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Casino decision cuts into Seneca Nation’s market, dashes Southern Tier’s hopes

The Seneca Nation of Indians’ gambling facilities lost about $40 million in annual revenue the other day, and other upstate venues lost millions, too, while some people in the Southern Tier lost something more valuable than money: They lost hope.

It all happened because on the same day the state banned fracking – sought by landowners in the economically struggling counties along the Pennsylvania border – it granted a license for a new casino not in the Southern Tier, but in Seneca County.

The state will allow a new casino just off the Thruway between Rochester and Syracuse, and within an easy drive of the Senecas’ two Buffalo-area casinos. Batavia Downs Gaming, a “racino” in Ontario County and the Oneida Indian Nation’s Turning Stone casino in Oneida County are not far from the new casino site, either.

The Senecas declined to comment on the state Gaming Commission’s move, which came as it also gave the go-ahead to new casinos in Schenectady and Sullivan County.

But the Senecas’ point of view was spelled out in a September letter to the gambling commission, which quoted the developer of the proposed Seneca County casino as acknowledging that $133 million of its annual revenue – or more than half – would come from other casinos, with $40 million coming from the Senecas.

“These recent statements confirmed the developer’s clear intent to cannibalize the market share of other established gaming properties in the upstate region, with the impacts felt most acutely in the area between Buffalo and Syracuse,” wrote Barry E. Snyder Sr., then the Senecas’ president.

The impact would be felt, too, in the Southern Tier, where local officials were counting on either fracking or a casino to lift a region that’s been beaten down by cutbacks by major employers such as IBM.

After the commission announced its decision Wednesday, State Sen. Tom Libous, R-Binghamton, told reporters that Seneca County should not have been awarded a casino that had been promised to the Southern Tier.

“You’ve heard of the Buffalo Billion? Well, I want the Southern Tier Billion. If Buffalo can get a billion dollars, then we should get a billion dollars here in the Southern Tier for economic development and bringing in new business and companies,” he said on WIVT, a Binghamton television station.

Instead, the tiny Seneca County town of Tyre, population 981, got $424 million.

That’s how much Rochester Developer Thomas Wilmot plans to spend on his Lago Resort & Casino in the Finger Lakes. Construction is expected to begin immediately, so by the end of next year, Tyre will be home to twice as many slot machines as people.

Sources familiar with the gambling commission’s decision said the Lago proposal would be a far bigger revenue-producer than either of the two casinos that had been proposed for the Southern Tier: the $212 million Traditions Resort and Casino in Johnson City, Broome County, and the $187 million Tioga Downs Casino in Tioga County.

Kevin Law, the commission’s chairman, told reporters that the Lago proposal was the best put forth in the region.

“First, we felt Lago had the best overall financial capabilities to succeed,” Law said. “And it really wasn’t a choice between Lago and the other two in the Southern Tier. It was more of a choice between Lago and nothing in the region, based on the finances.”

It’s certain, though, that the decision won’t sit well with the Senecas or the other gambling operators straddling upstate.

“The proposed Lago project does not seek to complement surrounding established economic factors, but rather aims to draw people away from economic centers like Buffalo, Rochester and Syracuse and create a stand-alone silo,” Snyder wrote to the commission.

The proposal would “place our continued ability to provide the substantial economic benefits we have generated since opening our doors … in jeopardy,” Snyder added.

And that’s not all.

Developers of the Lago casino told the state that in addition to grabbing $40 million of the Senecas $800 million in gambling revenues, their facility would cost Finger Lakes Gaming & Racetrack in Ontario County about $20 million. David Brown, president of the track’s Horsemen’s Benevolent and Protective Association, told Blood-Horse, a racing blog, that the move could put the racetrack – which is only 25 miles from Tyre – out of business within two or three years.

Meanwhile, Genesee County legislators were so concerned about Lago’s impact on Batavia Downs Gaming that they passed a resolution opposing the proposed casino earlier this year. The Lago resort will be about 78 miles east of Batavia Downs.

That’s about the same distance between Tyre and Verona, the home of the Oneida Nation’s Turning Stone casino. In the wake of the decision, the Oneidas released a statement that could be seen as a mildly passive-aggressive jab at a wealthy Rochester developer treading near the tribe’s turf.

“Turning Stone has operated since 1993 as if we had competition, and we’ve been preparing for it since then,” the statement said. “We reinvest 100 percent of our revenues into our own community, and we will continue to do so.”

The tribes may not want to complain publicly, though, because they agreed to let a casino be built in Tyre.

Both the Senecas and the Oneidas agreed to allow further casino development so long as it didn’t infringe on a zone of exclusivity surrounding their existing facilities. The Senecas have exclusive gambling rights west of Route 14, a north-south road roughly halfway between Syracuse and Rochester. And the Oneidas have exclusive gambling rights in 10 counties surrounding Turning Stone.

The Tyre casino site is just beyond the limits of both zones of exclusivity. Arthur “Jerry” Kremer, a former Democratic assemblyman who closely followed the gambling commission’s site-selection process, said the Indian tribes have no right to complain.

In any case, the griping so far about the Tyre casino site has been loudest in the Southern Tier.

“Both the fracking and this, what does (Gov. Andrew M. Cuomo) expect these people to do?” asked Jeff Gural, owner of Tioga Downs and one of the losers in the casino site-selection process, according to the Binghamton Press & Sun Bulletin. “He had an opportunity to create jobs. He had two chances to create jobs, and he decides not to give them any jobs.”

Libous, the state senator from Binghamton, agreed.

“The executive branch dealt us two major setbacks today,” he said on his website Wednesday. Asking that the state reconsider the Southern Tier casino sites, he noted: “The chosen Tyre site is closer to Canada than it is to Binghamton.”

Rep. Tom Reed, R-Corning, was equally aghast.

“This is a real one-two punch to the Southern Tier,” Reed said of the decisions. “It appears that we’re getting the cold shoulder, that we’re irrelevant.”

Kremer noted, though, that Cuomo still could help the Southern Tier with a possible Buffalo Billion-like development package in his upcoming state budget. Also, the gambling commission still has the authority to grant one more casino, which could go to the Southern Tier.

Such reassurances don’t seem to mean much, though, to Reed, who represents most of the Southern Tier and who said his constituents are livid about the state’s decisions.

“This concerns the people I care about most: my friends, my family, my constituents,” Reed said. “It just seems there’s a lack of caring here.”

email: jzremski@buffnews.com