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Dyster Played Smart Hand, Is Big Winner in Gaming Settlement

By Tony Farina

Mayor Paul Dyster, Seneca President Barry "Baby You're A Rich Man" Snyder and Gov. Andrew Cuomo strike a deal that allows Niagara Falls to get what it was originally promised.

These happy albeit shadowy people are locals helping to pay for the city share of the casino cash. They play in the dark and lose their money for a worthy cause. To help make Seneca rich.

For a long time, it looked like Mayor Paul Dyster of Niagara Falls was whistling in the wind when he remained hopeful that a solution to the gaming war between the state and the Seneca Nation would come in time to save his city from financial collapse as a result of lost revenue the city was banking on during the more than three-year long dispute.

Niagara Falls, which was estimated to be behind more than $60 million in casino revenue sharing payments since 2009, was by far the biggest loser of the three host cities in the region as a result of the stalemate followed by Salamanca and Buffalo, and there had been little public sign that a deal to settle the dispute was in the cards despite earlier agreements with two other tribes.

Struggling to maintain services and pay its bills, Niagara Falls had its credit rating downgraded by Wall Street and the state comptroller warned in an audit just two weeks ago that the city was in danger of running out of cash later this year, mostly as a result of the lost casino money, but also criticizing the city for including the non-existent casino revenue in its budgets and for spending down its fund balance in the face of the dispute.

Dyster held firm against the negative tide, maintaining against the seemingly long odds that somehow an agreement was within reach and telling this reporter last month that he felt the window of opportunity for a settlement was at hand despite the heated rhetoric that was going back and forth publicly between the governor and the Senecas as the end of the legislative session drew near, the deadline Gov. Andrew Cuomo had set on negotiating a deal.

It now appears that with the agreement that was announced last week that will deliver $408 million in past casino revenue sharing to the state-- including $140 million to the local host casino cities with $89 million of that going to Niagara Falls-- that Dyster had it right and played the hand he was dealt perfectly.

The mayor’s patient public posture and his unwavering support of Cuomo  now has delivered him a major political victory against his critics who felt that he wasn’t doing enough to protect the city’s interests in the bitter and long-running dispute.

“Gov. Cuomo gave me great access [to the negotiations] as he got personally involved,” Dyster told this reporter in an interview, “and I became more and more certain [that an agreement would get done].  And he had promised me during our talks that no matter what, he would take care of the city.  I told him I never doubted him for a minute.”

Dyster said he feels “vindicated” by the outcome that he made the right political judgment in backing Cuomo and now the city is in a position to move forward, building on the strong relationships he believes are in place with the state and the Senecas.

“It’s a huge victory,” Dyster said, “and we’re getting our just due.  We still face very large challenges like most upstate cities with lots of vacant buildings and population loss, but we’ve also done a lot despite the recession.”

Dyster said he was in regular communication with members of the governor’s inner circle during the negotiations, mentioning Howard Glaser, the state’s director of operations and a key Cuomo adviser, and Robert Williams, director of the state gaming commission.

The mayor said he had learned a lot about Indian sovereignty during his undergraduate days at UB in the mid-70’s from Oren Lyons who was teaching at the university during that time.  Lyons is a Native American Faithkeeper of the Turtle Clan of the Seneca Nations of the Iroquois Confederacy and a recognized advocate of indigenous rights.

“I had been interested in Indian history and culture,” said Dyster, saying he understood the need for the two leaders---Gov. Cuomo and Seneca President Barry Snyder—to meet face-to-face in order break the deadlock.

“I made the point in my discussions with members of the governor’s team of the symbolic importance of the leaders meeting face to face, to personalize the talks,” said Dyster.  “I remember as a young man watching former Niagara Falls Mayor E. Dent Lackey (1963-75) give deference to the Tuscarora Indian chiefs during public events,” adding he learned how important the respect factor is in dealing with a sovereign nation and its leaders.

Cuomo and Snyder did meet face to face in New York last month and that gave the two leaders a chance to size each other up and look for possible ways to break the stalemate face to face.  It worked, as we now know.

Dyster said despite Cuomo’s tough talk and threats of putting a non-Indian casino in the Western New York exclusivity zone unless an agreement could be reached, it was just a part of the process that is sometimes necessary to leverage the support of your own troops.  In his mind, Dyster believed the window of opportunity was at hand and both the state and the Senecas recognized that concessions would have to come from both sides.  And they did, in the final agreement.

