Seneca Nation’s New York Gaming Compact Extended Amid Renewal Negotiations

Article ByDavid Weir

December 5, 2023

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Posted in: New York Gambling News, US Casino News, US Gambling News

New York Governor Kathy Hochul (pictured) and the Seneca Nation of Indians have negotiated a short term extension on the Seneca’s gaming compact with the state, which was set to expire on December 9, 2023.

This extension, now running through March 31, 2024, allows the Senecas and their employees to continue working at their three New York casinos while negotiations towards a more permanent, long-term agreement continue.

The pact ensures the continued operation of the Seneca Nation’s three major casino resorts during discussions: Seneca Niagara Resort & Casino, Seneca Allegany Resort & Casino, and Seneca Buffalo Creek Casino​​​​.

The additional time also aligns with the New York State Legislature’s schedule to present a budget to Gov. Hochul for the 2025 fiscal year, offering a window for comprehensive discussions and alignment of interests​​​​.

New York Senate Minority Leader Rob Ortt told local media that he sees this extension as a sign the parties are now close to agreement after six months of negotiations.

“The terms of the compact are unchanged from before, and both sides will be meeting again in the coming weeks to continue negotiations on a long-term compact,” Hochul’s office said in a statement.

Hochul Back at the Table

This news comes just days before the expiration of the existing contract would have put 3,000 casino workers jobs at risk. The delays to discussions are the result of several complex factors. But Governor Hochul previously being excused from negotiations did not help.

The Governor’s husband, William Hochul, was previously on the board of Delaware North, a company that operates Finger Lakes Gaming & Racetrack, which is in direct competition with the Seneca’s casinos in Western New York.

That meant a potential conflict of interest, which forced the Governor out of discussions on the compact. However, in her absence, things did not go well. A surprise agreement announced in June was swiftly canned after it was revealed that the deal set out a potential casino for the Seneca in Rochester, New York. Those plans were not popular with local politicians and residents, leading to cancellation of the proposed agreement.

Now, Bill Hochul has left Delaware North, and the Seneca and the state of New York have another few months to agree on a new compact.

“I have to come to the conclusion that that means that they think that they’re at least close to a deal, or the negotiations are progressing. Because in my experience, if they’re not, then those extensions are harder to hammer out,” minority leader Ortt said.

Navigating Negotiations

The Indian Gaming Regulatory Act (IGRA) stipulates that federally recognized tribes can operate Class I and II games like bingo on their sovereign lands without state interference. However, to offer slots and house-banked table games, a Class III gaming compact with the host state government is mandatory​​.

The Seneca Nation, under the current compact, enjoys exclusive rights to operate slot machines and dealer table games in the region west of State Route 14. In return, New York receives 25% of the tribe’s gross gaming revenue from slot machines, amounting to approximately $100 million annually.

Ortt, representing Niagara Falls, where the largest of the three Seneca casinos is located, also emphasized the importance of these negotiations.

“We’ll need time, though, to digest the deal, so this hopefully will not be (done on) a last day of session or 2 in the morning on April 1 as the budget needs to be done, and ‘Oh, by the way, here’s this compact.’ It’s too important to Western New York, and I would argue, it’s too important to New York state,” he said.

Resetting the Relationship

The last breakdown in negotiations between the Seneca and the state of New York resulted in Governor Hochul inheriting a $500 million payment dispute when she took over from Andrew Cuomo in 2021.

The Senecas claimed the existing contract, now extended, had expired in 2017, and thus they didn’t need to pay up on five years of agreed fees. Hochul came in playing hardball and froze the Seneca’s banking assets in the state of New York until they paid up.

However, that left the relationship between the two groups frosty leading up to 2023’s negotiations. Now that some headway seems to have been made, things seem more hopeful for a deal before the old contract expires.

“In our discussions, Gov. Hochul has expressed a desire to reset the relationship between our governments. No issue is of greater importance to the economies of Western New York and the Seneca Nation than a fair compact,” said Seneca Nation of Indians President Rickey L. Armstrong Sr.

“Tens of thousands of individuals, families, and businesses across Western New York are depending on an agreement that secures the significant jobs, business opportunities, and economic benefits the Seneca Nation delivers to the Western New York economy. The short-term extension of our compact is an important step. But even more important work remains to be done.”