Casino quest gets help

Seneca tribe enlists aid from Michigan group toward a large-scale Catskills project

http://www.timesunion.com/AspStories/story.asp?storyID=756185&category=REGION

By JAMES M. ODATO, Capitol bureau

First published in print: Saturday, January 3, 2009

ALBANY � A Michigan group called Rotate Black Gaming Inc. is working on a project with the Seneca Indian Nation to build a casino and resort in the Catskills that could produce $160 million annually in new gambling funds for the state to use on public education, officials said.

The relationship was suggested in a Dec. 26 filing by Rotate Black to federal securities regulators, but Seneca President Barry E. Snyder Sr. confirmed the project to the Times Union on Friday.

He revealed his government has had the exclusive agreement for the last 18 months with Rotate Black to develop and manage what would be the Catskills' first Las Vegas-style casino. It would be located near Monticello, 80 miles north of New York City, a market many casino firms and tribal partners have sought to build in for more than a decade.

Snyder said gaming revenues provided to the state from the Catskills resort would exceed the annual total of what is paid to state and local governments by the Seneca's three casinos in western New York combined.

"The Nation views development of a Catskills casino with the state as yet another example of win-win economic development," Snyder said. He said tribal gaming halls already mean more than 4,000 jobs and $300 million in direct payments to the state.

Last week, Rotate Black's filing with the Securities and Exchange Commission laid out its plan to develop 63 acres in the Sullivan County town of Thompson.

Company Chairman and CEO John Paulsen declined to say why the tribe could succeed in building in the Catskills when other Native American entrepreneurs have failed, but suggested the Seneca Nation's experience is unique.

Under a 1990 agreement known as the Salamanca settlement, the Nation has already opened casinos in Niagara Falls, Salamanca and Buffalo. While other tribes have unsuccessfully sought approval from the federal government for the right to build an off-reservation casino, the Senecas have used the Salamanca land claim settlement as the legal basis for opening casinos in their ancestral territory, but not necessarily on reservation land.

Rotate Black is acquiring the 63 acres off Route 17's exit 107, for a casino and hotel, enclosed pool, restaurants , food court and spa.

The plan is so advanced the development has been designed by Friedmutter & Associates and a builder, Perini Construction, has been retained.

Paulsen said Rotate Black doesn't need state legislation for the project, although key lobbyists with three different firms have been retained in Albany, including James Featherstonhaugh, John Cordo and Giorgio DeRosa.

The group Citizens for a Better Buffalo, represented by Albany lawyer Cornelius J. Murray, has sued over the Buffalo expansion and has won a favorable ruling in federal court, saying the Salamanca land lease settlement never gave the tribe the right to use settlement proceeds to buy land in Buffalo for a casino.

Murray has argued that the settlement agreement never provided for using settlement funds for off-reservation casino construction, and the Catskills are hundreds of miles away from the aboriginal territory of the nation.

Snyder said Rotate Black will transfer the land to the Seneca government, which will hold it in "fee status" and pay taxes on it until the U.S. government puts the land in "restricted fee" or trust status, making it tax-free Native territory. The Nation is not using Seneca Settlement Act funds to acquire the property, he said.

The deal hinges on a change in U.S. policy by the Obama administration regarding gaming on newly acquired territories.

The tribe's western New York facilities opened as part of the 2001 state law that allowed the Senecas to build up to three casinos in their ancestral region, and up to three more in the Catskills by unspecified tribes. But the Bush administration has blocked all off-reservation applications nationwide.

Under gaming compacts worked out with the state, the Senecas share slot machine revenues with New York.

James M. Odato can be reached at 454-5083 or by e-mail at jodato@timesunion.com.