By a couple of measures, the Seneca Niagara Casino that opened in Niagara Falls a decade ago has been a failure for the city that hosts it. Not only has there been no spin-off development because of the casino, but the windfall it should have been to Niagara Falls has been strangled by a legal dispute between the Seneca Nation of Indians and the state of New York.
Still, in at least one critical way, the casino performed a function for which it was intended: It provided competition to the Niagara Falls, Ont., casinos that were already attracting American gamblers. In that regard, and given that the location was a tourist city, it made sense then to open a casino on the New York side, even though gambling brings with it a host of ancillary problems. It still makes sense.
It also made sense in that, by acknowledging the reality of casino gambling, New York State and the cities that hosted the Seneca casinos – Niagara Falls, Buffalo and Salamanca – would get a share of the profits from the slot machines. For Niagara Falls, that meant an additional $70 million over the first several years of operation, money that helped repave pothole-filled roads, fund its economic development efforts, clear blighted areas and launch a new tourism agency.
But then the money stopped. Testing the limits of the exclusivity zone that is part of the casino agreement with the state, New York began offering competition to the Senecas as close as Hamburg. The Senecas responded by withholding payments from the state, also cutting off the source of the city’s take from the casino.
That has been a killer for the city, depriving it of $60 million to date and helping to precipitate a financial crisis that nearly led to an 8 percent increase in property taxes. That matter is now before an arbitrator, but if the casino is to have any meaning to the people of Western New York, the matter has to be resolved in a way that allows those payments to continue.
What never made sense was the hope that plopping a casino in the middle of Niagara Falls would somehow spark other development in the city. It wasn’t going to happen, just as it didn’t happen in Atlantic City, N.J., and other regions devoted to gambling.
When gamblers enter a casino, they don’t leave to take in the sights. The consume their free alcohol, eat their tax-free meals and stay in the tax-free hotel. They spend the rest of their cash in the largely vain pursuit of free money.
Still, like other human temptations, gambling is here to stay. The best we can do is to temper its unfortunate consequences and use the money for worthwhile efforts. That was the promise made to Niagara Falls and it is a promise that has been broken. However the arbitration is resolved, Niagara Falls needs to be made whole. It has kept up its end of the bargain.