Seneca Nations Wants State Payments Decreased

This Wednesday President of the Seneca Nation of Indians Matthew Pagels stated that the corporation’s payments from video slots revenue to the state must be reduced in the next compact with the New York State. Mr. Pagels explained how the times have drastically changed and the current number is way too high as the competition in the area grows bigger with every year.

The compact in question between the tribal corporation and the state of New York was signed back in 2002 and it says that the gambling company must pay 25% of its slot machine revenue to the state. Then, a portion of this revenue is used to support Niagara Falls, Buffalo, and Salamanca, where the corporation oversees a casino property.

Unfair Assessment

In a Wednesday press conference president of the tribal company, Pagels voiced his opinion that the 25% number is way too high as the corporation now faces greater competition compared to 19 years ago when the compact was signed. He claimed that the gambling scene in Western New York has endured a drastic change and stated that the 25% revenue payment is not a fair assessment now.

According to the 2002 compact, the tribe has to pay slot machine revenue to Albany for 14 years. Additionally, the contract had a renewal clause extending the agreement for seven more years beyond 2023. However, the compact does not specify whether the tribal corporation must continue its slot payments to the state after the renewal period, thus leading to the gaming leader stopping its payments in 2017.

The dispute between the tribe and the state continues to be unresolved to this day. And during Wednesday’s press conference many considered that if Mr. Pagels insists on reducing the payments, he acknowledges that the corporation is in debt of the state. To which he responded that the tribal nation wants a payment that is fair and justifiable.

Mr. Pagels stated that the arbitration decision was made, and in order to follow the federal law, it must be decided which one it will be if there was even one. Additionally, he stated that the ruling by Interior Secretary Deb Haaland would help the tribe to negotiate for a new and improved compact with the state of New York.

Federal Stay

At the end of April this year, the tribal corporation has officially filed for a 45-day federal stay in its dispute with the NYS. The company continued to support its claim that payments should not be made to the state as it is stated in the Class III gaming compact. The compact was subject to review by the U.S. Department of the Interior.

Court’s Verdict

Rewinding even further back in February, a federal court of appeals has given its verdict on the 2002 gaming compact argument between the two sides. The court has decided that the tribe must honor its financial obligations to the state and pay its US$255 million debt of slot revenue sharing to the state. The tribe responded to the verdict by stating that the court deliberately disregarded the Indian Gaming Regulatory Act and the decision is incorrect.

Source: Prohaska, Thomas “Seneca Nation president says payments to state should be reduced”, Buffalo News, May 5, 2021