Rochester developer David Flaum has been working to build a casino in the Catskills for more than a decade. Now he's rolling the dice on a new proposal to give the state $500 million in exchange for a Seneca Indian Nation casino there.
The Senecas would agree to build a casino in Buffalo — their third casino in western New York — in exchange for a state compact to build a casino in either Sullivan or Ulster County, Flaum said Tuesday.
The tribe would also agree to give the state $500million over seven years, on top of the state's 25 percent cut of slot machine revenue from a Catskills casino.
The tribe and Flaum, who in 2003 got a letter of intent from the tribe to develop a Catskills casino, are eager to jump into the lucrative Catskills gambling market, just 90 minutes from New York City. He also owns 500 acres off Route 17 near the Sullivan County border.
Seneca President Barry Snyder said Flaum is trying to see if a deal can be struck between the tribe and the state. He said the tribe has not agreed to Flaum's proposal but would be willing to build a casino almost anywhere if it could get one in the Catskills.
"Give us the Catskills, we'll put it anywhere," he said.
The Senecas chances may be hindered by a reluctance to collect taxes on cigarettes and other sales on sovereign land. The tribe is also unwilling to drop outstanding land claims in exchange for a new casino compact, Snyder said.
Snyder said Flaum's proposal so far hasn't received much interest from the tribal council or Gov. George Pataki's office.
In recent months, the Republican governor has reached land claim settlements with four tribes, and all include price parity or sales tax agreements. A fifth deal is being negotiated with the St. Regis Mohawk Tribe.
Flaum said the $500 million offer could entice the state to bypass a tax agreement.
"It's going to take a long time to collect 50 cents on a pack of cigarettes to get to $500 million," he said.
Last year, the Seneca-Cayuga Tribe of Oklahoma and Rochester developer Thomas Wilmot proposed building a casino in downtown Rochester.
However, the deal was scuttled partly because the Seneca Indian Nation has exclusive casino rights in western New York, including Rochester.
As a result, there is often speculation that the tribe may one day seek a new state compact for a Rochester casino. Flaum and Snyder said the tribe has no immediate interest in doing that, but added nothing is off the table.
Pataki wants to allow five other tribes to build casinos in the Catskills, two more than the state Legislature approved in 2001.
The 2001 agreement also allowed the Senecas to build three casinos in western New York.
The tribe has already opened casinos in Salamanca, Cattaraugus County, and Niagara Falls.
The third, destined for Erie County, remains in dispute. The Senecas have proposed building it in suburban Cheektowaga, but local leaders want it in Buffalo.
Pataki spokesman Todd Alhart declined comment on Flaum's deal.