“Everybody has given something up,” said Dyster, “and the governor realized it was important for him to say the state had done some things it shouldn’t have done and he did just that.

Cuomo publicly stated after the agreement was announced that “the Senecas had a legitimate dispute.  The president of the Senecas fights very hard for the people he represents.  I fight very hard for the people I represent.”

Under the memorandum of understanding, which still must be formally approved by the Seneca Tribal Council, Niagara Falls, Buffalo and the Salamanca region will receive a total of $140 million, $89 million for Niagara Falls, $15.5 million for Buffalo, and $34.5 million for the Salamanca area.

The Senecas get to keep $209 million of the $617 million casino revenue sharing pot that had been placed in escrow pending a settlement of the Seneca claims that the exclusivity zone had been violated with the state’s three race track “racinos” which, under the new agreement, can no longer be referred to as casinos.

The Senecas will also resume paying 25 percent of casino slot machine revenues to the state, about $135 million a year.

Cuomo had earlier negotiated agreements with two other tribes on gambling issues, the Mohawks and Oneidas, giving them exclusive gaming rights in their regions.

Cuomo’s bill to expand gambling in the state now includes a provision added over the weekend that would offer high-end video slot machines in New York City and upstate in case the casino referendum fails.   Cuomo has been pushing to expand gaming with possibly as many as four Vegas-type casinos upstate.  The expansion needs a second approval by the legislative to be placed on the ballot this year.

As for Niagara Falls, Dyster said Cuomo told him he would try to expedite the delivery of the past due revenue sharing funds within a few weeks.

“We are good right now,” said Dyster.  “We had been able to push back the cash flow issue until the fall, so now we will be current.”  The city will use about $22 million of the casino money to repay the general fund, and entities like the NFTA, the NTCC, the Medical Center, the school district and the Underground Railroad museum are rightfully entitled to their share of the revenue sharing pot.

For Salamanca, casino money is badly needed, as the city has had to borrow $7.5 million from the state to stay above water.  Buffalo did not budget for the casino funds this coming year but instead will use $29 million over the next three years to cover expenses in the general fund that otherwise might have been paid with money in the city’s fund balance.  So it is very important to Buffalo going forward, reducing the strain on its reserves.

It was a very difficult time for all the parties in the gaming dispute and there’s no question that getting a negotiated agreement even while the arbitration process was going on was the best possible option, as Dyster had said many times.

For the mayor of Niagara Falls, who has been battling with nervous city lawmakers for some time over the ongoing crisis, it was a victory that validated his confidence in the governor’s ability to get an agreement and protect the city if his efforts failed.  Dyster deserves credit for not rocking the boat during the long and difficult process and helping to promote the settlement with his behind-the-scenes work with the Cuomo camp.

Another big winner is, of course, Andrew Cuomo, who has managed to negotiate a deal that while not popular with everyone, including some inside the Seneca camp, is clearly a positive for the local region as it restores confidence that despite the no-tax advantage enjoyed by the Senecas, the local communities will receive their slot machine revenue under the 2002 gaming compact that now extends to 2023.

As for the Senecas, President Snyder confirmed in his post-news conference comments that his meeting face-to-face with Cuomo was indeed very important. “This is nation-to-state,” he said of the protocol of how an Indian leader is to be treated.

“In the end, nobody got 100 percent of what they wanted, but it was very good for both sides,” Snyder told the Buffalo News.

In Niagara Falls, longtime council member Bob Anderson cautioned that there is still much work to be done, even with the arrival of the casino money.

“We still face many long-term challenges,” Anderson said, and members of the council will be on guard to make sure the casino funds are used in the best interests of the taxpayers going forward.

Council Chairman Glenn Choolokian said lawmakers will continue to employ a conservative approach when it comes to spending tax dollars in hopes of preventing a repeat of the casino crisis.

The Dyster administration and City Controller Maria Brown now have the monumental task of reconciling all the city accounts and determining how the money from the settlement will be disbursed to get the city back on solid ground.




Niagara Falls Reporter - Publisher Frank Parlato Jr. www.niagarafallsreporter.com

JUN 18, 2013