Seneca Nation Drops Lawsuit Against New York State, Seeks New Gaming Compact

Seneca Nation will secure $40 million as part of the current compact
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A four-year legal dispute between the Seneca Nation and New York State over casino revenue is finally over.

Seneca President Matthew Pagels announced Wednesday night that the nation and state officials agreed to negotiate a new casino compact.

“Rather than pursue continued legal action, we believe it’s in the best interest of the Seneca Nation to address those important concerns through a negotiation of a compact that will provide clarity on our obligations and, equally as important, the obligations that New York state has to the Seneca Nation in return,” Pagels said in the Facebook announcement.

The lawsuit is now dropped and the Seneca Nation will secure $40 million as part of the current compact, which expires at the end of of 2023. Seneca Nation is now seeking a new gaming compact, and negotiations are set to begin in 60 days. The Senecas will pay the state the nearly $500 million in revenue-sharing money it has withheld since the dispute began in early 2017.

“I am pleased to have reached an agreement for the resumption of payments on terms that serve both the State and the Nation and that benefit Western New York communities, and I look forward to beginning discussions toward a new compact,” Gov. Kathy Hochul said in a statement.

Dispute details

Pagels wants Seneca Nation to have greater control over its casino operations under a new compact. Under the current deal, a state gaming commission regulates the three casinos in Buffalo, Salamanca, and Niagara Falls. Pagels notes the Nation has invested more than $1 billion in developing the casinos, which employ roughly 3,000 people.

“We’re confident she [Hochul] and her administration will work in good faith with the Seneca Nation on a compact that is fair and equitable,” Pagels added.

The Senecas signed a 14-year compact with the state in 2002, which included that 25% of slot proceeds would be shared with the state, which in turn would pass funds along to the casino host cities. The Senecas believed their obligation to make the payments expired at the end of 2016 on the basis the renewal terms were never reviewed by the U.S. Interior Department secretary. Payments to the state were halted in March 2017, prompting a legal battle. The state won an initial ruling in its favor via an arbitration panel in 2019, and federal appeals courts have backed the state since then.

Photo: Shutterstock

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