Seneca Nation Files Response to Arbitration Demand

Posted in: News & Announcements

CATTARAUGUS TERRITORY, IRVING, N.Y. – The Seneca Nation has filed its
official response to the Arbitration Demand filed by New York State earlier this
month.

In the response filed today, the Nation asserts its compliance with the
provisions of the gaming Compact it signed with New York State in 2002, notably the
provisions related to the Nation’s 14-year revenue share obligation, which the Nation
fulfilled earlier this year.

According to the language of the Compact, the Nation agreed to pay a
percentage of the slot machine revenue generated at its three casinos for a period of
14 years. The payment schedule and payment percentages prescribed in the
Compact reads:

Years 1-4
18%, with “Year 1” commencing on the date on which
the first Gaming Facility established pursuant to this
Compact begins operation, and with Payments during
this initial period . . . to be made on an annual basis.
Years 5-7
22%, with payments during this period to be made on a
semi-annual basis.
Years 8-14
25%, with payments during this period to be made on a
quarterly basis.”

Since opening Seneca Niagara Casino in 2002, the Seneca Nation sent more
than $1.4 billion in payments to Albany. In accordance with the Compact, the Nation
made its final payment to New York State in March.

“The Seneca Nation has faithfully honored the agreement we negotiated and
signed in good faith in 2002,” said Seneca Nation President Todd Gates. “New York
State has a documented history of Compact violations, despite collecting more than
$1.4 billion from us over the past 14 years. Now, the state is trying to create a
reality that does not exist. You can’t change the rules 15 years into a 21-year
agreement. Enough with the political posturing and insults. Honor the agreement,
just as the Seneca Nation has done.”

According to the Nation’s filing, “The text of the Compact contains absolutely
no requirement for payments beyond those three payment periods. Nor does it set a
rate at which any such additional payments would be made. In its Demand for
Arbitration, the State makes no attempt to identify any provisions to this effect in
the Compact, and none exist.”

The arbitration filings come almost six months after the Nation made its final
required payment in late March. At that time, President Gates spoke directly with
Governor Andrew Cuomo, who asked President Gates if he would be willing to meet.
Governor Cuomo subsequently canceled two meetings with President Gates, one in
July and one in August.

“For the state to say that the Nation was not willing to meet is a blatant lie
and the height of hypocrisy,” President Gates added. “It was the state, and the
Governor specifically, who was unwilling to meet with me and engage in productive
dialogue. The Governor spent almost half a year avoiding meeting with me.”

A three-member arbitration panel will now be empaneled to hear arguments
on the matter. The Seneca Nation and New York State will each make a selection to
the arbitration panel, who will then select a third, mutually-agreeable panel member.

“While the Seneca Nation was open to dialogue, we are now moving forward
with the arbitration process initiated by the state,” President Gates said. “Arbitration
will allow the facts, not the Governor’s fictional narrative, to stand on their own.”