Wednesday, February 1, 2012
The Seneca's Half a Billion Dollar Question
There is no question that the State breached the Exclusivity Clause of the Gaming Compact with the Senecas. There MAY be some question as to whether the breach will (or should) cost the State all of the revenue it is hoping for, but only because of some very clever wordsmithing by the writers.
You see the "gaming devices" the State has installed in their own facilities DO breach the exclusivity agreement but the State is hoping that their "machines" fit into a "catagory" (not class) that allows them only to lose revenue from the Seneca's "machines" that fit into the same "category". Of course most of them won't.
Never mind that the entire spirit of the agreement has been breached by the State's proliferation of their own "casinos" and "racinos", clearly in the region carved out in the agreement. Everything from the scale to the financing of the Seneca gaming facilities relied on the premise that elimination of the threat of competition was purchased from the State with a percentage; kind of like buying protection from the mob. Only in this case the State has less honor.
So the State, as the regulators, with its unfettered access to the information on how many, what "category" of machines the Senecas operate and of course the revenue flow for each, makes the financial calculations and, ultimately, the decision that they can breach the agreement, pull significant customers and revenue away from the Seneca enterprises and STILL get paid their "protection" money.
The Senecas, for their part, finally stop paying. Under the advice of their "policy advisor", Rob Porter, the Senecas began to escrow the would-be payments. Now as that escrow account approaches $500,000,000.00 and the "policy advisor" is the Seneca Nation President, the question can only be: now what?
President Rob now suggests, having forced the issue of arbitration, that this money may indeed be lost in arbitration. Again, so now what?
The buzz is that half a billion dollars can buy a lot of favors, for someone. Who ever could be credited with getting this prize to the financially beleaguered State coffers sure would be owed a debt of gratitude (or something).
The half a billion dollar question is: who is getting played?
Do the Senecas really need to pay their "non-compete" protection money to their breaching competitors? Will this decision ever really make it to arbitration? Or will President Rob buy a partnership with Governor Andrew to secure his future beyond his gig with the Senecas? $500 million certainly will get someone something.
Is it possible that the very person who advised the hold back, convinced the Senecas they didn't owe it, already failed in an attempt to pay out some of it, is wearing out his welcome in his political party, community and nation and certainly is looking to advance himself past the Seneca Nation Presidency; was playing everyone all along? I guess maybe there is no half a billion dollar question but rather half a billion questions.