NY’s tough call on casinos

This is the beginning of City’s general-election coverage. The coverage continues in the October 16 and October 23 issues. We’ll look at the elections in Greece, Irondequoit, Monroe County, and the City of Rochester, and have special coverage of the Green Party of Monroe County. The general election is Tuesday, November 5.

Mayor Tom Richards often speaks about a Rochester-area casino as an inevitability, and he could be right. The Seneca Nation’s interest in the area and the upcoming statewide vote on casino gambling almost make it feel as if casinos are closing in on all sides.

But there are two distinct things happening. First, no casinos are planned for the Rochester area as a result of the referendum on the November ballot, which would permit up to seven casinos in the state.

Second, the Seneca Nation of Indians has exclusive gaming right to much of New York’s western end, which means that any potential Rochester casino must be run by the Senecas. (A representative of the Seneca Nation did not return calls for comment.)

And though the Seneca Nation has expressed interest in opening a casino in the Greater Rochester area, a site hasn’t been chosen and not all officials believe that casinos are the panacea for upstate’s ailing economy.

“I don’t see us basing our economy on casino gambling,” Richards said in a previous interview. “It’s hard to point to another upstate city right now that has gambling that has benefited greatly from it. They get money from it, and there are certainly jobs from it. But has it turned around the city or the economy? I think that’s questionable.”

If the referendum is approved, Governor Andrew Cuomo’s plan is to have four casinos upstate: two in the Catskills, one in the Southern Tier, and one near Albany. Eventually, three additional casinos could open in New York City.

New York needs the jobs, Cuomo says, and the money from the gambling taxes that the casinos would bring. And the reality is that the state already has gambling in the form of racinos and other outlets, he says.

“It’s not a question of should we have gaming or should we not have gaming,” Cuomo told the New York Times last May. “The question really is should we recognize the reality of our situation and fully participate?”

According to a press release from the state’s budget office, the Western New York-Finger Lakes region would receive an additional $93.1 million annually in local government aid as a result of the November referendum, called the Upstate New York Gaming and Economic Development Act.

But others say that visions of financial windfalls for communities as a result of casinos are overblown, and that all these new casinos will do is rob from existing casinos and gambling outlets.

“I’m not sure where we are in the economics of this,” Richards has said. “Cuomo makes [the] argument that we shouldn’t allow this money to go to other states. Maybe he’s right about that. Nonetheless, if you look at that from a global point of view, he’s conceding that there’s only so much money here and we’re going to share it.”

And casino revenues are down, including in Atlantic City. Competition from Pennsylvania casinos is thought to be responsible for Atlantic City’s predicament.

A wild card was thrown into the discussion last week when Brooklyn attorney Eric Snyder filed a lawsuit against the casino proposition. The referendum’s rosy wording — “promoting job growth, increasing aid to schools, and permitting local governments to lower property taxes” — amounts to advocacy, he says, and that violates the state Constitution.

The Cuomo camp says that the Board of Elections is solely responsible for the wording. But it’s worth noting that board members are appointed by politicians.

The Seneca Nation has been eyeing the Rochester area for a casino for some time, and recently hired a local developer to investigate the possibilities. Henrietta and to a lesser extent Irondequoit have been mentioned as potential locations.

Richards has said that he is opposed to a casino in downtown Rochester for the kind of statement it would make about the character of the area.

“I don’t know that putting a casino in the middle of downtown is necessarily what my vision of downtown is,” he said.

There are also legal and social issues that come with taking a large piece of property and putting it under the absolute control of the Seneca Nation. In exchange, the involved governments typically get a negotiated piece of the casino’s gross take, Richards said.

The sovereignty issue also bothers City Council President Lovely Warren, who is the Democratic candidate for mayor.

“That, to me, really hurts our chances of having a casino in our downtown,” she says, “because how could you put a sovereign nation in the middle of your downtown?”

Steve Siegel, formerly of the College of Hospitality and Tourism Management at Niagara University, says that politicians and the public tend to abandon their good judgment when it comes to casinos because they’re intoxicated by dollar signs.

“What we rarely hear about is the devastating negative economic impact that research shows occurs when a tax-exempt casino is placed on what is claimed to be sovereign land within an urban setting,” writes Siegel in a 2011 report.

All of the gain goes to the casino complex, Siegel says, and local businesses are devastated because they can’t compete with this massive nontaxable entity.

“Trapping people has been the business model,” Richards said. “That’s why they give you cheap food, booze, lodging. They want you to spend your money at the gambling table. That’s the Las Vegas model, the Atlantic City model. It is the model in Niagara Falls, and one of the tensions.”

“You don’t want an island of prosperity in the middle of a disenfranchised, difficult area, which is kind of what Niagara Falls wound up with,” Richards said.

Harry Bronson, who represents Henrietta, Chili, and parts of the City of Rochester in the State Assembly, says his primary concern is that the public gets ample opportunity to participate in the casino discussion.

“This is all a very fluid situation,” he says. “It’s not like any of this is a done deal.”

This article appears in Oct 9-15, 2013.