LITTLE VALLEY — Cattaraugus County officials welcomed news that the Seneca Nation will drop legal action against New York state over casino revenue sharing and begin talks leading to a new gaming compact.

“It’s certainly is good news,” said County Administrator Jack Searles on Thursday. “We are certainly optimistic about it. ... I’ve already had a couple of people approach me and ask what we are going to use the money for.”

County lawmakers have called as well, wondering how much the county might receive in a settlement between the Seneca Nation and the state through the state’s 25% share of slot machine revenue at the Senecas’ casinos in Salamanca, Buffalo and Niagara Falls.

The short answer from Searles is that he doesn’t know — he hadn’t heard from the governor’s office by late afternoon Thursday. Like others, he said, he read about it in the newspaper that morning.

Seneca President Matthew Pagels announced the agreement between the Seneca Nation and the state during a 5-minute video posted on Seneca Media Wednesday night. The agreement includes plans to meet within 60 days to begin talks on a new compact, he said.

Gov Kathy Hochul welcomed the Senecas’ action as well.

“I am pleased to have reached an agreement for the resumption of payments on terms that serve both the State and the Nation and that benefit Western New York communities, and I look forward to beginning discussions toward a new compact,” she said in a statement.

“I have no idea about the timing,” Searles said. “We’ve had no formal contact. We find out about these things from the media.”

The last time the county received a quarterly payment from New York state was the second quarter of 2016.

The Senecas announced the following spring that they interpreted the gaming compact did not require payments to the state in the last seven years of the pact. That set off a four-year legal effort that led to a string of defeats for the Senecas, including arbitration and federal court decisions.

Searles said the last revenue sharing payment from the state covering slot machine revenues from the Seneca Allegany Casino totaled about $1.9 million.

The city of Salamanca, the Salamanca school district and Cattaraugus County have an agreement to divide the revenue sharing payments from the state. The first tier payments call for replacing property tax revenue lost when a member of the Seneca Nation purchases property on the Allegany Territory in the city of Salamanca.

Other tiers of revenue sharing were used to cover direct costs and economic development efforts. The last payments did not include enough revenue to cover second tier costs, Searles said.

Cattaraugus County received $318,476 from that second quarter payment in 2016, the city of Salamanca received $248,570 and the school district got $1.4 million, Searles said. Of that amount, $701,105 was to cover property tax losses and a little less than $1.03 million toward direct costs.

The Senecas have placed nearly $500 million in escrow to be able to pay for the settlement with the state.

“I don’t know what the split (for the Seneca Allegany Casino) will be,” Searles said. “I don’t know what the impact of COVID-19 has been on slot machines at the casino.”

Based on the last revenue sharing payment in 2016, the county would receive a back payment from the state of $1.2 million that year. If the county’s share were reduced to as little as $1 million a year, it would still be a more than $5 million payday.

Searles expects legislators will be talking about how to use the funds. “They are aware of it and they’re talking about it now,” he added.

The city of Salamanca is reportedly eyeing revenue sharing payments of $20 million or more, but owes the state about $15 million it has borrowed against the expected casino payment. Mayor Sandra L. Magiera could not be reached for comment.

Assemblyman Joseph Giglio, R-Gowanda, said he was glad that the issues have been resolved and work can now begin for a solution for the Nation and for the communities in which casinos are located.

“Negotiations for a new compact to replace the current agreement, which is set to expire next year, will give all parties involved the opportunity for a fresh and prosperous working relationship,” the assemblyman said.

(Contact reporter Rick Miller at rmiller@oleantimesherald.com. Follow him on Twitter, @RMillerOTH)

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