offer.

“This cannot be done,” Peter Kiernan, the governor’s lawyer, wrote to Seneca President Barry E. Snyder Sr. Oct. 14.

Kiernan offered that the state would make “advance payments” to the municipalities, but set conditions that would bypass any discussion, negotiations, or mediation, and would tacitly force the nation to concede that it – not the state – is violating the gaming compact.

“The harm to the host communities caused by the nation’s refusal to meet its obligations could be completely ameliorated if the nation were to make the payments that it is obligated to make. To assist the host communities, the state will advance payments to them on the conditions that the nation repay the exact amount to the state within two weeks of the state advances, that the nation agree to expedited arbitration of the issue of material breach of the compact, and that the nation stipulate as to the precise amount of exclusivity payments that it refuses to make,” Kiernan wrote.

Young and Maziarz said their legislation will protect the western New York economy by ensuring that the payments owed to the towns from locally generated casino dollars aren’t “held up due to the inability of the state’s leadership in Albany to resolve their dispute” over the gaming compact.

“I am proud to introduce this legislation in support of casino host municipalities and the ongoing efforts of the Seneca Nation of Indians to bring jobs and economic development to western New York,” Maziarz said. “It is vitally important that we find a long-term solution to this ongoing problem. The state must step up to the plate and meet its clear commitments to the Seneca Nation under the gaming compact, and at the same time local municipalities need an avenue to receive the revenue payments that they are entitled to in a timely manner. This legislation will accomplish just that, by eliminating the middle man and allowing payments to flow directly to local governments.”

It will also eliminate delays in payments to the towns by as much as 16 months.

Seneca Gaming Corporation officials said the tribe’s casinos have sent $475 million to the state since the tribe opened its first casino in Niagara Falls on New Year’s Eve of 2002.

One-fourth of that money goes to the local governments, but it typically takes the state a year or more to send it, a Seneca spokesperson said.

Giglio emphasized the importance of engaging in dialogue with the Seneca.

“We have shown western New York that diplomacy works and today we’re sending a strong message to Albany.”

Richard Nephew, the Seneca council chairman, applauded the legislators’ efforts to “assist in bringing plausible solutions to this unfortunate situation. The Seneca Nation is committed to working with New York leaders in responsible, effective ways and creating a stronger partnership. We believe the proposed legislation does just this.”