The Seneca Nation of Indians has been ordered to pay New York state $225.8 million in back casino revenue-sharing payments it has withheld over the past three years.
However, neither the state nor the municipalities in Cattaraugus County that receive a share of those casino payments to the state are counting the money just yet.
The city of Salamanca receives about $6 million a year in casino payments as its share of revenues from the Seneca Allegany Casino. In 2016, the last year Cattaraugus County received a full four-quarter payment, it was about $1.1 million.
City and county officials have not heard when those payments might resume. Since it is beyond their control, they seem resolved to let the arbitration process play out.
Asked for a comment on Wednesday’s ruling by a three-person arbitration panel, Seneca Nation President Rickey Armstrong Sr. replied via email, “We received the panel’s ruling late yesterday (Wednesday) afternoon and are taking the time to review it.”
The Seneca Nation stopped making the state revenue sharing payments — 25 percent of the slot machine profits — in the first quarter of 2017, after both sides automatically renewed the gaming compact for a third seven-year period. Seneca officials said there was nothing in the compact that stated the revenue sharing would continue after the 14th year.
The arbitration panel consisted of one member nominated by the Seneca Nation, one by New York state and a third who was agreed upon by both sides. Two of the three members ruled in January the revenue sharing must continue under the compact. The member appointed by the Senecas disagreed. The revenue sharing was to give the Senecas exclusive gaming rights in Western New York.
The Seneca Nation previously withheld revenue-sharing funds after the state expanded gaming at Upstate race tracks, including three in Western New York. The state and Senecas eventually agreed to a partial repayment of the withheld revenue sharing funds.
The language of the compact would permit the state to go into federal court if the Senecas do not abide by the arbitration decision. The Senecas acknowledged the 2-1 decision in January but stopped short of saying it would pay the state immediately when a decision was announced.
Salamanca Mayor Michael Smith said he has heard nothing about what to expect since the arbitration decision was announced three months ago.
“It’s between the state and the Nation,” Smith said.
Based on what the city received from the casino revenue sharing in the past, the mayor said the two-year period would net the city about $12 million.
The Senecas had placed the funds in escrow during the arbitration process. The first-quarter payment for 2019 will be due to the state soon.
Cattaraugus County Administrator Jack Searles said he briefed legislative leadership on the casino revenue sharing on Wednesday and updated them Thursday when news of the arbitration panel issued its order on the value of the revenue sharing payments due to the state.
“We haven’t been able to get a potential dollar amount yet,” Searles said.
He noted the county has not budgeted the casino revenue sharing for the past two county budgets.
The last full year of payments amounted to about $1.1 million for the county, just enough to cover the county’s property tax losses in the city of Salamanca. When a member of the Seneca Nation buys property in Salamanca on the Allegany Territory, it comes off the tax rolls.
The county has also received funding for direct costs associated with the casino and economic development efforts, although that has declined in recent years.
The Salamanca Central School District also receives a share of the local casino revenue sharing, enough to make up for any property tax losses.
(Contact reporter Rick Miller at firstname.lastname@example.org. Follow him on Twitter, @RMillerOTH)