Categories: CasinoIndustry

Auditors Warn Niagara Falls May Struggle Financially Without Casino Payments

The dispute between the state of New York and the Seneca Nation of Indians continues. The state’s Comptroller’s Office said on Wednesday that the city of Niagara Falls may lose a huge amount of finances thanks to the Senecas’ decision to stop paying their slot revenue to the state.


Back in February, the Seneca Nation decided to stop contributing the revenue. A 2002 deal between the state and the tribe said that the Senecas would pay 25 percent of its yearly slot machine revenue to the state from its three casinos in the western part of the state. The money was then divided evenly among state coffers and local communities.

If the issue continues without a resolution, auditors say that the city of Niagara Falls is at risk of a major budget impasse over the next few years. Niagara Falls has been spending $9 million of the casino revenue to fill recent budget gaps since 2014. The city, which is home to Seneca Niagara Hotel & Casino, has received revenue from the Senecas for 14 years.

The Comptroller’s Office reported that the city of Niagara Falls has become highly dependent on the revenue payments being made. The lack of money coming in may seriously harm the city’s financial wherewithal. A recent audit showed that Niagara Falls’ casino fund has decreased from $44 million in 2013 to just over $25 million at the end of May of 2017. By the end of 2018, Niagara Falls could be without the casino finances altogether. The state has since urged city officials to come up with alternative budgeting solutions.

Mayor’s Response

Niagara Falls Mayor Paul Dyster told local reporters that his city is not on the verge of running out of finances nearly as quickly as auditors suggest. He did, however, admit that his city has seen better days as far as money is concerned. Dyster did add that Niagara Falls has ample reserves if necessary to bridge the gap between now and whenever the dispute between the Senecas and the state of New York is resolved.

The Senecas have been annually paying in the vicinity of $100 million to the state since the aforementioned 2002 deal was struck. The contract expired on New Year’s Eve of 2016, though, and a new compact hasn’t been agreed upon. The Senecas announced in February they had no interest in coming to a new agreement.

The Senecas were turned off by the opening of three new casinos in Upstate New York, one of which will open in early 2018. The Senecas are arguing that New York breached its part of the deal by greenlighting the new facilities, which the tribe believes will cut into its own casino revenue.

Automatic Renewal

As you may imagine, New York state officials are none too pleased that the tribe has decided to stop making payments. Officials believe the deal automatically renewed once the calendar flipped to 2017. New York says a provision in the old deal caused the deal to automatically vest for an additional seven years if neither side objected.

Taylor Smith

Taylor Smith has been a staff writer with since early 2017. Taylor is primarily a sports writer, though he will occasionally dabble in other things like politics and entertainment betting. His primary specialties are writing about the NBA, Major League Baseball, NFL and domestic and international soccer. Fringe sports like golf and horse racing aren’t exactly his cup of tea, but he’s willing to take one for the team on that front every now and then.

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