Cuomo must deal fairly with the Seneca Nation for Niagara Falls to thrive

After signing an extension of the Seneca Nation's gaming compact in 2012, Andrew Cuomo is now refusing to live up to the plain language in that compact.

Everyone in the business community agrees: Governor Andrew Cuomo must begin to deal fairly with the Seneca Nation of Indians in order for Niagara Falls to thrive as a global destination. For too long, his hostile posture has destroyed countless opportunities for collaboration with local governments and business leaders to develop Niagara Falls into (at least) what’s been developed on the Canadian side of the border.

It sounds simple, but fairness has not been characteristic of Cuomo’s unpredictable dealings with the Seneca Nation. The hostilities began during Cuomo’s first year when executives at Delaware North lobbied Cuomo to ignore the fact that the Seneca Nation had purchased the exclusive right to operate slot machines west of State Route 14 in a 2002 gaming compact with Governor George Pataki.

Cuomo’s authorization of Delaware North’s casinos at Farmington and Hamburg effectively defrauded the Seneca Nation of that multi-billion dollar asset.

States don’t have the constitutional power to tax Tribes, which is exclusively an area of federal jurisdiction.  So for New York to profit on Indian gaming, the compact had to sell a legitimate asset to the Tribe that was measurable and quantifiable.  In exchange for the right to exclusively operate slot machines in Western New York, the Nation agreed to pay New York State 25% of top-line slot machine revenues.

Early in Cuomo’s first term, Delaware North had bankrolled the Committee to Save New York, which blanketed the State with commercials endorsing Cuomo.  Shortly thereafter, Cuomo authorized slot machines at Delaware North’s horseracing tracks at Hamburg and Farmington, and at the State’s own Off Track Betting organization at Batavia Downs.

At the time Delaware North had been lobbying a slew of public officials, hired media operatives, and conspired with top executives to thieve the Seneca Nation’s gaming asset.

Shortly after political contributions exchanged hands, the Cuomo administration was persuaded to authorize Delaware North’s use of slot machines – so long as they called them ‘Video Lottery Terminals’ and refer to their casinos as ‘gaming venues’ rather than casinos (i.e., ‘Finger Lakes Gaming & Racetrack’, and ‘Hamburg Gaming’).  That distinction is arbitrary and capricious.

The ensuing controversy cost the City of Niagara Falls what would have otherwise been a decade of collaboration, growth, and expansion.  But instead, by cannibalizing the Seneca Gaming Corporation’s market share – after it invested more than $1 billion in high-quality venues across the region – Delaware North destroyed the Tribe’s relationship with the State, exacerbating profound distrusts.

Critics say the the Governor was bribed in way that allowed Delaware North to open two casinos, siphon hundreds of millions from their chief competitor, and neutralize their chief competitor’s capacity to collaborate with the State – all while generating untold sums of propaganda that smear the Seneca Nation as somehow being a dishonorable partner.

Delaware North is one of the Nation’s largest privately owned firms, with large-scale concessions, gaming, and tourism operations operating around the world.  The firm is owned by the Jacobs family, and it’s chairman – Jeremy Jacobs, Sr. – is estimated by Forbes to have a net worth of more than $5.4 billion.

The political scion of that family and the nephew of Jeremy is Christopher Jacobs, who was elected to the New York State Senate in 2016. Even in his first term, Jacobs delivered big for the family business.  He was able to secure the passage of a bill that would allow Delaware North’s racetrack casinos to keep gaming revenue that they would have otherwise owed to the State for the purpose of expanding those venues.  In effect, New York State taxpayers are funding the expansion of their casino properties.

Imagine how much progress could have been made in downtown Niagara Falls if Governor Cuomo was willing to offer the Seneca Nation the same deal that he so readily offered to the Jacobs family: keep the State’s (alleged) share of the slot machine revenue, but use it to expand the venue.

We would all benefit from economic growth.

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