ALBANY – Gov. Andrew M. Cuomo is raising the possibility that Seneca casinos could close in three years if the Indian nation cannot reach an agreement to start paying nearly $600 million in stalled slot machine revenue-sharing payments to Albany.
“Under these current circumstances, I don’t see how any state official could support extending the compact when the other side hasn’t paid,” Cuomo said Thursday of the compact with the Senecas, which expires in 2016.
“If there is no compact, they have no authority to operate,” Cuomo said.
The governor commented during an event at the State Capitol announcing he had struck a deal with the leader of the Oneidas to give that Indian nation an exclusive gambling franchise for a large portion of Central New York in return for settling a long-standing land claim and also paying the state 25 percent of slot revenues at its Turning Stone casino resort.
Cuomo suggested that the Senecas appear more concerned with the expiration of their compact, signed a decade ago by Seneca leaders and then-Gov. George E. Pataki, than with the plan being worked on by Cuomo and lawmakers to permit up to seven new, non-Indian casinos in the state.
“The real question with the Senecas is: Their compact expires,” he said.
The agreement between the state and Senecas for three casinos in Western New York was approved in 2002; it called for a 14-year term with a seven-year renewal option.
Two weeks ago, Cuomo floated an upstate casino-expansion plan that identified three areas that would not be eligible for commercial gambling if the Indian casinos in those regions come to terms on disagreements with the state.
The deal with the Oneidas means that a large section of Central New York will now not be eligible for any new casino expansion.
If the Senecas do not come to terms with the Cuomo administration, the governor said, Western New York will be eligible for a new casino. He has floated the idea of putting one in Niagara Falls near the existing Seneca facility.
Cuomo said that there has been “no progress to speak of” in talks with the Senecas since he floated that idea two weeks ago. The state and the Senecas are in arbitration over the revenue-sharing dispute, which Cuomo said has caused “significant hardship” for localities in Western New York that relied on the casino funds.
The state, under the compact, gets 25 percent a year from Seneca slot machine revenues; Albany, in turn, shares a portion of that money with Niagara Falls, Buffalo and Salamanca, homes to Seneca casinos.
“For the Senecas, it’s more just a question of the basic standing of the relationship and their ability to honor a contract, and does the state want to do business with that type of experience, which will be very relevant when that compact expires in 2016,” Cuomo said.
The Senecas did not have an immediate comment, and they have said little or nothing since Cuomo has sought to raise public pressure.
The Oneida deal, according to the tribe’s representative, Ray Halbritter, would provide the state about $50 million in slot machine revenue-sharing funds. New York would then share the proceeds with local counties.
Halbritter said the Oneidas also would impose a new tax on cigarette and gasoline sales – the proceeds of which they would keep – to bring those products closer to parity with nearby non-Indian retail outlets. Details on that provision were vague, but Halbritter said cigarette and gasoline products sold on Oneida lands would be “very close” to those of off-reservation retailers.
The Oneidas’ wealth has soared since the casino, along with hotels, golf courses, restaurants and entertainment space, was approved by then-Gov. Mario M. Cuomo, father of the current governor, in 1994.
Unlike the Senecas, the Oneidas never had to make revenue-sharing payments to the state.