The State of New York and Seneca Nation Continue Their $470M Dispute

New York State lawyers believe that the developments that have been presented to a federal judge by Seneca Nation of Indians leaders in the case for their gaming compact cannot override the order that requests the tribe to pay a judgment to the state worth $470 million.

Tribal officials provided William Skretny, a US District Judge, with a letter last month that was sent by Bryan Newland, the Assistant Interior Secretary for Indian Affairs, to the National Indian Gaming Commission’s (NIGC) chairman, E. Sequoyah Simermeyer. In the letter, the question of whether the Indian Gaming Regulatory Act (IGRA) would be violated by the payment was presented to the federal regulator.

Subsequent Letter Highlighted Additional Concerns

Apart from the original letter, a subsequent letter that was sent to Seneca officials by the NIGC named a few concerns by federal officials. Specifically, there is a question that, should the tribe make the payment, it would no longer hold its status as “sole proprietary interest” in its gaming operations.

According to federal law, the states can only collect fees so that they can cover regulatory costs. If they wish to receive more revenue, the law states that they need to provide more benefits.

New York officials and the Seneca Nation signed a 14-year compact back in 2002. This compact allowed the tribe to operate three casinos classified as Class III in the state’s western part. An automatic expansion of seven years was also included in the compact, but according to its framework, payments were required just for the first 14 years.

Hence, both parties disagreed on whether the payments should continue or not. After an arbitration panel, an appeals court and a federal district judge ruled in the state’s favor, the tribe still wanted a court to decide on the case. In February, the appeals court did state that the tribe owes money to the state; however, Senecas decided not to take the matter to the US Supreme Court.

In the end, when the tribe informed officials with the Department of the Interior that the payment would be made, the department responded by saying that an assessment of the seven-year expansion hasn’t been made, even though it is required under the IGRA. That led to the Senecas seeking a stay of the payment back in April.

Final Chapter Still Not Written

Since the review by NIGC is ongoing, tribal officials are asking Judge Skretny not to enforce the judgment, at least until the commission decides whether the payments are valid. New York State lawyers responded to the Seneca Nation last week by saying that, with the involvement of federal officials, the tribe is trying to circumvent its obligations.

Gregory Starner, a White & Case LLP lawyer, stated that the letter by the NIGC didn’t state or intimate that the federal department intends to intervene in the action, which means the payment is still owed. Simermeyer declined to comment at the Global Gaming Expo in Las Vegas held this week.

Media outlet The Center Square was also informed by a spokesman for Gov. Kathy Hochul that any claims of the state not providing a valuable return for the payments are false, and that the state can demonstrate has provided more value to the tribe’s operations.