ALBANY – Gov. Andrew M. Cuomo has upped the ante with the Seneca Nation of Indians.
He is giving the Senecas until the third week of June to resolve its $600 million casino revenue-sharing dispute with the state or he will push for the right for a commercial casino to locate in Western New York.
In announcing some details of his plan for expanding casinos in the state Thursday, Cuomo said he remains less than optimistic the Senecas will come to the table with a deal before the State Legislature end its session June 20. That is when lawmakers hope to have a final casino expansion plan to vote on so that the matter can go to voters in a statewide referendum this fall.
“You would need to be dubious with the Senecas,” Cuomo said of the prospects for ending the several-year-old dispute in which the tribe has withheld revenue to the state and the host communities of Niagara Falls, Buffalo and Salamanca. The Senecas claim that the state has permitted new gambling in the Senecas’ exclusivity zone that stretches from east of Rochester to Lake Erie.
The governor proposed six regions of upstate that would be eligible for new casinos if the voter referendum passes. But on a map he showed to reporters, three areas of the state – Western New York, Central New York and Northern New York – had question marks stamped on the Powerpoint slide show. Those are areas now home to Indian tribes with casinos, including the Senecas.
The governor said the state would honor casino compacts in “good standing’’ with the tribes by not placing casinos in their regions.
But Cuomo made clear the status quo between the Senecas and the state will not continue.
“That is currently not a contract in good standing,” Cuomo said of the Seneca compact to operate the three casinos in Western New York.
Cuomo said the state has launched “dozens of attempts” to resolve the dispute with the Senecas over the years.
The Seneca Nation declined to comment, citing a gag order imposed on the tribe by an arbitration panel.
The governor said he also is trying to get separate deals with the Oneida Indians in Central New York to start making revenue-sharing payments and the St. Regis Mohawks in Northern New York to resume making their payments. If they do, then he would seek to ban new commercial casinos from locating in those areas.
Cuomo’s casino expansion plan does not specify locations for possible casino sites upstate, though he has said he favors putting one in Niagara Falls, near the existing Seneca facility, if talks with the tribe are not resolved. The sides are in binding arbitration to resolve the revenue payment dispute, but Cuomo said he wants an answer before lawmakers end the 2013 session so Western New York will know whether it is eligible for a new casino.
Cuomo wants the first three casinos, out of seven that voters might be asked to approve, to be located upstate.
Where the remaining four might go in the future is uncertain, but he wants lawmakers to back his new effort to prohibit casinos in New York City, Long Island or the New York City northern suburbs for five years. That will give an incentive for commercial casino operators to locate upstate as part of a plan that he believes will attract thousands of jobs to the region, he said.
The new plan also calls for all counties in one of the selected regions to share in casino revenue-sharing proceeds. So if the Senecas and the state end their dispute, counties west of Route 14 – the eastern boundary of the Seneca exclusivity zone – would get a part of the Seneca payments that would otherwise been destined for the state, Cuomo said.
Cuomo said Niagara Falls, Buffalo and Salamanca would be held harmless and still receive scheduled revenue-sharing payments.
But much is left up in the air with the governor’s plan.
He wants to let the marketplace, for instance, decide how much commercial casino operators might be taxed on their revenues, instead of setting precise “takeout" rates as is done in Las Vegas, Atlantic City and for New York’s nine racetrack-based casino operations, including the Hamburg and Batavia harness tracks.
The Cuomo plan has morphed from having one of his state agencies – the State Gaming Commission – select future casino operators to a panel of outside real estate, economic development and other financial executives who would serve for a temporary period of time. That panel would consider a range of casino development criteria, including upfront franchise fee payments to the state, annual tax rates, job creation and level of “destination’’ development plans for a site.
The governor’s plan comes just days after John Bonacic, the chairman of the Senate Racing and Wagering Committee, said Senate Republicans are working on a casino expansion plan that would honor the Seneca Nation’s exclusivity arrangement – with or without a revenue-sharing deal between Cuomo and the tribe.
By trying to engage deals with the three Indian tribes, Cuomo appears to be trying to reduce the flow of money in a statewide casino referendum campaign that might come from casino interests looking to protect their investments. Out-of-state non-Indian and tribal casinos already are expected to pump money into anti-casino expansion efforts in New York, and the Senecas and Oneidas, in particular, have deep enough pockets to finance a healthy opposition campaign if the matter heads to voters this fall.
For the governor, the casino issue has increasingly been portrayed as an upstate economic development tool. He envisions thousands of jobs being created at new resorts as part of overall efforts to lure tourists upstate from New York City and other states.