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#1 Nov-12-2007 06:45:am


City Must Cover Casino Costs

City Must Cover Casino Costs

11/12/2007 - State Awaits Seneca’s Payment; Salamanca Must Borrow Money

By Sharon Turano, sturano@post-journal.com

SALAMANCA — As the Seneca Nation of Indians continues to work on making its annual casino payment to the state of New York, some benefactors of the money are starting to worry about whether it will be soon enough for them to pay their bills.

According to an agreement with the state, the Seneca Nation owns and operates three Western New York casinos. It annually pays a share of slot-machine revenues to the state, with 25 percent of that going back to hosting municipalities.

Although the payment was made in September 2006 and in May 2005, it has yet to be made this year.

One state official previously said she expected the payment to be made Nov. 8. That day came and went, and, no payment. Despite that, Maurice A. John Sr., nation president, said the payment will be forthcoming.

‘‘We are moving to make the payment in a timely manner in accordance with our compact (with the state),’’ he said.

That agreement does not give a specific date for the payment to be made.

‘‘We’re going to borrow next Wednesday,’’ said Mayor Jeffrey L. Pond Sr.

He said $950,000 will be borrowed as a revenue-anticipation note for three months.

‘‘We’re using a surplus to continue paying people working for us,’’ Pond said.

He said the casino payment is about a full year behind. In the meantime, Pond said, the city has hired extra personnel in its fire and police departments to cover costs associated with the casino.

David Paoletta, Salamanca planning director, said the city had to borrow $900,000 last year when the city paid costs associated with hosting the casino but the revenue check was not paid by the nation to the state until September. The city does not have this year’s payment in November, and costs associated to hosting the Seneca Allegany Casino have increased, he said.

‘‘Borrowing is probably a foregone conclusion,’’ he said. Paoletta said three police vehicles have needed replacement and two more police officers hired due to more traffic flow when visitors come to the gaming facility, located in the city. An engineering firm, he said, has done traffic counts and is tabulating the increase. City officials will meet with Empire State Development officials next week to go over the expenses they have incurred. The state officials will then determine what is related to the casino.

‘‘We’re spending money as a result (of having the casino in the city) ...and not getting reimbursed,’’ Paoletta said.

Matt Roberts, spokesman for state Sen. Catharine Young, R-Olean, said she is concerned when ‘‘costs like these get passed down to the taxpayer.’’

‘‘Through borrowing,’’ Roberts said, ‘‘the taxpayer ends up suffering costs of borrowing.’’

Other officials representing municipalities that are casino revenue benefactors are not yet in need of borrowing.

Jack Searles, Cattaraugus County administrator, said the only amount the county budgets for is reimbursement of taxes Senecas do not have to pay when they buy land on their Allegany Territory, located in the county. In 2007’s county budget, $500,000 in revenue was budgeted for property that comes off county tax rolls, and, in 2008, he said $548,653 is expected.

‘‘We’re anxious to make sure we’re whole on that, but we’re fine at this point,’’ he said about covering expenses. Searles said the county’s fund balance gives it the ability to have funds carry-over and cover expenses so there is cash flow.

‘‘At this point, there isn’t a negative impact,’’ said Interim Salamanca City Central School District Doug Hay. He said by the time the nation pays the state, and that money is returned to the district, it is usually spring, so he does not count on receiving the $600,000 the district expects until then.
http://www.post-journal.com/Sports/arti … leID=21697


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