Seneca Nation Must Pay Up After Losing Arbitration Battle In New York

Written By Nicholaus Garcia on January 16, 2019

New York Gov. Andrew Cuomo has emerged victorious in a battle over revenue-sharing payments between the state and Seneca Nation of Indians.

In a ruling last week, an arbitration panel said the tribe must continue its payments to the state. The tribe stopped making payments in March 2017, claiming the compact agreement only lasted 14 years.

“We’re thankful the arbitration panel held a fair hearing of the facts and ruled in favor of the state and local communities that have been hurt by the Seneca Nation’s actions,” Rich Azzopardi, a senior advisor for Gov. Cuomo, told the Democrat and Chronicle.

A lengthy battle for Seneca Nation

The compact language, which guarantees casino exclusivity, is the root of the longtime disagreement.

The Seneca Nation of Indians struck a gaming compact with the state in 2002. The agreement granted exclusive rights to the tribe to build and operate Native American casinos in western New York.

In fact, the tribe operates Niagara Resort and Casino, Buffalo Creek Casino and Allegany Resort and Casino.

While both sides agreed to extend the compact, language regarding revenue payments did not change, resulting in the current predicament.

Now, state and local governments will share at least $220 million that has been withheld over the past two years.

Here is what Seneca Nation President Rickey Armstrong had to say:

“Despite the panel finding that the compact, as written, simply does not address the topic of revenue sharing beyond Year 14, a majority of the panel members determined that an obligation exists to continue revenue share payments to the state.”

According to the Democrat and Chronicle, the tribe will take the appropriate time to review and respond to the opinion. Both sides have until mid-February to figure out how the money will be paid.

Local government relief

The arbitration ruling could not come at a better time. In October, Cuomo’s administration had reached out to three cities to offer relief from the loss of much-needed gaming revenue.

Salamanca Mayor Michael Smith told reporters he was contacted by the governor’s office which inquired about a $9 million shortage in the city’s 2019 budget.

Additionally, Niagara Falls ($12.3 million) and Buffalo ($17 million) are each facing shortages heading into 2019.

At the time, Niagara Falls Mayor Paul Dyster viewed Cuomo’s efforts to help as a “stop-gap,” with one city council member calling the plan an election year gimmick.

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Positive outlook for sports betting

While not directly correlated, the ruling by the arbitration panel could help progress sports betting in the Empire State.

Ever since the US Supreme Court removed the ban on sports wagering, NY regulators have failed to introduce rules and regulations.

For the time being, with the tribal dispute, perhaps the state Gaming Commission could focus its time on creating rules to allow the four upstate NY casinos and Native American casinos to implement sports betting.

Nicholaus Garcia Avatar
Written by
Nicholaus Garcia

Nick comes from West Texas where he graduated from Texas Tech University with a degree in psychology. After a five-year stint in Chicago, where he wrote about local politics and graduated with a master’s degree in journalism from Columbia College Chicago, he moved to Washington, D.C. to write about issues related to gambling policy, sports betting and responsible gaming.

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