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Falls, Salamanca, Buffalo await long-overdue flow of casino cash

After more than three years of waiting, the Western New York communities that host the Seneca Nation of Indians’ three casinos will get the money they’ve been owed.

Niagara Falls, the Salamanca area and the City of Buffalo will receive a total of $140 million that had been held up because of a dispute between the Seneca Nation and the state.

Under a deal announced Thursday by Gov. Andrew M. Cuomo and Seneca Nation President Barry E. Snyder, Niagara Falls will get $89 million, while Salamanca and Cattaraugus County will get $34.5 million and Buffalo gets $15.5 million.

“This is one of the great, happiest days of my life, and I’m sure for all the people in the City of Niagara Falls,” Mayor Paul A. Dyster said during a news conference in the Conference Center Niagara Falls announcing the agreement.

Though Buffalo had not included casino revenue in its most recent budgets, the impact of the casino cash standoff weighed heavily on the Falls, where the cash crunch led to budget cuts and the possibility of the city running out of money by the end of the year.

Having not received a payment for its share of slot machine revenue since the spring of 2010, the city has seen Moody’s credit agency downgrade its credit rating twice between January and May.

Among the spending cuts, Falls officials had planned to repave fewer streets this year because of the financial squeeze.

Under previously existing terms, a number of entities were to be allocated part of Niagara Falls’ share of the slot machine revenue from Seneca Niagara Casino.

The city school district, Niagara Falls Memorial Medical Center, the Niagara Tourism and Convention Corp., the Niagara Frontier Transportation Authority and a planned Underground Railroad museum each are entitled to some of the casino revenue.

The school district and the hospital had been receiving $750,000 per year, while the tourism agency got 7 percent of the city’s 25 percent share.

In previous years, the NFTA’s portion has been used for Niagara Falls International Airport.

Niagara Falls School Superintendent Cynthia A. Bianco said the casino funding will mean the district’s reserves are no longer completely depleted.

In addition to education, some of the money will flow to help area tourism.

“Niagara Tourism and Convention Corporation applauds Governor Cuomo and Seneca President Barry Snyder for this unified action which will ultimately benefit the host communities,” agency President and CEO John Percy said in a statement. “As a designated recipient of the casino revenues, we look forward to expansion of our marketing programs to further increase exposure of Niagara USA as a premier tourism destination.”

Over the course of the dispute, Dyster believed the city was owed at least $60 million.

The city had been able to track how much it believed it was owed because of filings the Senecas had to submit to the federal Securities and Exchange Commission, submissions they were no longer required to make after they refinanced some debt, Dyster said.

The City of Salamanca was also hit hard because of the dispute.

Mayor Carmen Vecchiarella said his city has been “running on fumes” since the casino payments dried up.

The city has had to borrow $7.5 million from the state to help cover its expenses, $2.5 million of which just arrived two days ago, Vecchiarella said.

The city shares slot machine revenue from Seneca Allegany Casino with Cattaraugus County in a 75-25 split after some costs are covered, the mayor said.

Vecchiarella, who called the deal “great news for us,” said the city does not have any definitive plans for the funding, and that he is waiting for more details about the figures.

Unlike Niagara Falls and Salamanca, Buffalo has not anticipated casino revenue to balance its recent budgets. However, a four-year plan the Brown administration released in May showed the city was counting on $29 million to use in future budgets.

“This agreement between Gov. Cuomo and the Seneca Nation is extremely good news for the City of Buffalo and the other municipalities that were impacted by it,” said Mayor Byron W. Brown.

The city did not anticipate any revenue from the Seneca Buffalo Creek Casino to balance the budget that begins July 1, but expects it will use $15 million in slot machine revenue in 2014-15, $9 million in 2015-16, and $5 million in 2016-17.

“It turned out to be a calculated risk that the mayor took, and it was successful,” said Comptroller Mark J.F. Schroeder.

Depending on when the slot machine revenue arrives, the city will use it to pay general fund expenses that would have been paid with leftover surplus funds, known as fund balance. The city’s continued use of fund balance has been a concern of credit rating agencies.

As long as the casino revenue continues to flow, the city will still have enough to use in future years, as planned, Brown said.

Buffalo last received a payment of casino revenues in 2009-10, when it received $2.6 million, which represented two years of revenue.

Since then, the city’s yearly share of revenue has grown to about $5 million.

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