Anderson is in talks with Cuomo to land a gaming compact for the Tuscarora Nation

53edaab08b1b3.image-1 — Joe Anderson recently sold a dozen properties in downtown Niagara Falls to Empire State Development.

Tuscarora businessman Joe Anderson is rumored to be in talks with Governor Andrew Cuomo to land a gaming compact between New York State and the Tuscarora Nation of Indians.

A source who is familiar with Anderson’s thinking tells The Chronicle that Anderson and other Native American businessmen — rumored to include Ken Hill, Curt Styres, and Jerry Monture — would lend the Tuscarora Nation more than $200 million in investment capital to construct the venue, at lucrative interest rates.

The Tuscarora Nation would wholly own and operate that gaming venue as an instrumentality of the Tribal government, with profits intended to fund Tribal infrastructure on the Tuscarora Reservation located just outside of the city. That reservation continues to struggle to provide access to clean water infrastructure to residences.

Because New York State has no meaningful gaming exclusivity rights to sell to the Tuscarora, its ability to derive revenue cash flows for the State is limited — because States do not have the constitutional power to tax Tribes. As such, deal makers imagine a ‘structured sale’ of land that is currently owned by Empire State Development and the City of Niagara Falls.

The site that negotiators have in mind for the new casino is Anderson’s former ‘Snowpark’, a one-block stretch of the 2nd Street right of way, and several vacant parcels lining the east side of 2nd Street. That parcel has prime street frontage along Niagara, Main, and 1st Streets. Urban planners think that the location would be a boon to the 3rd Street business district.

Because Empire State Development owns a portion of that site, and the City of Niagara Falls owns a portion (the 2nd Street right of way and the vacant lots lining it), negotiators believe that a structured sale of the land to the Tuscarora Nation could benefit the City’s coffers.

Much of the Tuscarora Nation’s Reservation was confiscated by the federal government in the 1950s when the Robert Moses Power Plant was hurriedly constructed following the collapse of the Schoellkopf Power Plant. The Nation never received meaningful compensation for that land, and it was largely excluded from negotiations related to the Niagara Power Project’s federal relicensing in 2007. Our freshman Congressman at the time, Brian Higgins, was silent on the issue.

The Tuscarora Nation, they postulate, could be willing to purchase those City-owned parcels for $10 million — but it’s expected that Empire State Development would sell the largest of the parcels for the price that the State recently paid Anderson to acquire it.

Those participating in the talks deny that the Governor is using the discussions as part of a broader effort to extort the Seneca Nation of exclusivity payments that ended in 2014, as per the terms of a compact extension that he signed.

If a compact with the State can not be agreed to, the Tuscarora Nation would still be able to operate Class II gaming venues, whether on the Reservation or on parcels of land that are moved into federal trust. That would prevent roulette and craps tables from being located in the venue, but would still allow for slot machines, poker tables, games of skill, and indigenous games of chance.

Governor Andrew Cuomo is trying to figure out a way that the State could profit from new Indian gaming compacts, but States don’t have constitutional powers to tax Tribes, and the State has no meaningful gaming exclusivity remaining to sell.

Anderson is widely seen as the next in an unspoken line of succession to become Chief of the Tuscarora Nation. In the past, he has said that a top priority in that role would be to ‘reopen’ federal relicensing negotiations with the Niagara Power Project. That powerplant (whose pumped storage reservoir sits on Tuscarora land) profits to the tune of several hundred million dollars each year.

Anderson believes that the Tuscarora Nation should be receiving a substantial dividend from those operations, perhaps ranging between $40 and $50 million dollars annually.