Area municipalities looking forward to casino payments restarting

Niagara Falls Mayor Paul Dyster said he is looking forward to an influx of some $30 million after a state arbitration panel decided casino revenue sharing should continue.

In a statement, Seneca Nation President Rickey Armstrong remained unclear whether casino payments will continue, despite the decision.

Credit Seneca Allegany Casino Resort and Casino

"Despite the panel finding that the Compact, as written, simply does not address the topic of revneu share beyond Year 14, a majority of the panel members determined that an obligation exists to continue revenue payments to the State," Armstrong said. "We continue to believe, as anyone who has read the Compact, that the Nation's Compact obligation was fulfilled, and we believe we had an obligation to the Seneca people to defend the Compact as it was written and agreed upon."

Even so, Armstrong said, the nation prepared for arbitration's decision - for or against the Nation. He said the decision is being reviewed as to how to respond "and move forward."

Dyster said he is taking that last notion - "and move forward" - to mean payments will continue. Since the Seneca Nation began its gaming operations in 2002, it has sent more than $1 billion in revenue share contributions to Albany, which has shared it with casino municipalities, like Niagara Falls.

"The next step, I believe, is for the state and the Nation to come together and to compare their figures as to the exact dollar amount that is owed," Dyster said. "The formula is the same formula that existed before. That's basically what the arbitration determined, but they have to agree on the exact dollar amount."

Dyster said payments due are for all of 2017, "which includes the final quarter of 2016, plus the first three quarters of 2018, with the final quarter of 2018 not due until the end of March, I believe."

He said the payments have been "trending slightly downward" the last several years, as the casino market has become more competitive, but the last annual payment was over $16 million. So he is expecting twice that in delayed payments.

"So you've got the better part of two years of payments with roughly $16 million the last dollar amount that was paid, so in the vicinity of $30 million, give or take, and we will know that over the course of the next week or two."

Prior to Dyster issuing his 2019 budget proposal, the state stepped in to front the city of Niagara Falls $12.3 million it said was owed in casino payments. Had the arbitration decision favored the Senecas, New York State would have filled at least that $12.3 million gap in the Falls city budget.

Credit City of Salamanca

While $6 million is only half that, in the Southern Tier city of Salamanca, it is 60 percent of a $10 million city budget. Just under a quarter of the property in Salamanca is taxable,  and the city has had $10 million budgets cut to $9 million when a fight between the Seneca Nation and Albany cut off the flow of revenues from nation casinos.

Another of those casinos is in Salamanca. Mayor Mike Smith said city leaders had long built up reserves for the possibility casino revenues would stop flowing again, but casino cash is a large part of the budget.

"Oh, yes it is and that's why we had put money away," Smith said. "When I came into office - and this is my second two-year term now - when I came into office, we were sitting on a pretty good stack of change and we still have right around $10 million undesignated that, like I said, we have for an emergency."

Smith said if the cash starts flowing again, the city would probably fill some of the positions it has left vacant since the fight with Albany cut off casino revenues, but it will keep that reserve.

"Our budget process this year will be unaffected," he said. "Maybe we can hire and fill some of the city departments that have been running short-handed for the last two-plus years, but as far as that, no we're not making any 'jackpot, let's spend the money.' No, we're not doing that."

Smith said he is looking forward to the state resuming their payments.

"We had held all along that the Seneca Nation did not and does not owe the city, any of the cities, any money. The Nation pays the state. The state pays the cities. So it's always been an issue, waiting for the state to make their payments."