Slot revenue payments will no longer be paid by the Seneca Indian Nation to the state of New York.
In every state, casinos must pay certain taxes based on a number of factors including location, state regulations, etc. Casinos have to make these payments in order to be operating in a legal manner as well as staying try to negotiations with local municipalities. In the case of tribal gaming, Native American tribes will create agreements with the state in order to offer casino gaming. Usually, instead of taxes, the tribe will pay a portion of their casino revenues to the state in exchange for offering certain gaming types.
In New York, the state has benefited from monies provided by the Seneca Indian Nation and their three venues located in Upstate New York. In 2002, a compact was signed between the tribe and the state which included payments made via slot revenue earnings. The tribe paid 25% of their slot revenues which has resulted in more than $1.4 billion going to the state in the past 14 years. The tribe has now decided that they will no longer be offering this payment.
No More Compact
The payments were made by the tribe since 2002 due to a compact signed that same year. The tribe has three casinos, with locations in Buffalo, Niagara Falls and Salamanca. The host communities provide municipal services to the casinos in exchange for money provided as part of the compact. The compact had a revenue-sharing requirement via the slot games for a time frame of 14 years. The tribe has stayed true to the compact and now want to stop making payments.
The compact did say that that an extension period could be created but the tribe seems to not be interested in extending their partnership with the state. Todd Gates, the President of the Seneca Nation, spoke with reporters after the announcement, stating that the nation would like to make payments to the host city where the casinos are located in exchange for municipal services to continue. However, the obligation to the state is no longer valid.
The Compact Agreement
When the compact was signed, the 800 page agreement had the sharing requirement set for 14 years. Other parts of the compact are still in place as the agreement was signed to continue throughout 2023. Rich Azzopardi is the spokesman for Governor Andrew Cuomo who stated that it is clear that the payment structure is in place, talking about the contract and a memo from 2013 when signing took place to settle a dispute.
According to Azzopardi, if new leadership, meaning Gates, has questions, or a different interpretation of this, they have not shared that with Cuomo and the governor’s office is willing to meet and discuss any issues. According to Gates, the tribe would like to negotiate new financial agreements with the host cities and not the state.
Michael Smith is the Mayor of Salamanca and also a member of the Seneca Nation. The Mayor stated that leaders of the tribe have told him privately that they had plans to stop the payments and he was told not to panic. Smith stated that the leaders told the host cities to not panic as they would be taken care of and he believes they will be.
Despite his feeling that the city will be taken care of, Smith does say that he does not plan on negotiating with the tribe as they still have a compact with the state. Smith believes that the Senecas need to work out their differences with the state first.