The Seneca Nation owns and operates the Seneca Niagara Resort and Casino in Niagara Falls, New York. Photo: Christine K

Compacts | New York

Seneca Nation on the hook for $256 million in gaming payments

Tuesday, November 12, 2019

It looks like the Seneca Nation will have to fork over $256 million in gaming revenues to the state of New York.

Between 2002 and 2016, the tribe shared $1.4 billion with the state. The arrangement stopped because the tribe believed it only had to make payments for 14 years.

By a 2-1 vote, a panel of arbitrators disagreed and told the tribe to pay up earlier this year. The tribe then asked a federal judge to review the matter.

The gamble did not pay off. In a November 8 ruling, Judge William Skretny determined that the arbitration panel acted within the law in reaching its conclusions in connection with the tribe's Class III gaming compact with the state.

"The Nation and State agreed to resolve disputes arising from or related to the Compact through binding arbitration," Skretny wrote in the 30-page decision. A majority of the arbitration panel assigned to the dispute definitively held in the State’s favor."

The tribe plans to review the decision before determining its next step, President Rickey Armstrong Sr. said in a statement to The Buffalo News.

"We understood the reality that the arbitration and court proceedings may not ultimately uphold the language of the Compact as written. Yet, it is our obligation to defend our agreements, so they are not compromised for the benefit of others," Armstrong said in the statement quoted by the paper. "We will take the time to review today's decision and determine how the Nation will proceed.”

The state, meanwhile, is overjoyed.

"The court confirmed what we've said all along: the Seneca Nation needs to fulfill their obligations, make their neighbors and the state whole, and pay what they owe in exchange for their exclusive gaming rights," Rich Azzopardi, a senior advisor to Gov. Andrew Cuomo (D) said in a statement. "It is our hope that they end this charade, stop using the courts to delay, and pay what they owe."

In 2002, the Bureau of Indian Affairs allowed the tribe's compact to take effect without outright approving or rejecting it. As a result, the agreement is considered to be legal but only to the extent its provisions are "consistent" with the Indian Gaming Regulatory Act, according a notice published in the Federal Register.

The tribe subsequently reached a memorandum of understanding with the state in 2013 to settle a prior gaming compact dispute that also impacted the revenue sharing arrangement. There is no record of this agreement, which includes a provision stating that the compact can be automatically renewed in 2016, being submitted to the federal government for review.

Turtle Talk has posted documents from the case, Seneca Nation of Indians v. State of New York.