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Brace yourselves, Niagara Falls and Salamanca.
If you thought it was hard trying to survive without $81 million in revenue from the Seneca Indian casinos in your cities, think again.
It could soon get a whole lot worse: You might never see the money at all.
The Senecas are warning that, if the nation comes out the victor in its battle against New York State, the tribe doesn't ever have to make the payments that help the cities that are host to the casinos - Niagara Falls, Salamanca and Buffalo.
"The Nation fully anticipates that it will successfully show in the ongoing arbitration that the state violated the Nation's exclusivity rights under the compact and, therefore, the Nation has no obligation to make exclusivity payments to the state," Seneca President Robert Odawi Porter wrote in a letter to Niagara Falls Mayor Paul A. Dyster.
In its compact agreement with New York State that allowed the casinos, the Senecas agreed to pay a portion of slot machine profits to the host communities, but the state also agreed not to allow other casino gambling near the Indian sites. The Senecas stopped making the payments, arguing that the exclusivity had been violated with slot machines at local racing tracks.
Now the tensions have escalated, and Porter's letter last week is a marked change from earlier Seneca positions, Dyster said, one that has Niagara Falls and Salamanca worrying if they will ever receive the money.
In fact, if the Senecas win their arbitration with the state, the decision of whether to pay anything to the host communities would then be up to the Seneca Tribal Council, Porter said. So if Niagara Falls wants to see its money, it better tone down its language, he warned.
"The financial difficulty the city is experiencing could become more problematic for the city when taking into account the overtly hostile approach your recent comments reflect," Porter wrote.
The letter marked Porter's second retort in two days to Dyster's threat to pull fire service from the Seneca Niagara Casino, a move that escalated the conflict to a new level and shed light on just how much the city is suffering without the casino cash.
The threat came, after all, from Dyster, a former arms control negotiator for the U.S. State Department who has a reputation for a cool head and not a fiery tongue.
Even Porter, the Seneca president, told Dyster he had "never struck me as one to make brash decisions."
The Niagara Falls is owed $58 million, Salamanca is owed $23 million and Buffalo $9 million, but Buffalo has not budgeted for the casino money and thus is not as adversely affected. Salamanca and Niagara Falls count on the money for everything from roads to tourism projects to debt payments.
In fact, Dyster's threat was brought on, many say, by the city's looming financial crisis, which has become more evident in recent days as the mayor prepares his budget for the 2013 fiscal year.
Niagara Falls City Hall sources are pointing to Oct. 1 as the date when they will find out the mayor will propose layoffs.
If the money from the Senecas never came, "that would put us in a huge hole," Dyster said.
"We wouldn't just have bleak prospects looking forward, but now we're looking backward. That sort of situation is grossly unfair," he said.
Welcome to our world, Salamanca Mayor Jeffrey L. Pond said.
The Southern Tier city, home to the Seneca Allegany Casino, has been on life support since 2010, when the Senecas stopped making the payments. The city fired more than 60 percent if its work force and is asking for its second no-interest loan from the state to get through next year.
"We think we're going to get the $2.5 million, but we're out of money in January," Pond said of the loan.
If the state denies the loan, he said, "the city would probably cease to operate."
Pond hasn't made any threats to stop providing service to the Seneca Allegany Casino. After all, he said, city firefighters couldn't handle a fire there by themselves, anyway.
"We could not handle it with the staff we have," he said.
Porter, the Seneca president, said the cities should take up their problems with the state, which he believes is legally obligated to pay the host communities regardless of whether the Senecas pay New York.
The Senecas have said they have no obligation to make the payments because they believe the state violated the exclusivity contained in the New York-Seneca compact by allowing casino gambling on non-Indian lands near the Indian casinos.
A spokesman for Gov. Andrew M. Cuomo did not return messages left for comment about whether the state is willing to offer the Falls a loan similar to the one it gave to Salamanca. Dyster said there are "all kinds of discussions under way" between the city and the state but declined to comment further.
Arbitration between the Senecas and state is reportedly under way, but the two cities can't receive their money fast enough.
"Both the Seneca Nation of Indians and the state have a lot more ability to wait out the results of this than we do," Dyster said. "We've been a good citizen in this. Our backs our against the wall."

email: cspecht@buffnews.com