Gov’s Bad Bet
Casino fiasco proves folly of neglecting Native tribes
FROM the time of the Dutch purchase of Manhattan, Native Americans have gotten one raw deal after another. So imagine the delight of the Seneca Nation of Indians’ tribal leaders when they realized that their gaming compact with New York state — signed in 2002 and automatically renewed last December for another seven years — did not include a revenuesharing payment schedule beyond 2016.
The agreement between the state and the Senecas — a Western New York tribe — provided the state with a percentage of the revenues from the casinos’ slot machines on a sliding scale: Years 1-4 at 18 percent, Years 5-7 at 22 percent, and Years 8-14 at 25 percent.
Here’s the catch: In 2012, Gov. Cuomo and the Senecas agreed to an extension of the gaming compact through 2023, after a dispute over gambling exclusivity. How suprised Cuomo must have been when, on March 22, Seneca Nation President Todd Gates announced, “Our obligation to the state has ended.”
He wouldn’t have been surprised if he’d read the contract as closely as the Seneca Nation did. The agreement may go through 2023, but the payment schedule stops at 2017. Oops.
Back in 2012, Cuomo proposed expanding gaming across the state in an effort to jump-start the economy — especially Upstate counties — and to save the horse-racing industry and boost revenue.
The Seneca tribal government felt — understandably — that Cuomo’s proposed expansion of three racinos in Western New York threatened their gamblingexclusivity rights. In response, they threatened to withhold revenue from the slots. The current version of the contract extension avoided a crisis.
Over the past 14 years, the Nation has paid the state more than $1 billion in revenue sharing. Of this, the state then reallocated about $330 million to local communities in and around gaming facilities.
In announcing their decision to cease payments to the state, Seneca leaders promised to continue ponying up for local government services and to share a portion of revenue with host communities. In the past 14 years, the Seneca Nation has invested well over $1 billion in construction and quality-of-life improvements in Western New York — over $624 million of that spent on Niagara Falls alone. When he first came into office, Cuomo promised to collect upwards of $130 million in Indian tobacco and gasoline taxes. But federal law bars the state from taxing Native Americans or businesses headquartered on Indian lands.
A few years ago, I took Cuomo to task for failing to include the Seneca, Oneida and other members of the Six Nations tribes in his economic-development plan- ning beyond ensuring the state got its casino-slots cut.
At that time, I wrote that an honest assessment should compel Cuomo to convene an Indian Nations economic summit. The governor has shown a penchant for holding all sorts of summits — beer, wine and yogurt being a few of his favorites, apparently.
Seneca leaders and host communities have good reason to work together and to be good neighbors. In 2014, Seneca Gaming Corp. spent nearly $43 million with Erie County vendors, $3.2 million with Cattaraugus County vendors and more than $6 million with Niagara Falls vendors.
Similarly, the Turning Stone Casino, operated by the Oneidas, has spent $2 billion with outside vendors since opening nearly two decades ago. In 2011, they did $294 million in business with outside suppliers.
Treating New York’s first people as less-than-second-class citizens when it comes to our state being “open for business” is counterproductive. Cuomo can save face by meeting with Gates and other Seneca leaders. In fact, Cuomo should take the opportunity to convene a summit of the Six Nations.
This episode should serve as a wake-up call for Cuomo to stop treating the Six Nations as an afterthought or as merely another source of tax cash. Now that he’s lost his leverage over the Senecas, maybe he will.