Tribe pitches economic benefits of casino to county

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The leadership of the Shinnecock Indian Nation told members of the Suffolk County Legislature last week that having a casino in the county, wherever it might be located, would be a financial boon to nearly every sector of the regional economy.

Also, for the first time, a tribal leader admitted publicly that the Shinnecocks never planned to develop the tribe-owned Westwoods property along Newtown Road in Hampton Bays, where a groundbreaking ceremony for a gaming facility was held in 2001—but instead used the property as a bargaining chip, with hopes of finding a more suitable site to the west.

In a pitch that focused on the financial windfalls and job growth that the mammoth Foxwoods and Mohegan Sun casinos brought to rural Connecticut, the Shinnecock tribal leaders told the five county legislators on the Economic Development, Higher Education and Energy Committee last week that a Shinnecock-sponsored casino would bring enormous benefits to Suffolk County if a suitable site were found.

Thousands of jobs, tens of millions of dollars in revenues for schools, police and fire departments, and business for local contractors would follow the development and growth of a casino, Shinnecock Tribal Trustees Fred Bess, Lance Gumbs and Gordell Wright told the legislators in a public presentation, the result of a request by the tribe, at the legislature’s offices in Hauppauge on Wednesday, May 8.

“Everywhere that Indian gaming has come into a community, it has been beneficial to everyone,” Mr. Gumbs told the panel of legislators, all from western Suffolk County districts. “The benefits that are available are absolutely phenomenal.”

The tribe pointed to the financial success of the two Connecticut casinos less than 50 miles away—the owners of which, they said, would be less than pleased with the Shinnecocks’ plans—as an example of the windfall the county could realize.

The Foxwoods casino in Ledyard, Connecticut, with 340,000 square feet of gaming space, more than 1,400 hotel rooms and some 10,000 employees, contributes more than $400 million in revenue a year to the State of Connecticut by virtue of the compacts on gaming its Native American owners, the Mashantucket Pequot, reached with the Connecticut state government. That revenue figure, according to the Shinnecock leaders’ presentation, was reported in a 2007 study prepared for an economic impact summit held by the Eastern Connecticut Chamber of Commerce.

The contributions to the state are expected to climb again in the coming years after the new MGM Grand casino and hotel opens on the Foxwoods property. Its construction is pegged to cost more than $700 million, including $426 million in construction workers’ salaries.

Mohegan Sun, a separate casino in nearby Uncasville, Connecticut, owned by a gaming authority created by the Mohegan Native American tribe, has comparable revenues and an even larger expansion project in the works, effectively doubling those figures across the board, tribal leaders told the panel.

For their part, the five county legislators were cautious and inquisitive about the role Suffolk County government would play in any approval of a Shinnecock casino within its borders. Legislator Louis D’Amaro made note of geographical differences between Long Island and Connecticut that could mean greater impacts on traffic, and he questioned whether the wages paid at the Connecticut casinos would match Long Island’s high cost of living. Both were issues that the tribal leaders said were on their minds already and are being examined by their consultants.

The legislators said that, all in all, they welcomed the Shinnecocks having reached out to them. “It never hurts to talk,” Legislator D’Amaro said.

A study prepared by a consultant for former Shinnecock financial backer Ivy Ong in 2002 predicted that a casino on Long Island could, because of its proximity to New York City, expect to draw millions of visitors a year soon after opening. That would spur rapid expansion of its gaming facilities and ancillary amenities, such as hotel rooms, entertainment venues, restaurants and nightclubs. The study found that a facility unlimited by land constraints could easily grow to the size of Foxwoods, the largest casino in the world, within a decade and could expect to bring in more than a $1 billion in revenues a year.

Mr. Ong, a California real estate investor, sold his financial stake in the Shinnecocks’ casino efforts in 2004 to Gateway Casino Resorts, which will have a stake in the future casino’s profits in exchange for funding the expensive legal battles along the way.

Prompted by Legislator Wayne R. Horsely’s question about the tribe’s vision for the future casino, Mr. Gumbs said the tribe hadn’t discussed a definitive size but said that there are formulas that predict what size is most economically feasible.

“It would be the size that would be most feasible,” Mr. Gumbs said, but he added that he expects it to be more than a gaming facility, saying any development likely would include a golf course, hotel rooms, convention space and entertainment venues.

“I believe New York State deserves and should have a world-class facility,” Mr. Bess added.

The tribal leaders dismissed concerns raised during their long legal battle with Southampton Town—the Shinnecock Reservation is located within the town, just west of Southampton Village—that a casino would bring crippling traffic, crime, prostitution and blight to the surrounding community, wherever it is built. The Connecticut casinos have produced none of these negative results, Mr. Gumbs claimed.

“That’s part of the hysteria that people try to create when they try to down the concept of gaming in a community,” he said. “It’s a form of entertainment, like going to the movies.”

The tribe’s attorney, East Hampton lawyer George Stankevich, told legislators that the tribe expects to earn federal recognition soon as a result of a lawsuit it has filed in federal court. Once the suit is concluded, the tribe will only have to secure land for the development, he said, since federal recognition will give the tribe the right to pursue a casino plan.

Though the tribe could, according to federal Indian gaming laws, build a casino on its 800-acre reservation, Mr. Gumbs and Mr. Bess said the tribe would rather build at a more central and suitable site farther west.

Mr. Bess said that the tribe’s 76-acre wooded Westwoods site in Hampton Bays was unsuitable for a casino, and he acknowledged that the tribe never really wanted to build there. In recent years, however, it used the possibility of development there as a bargaining chip, he said.

“You have to put a shovel in the ground to get anyone to listen,” Mr. Bess said.

The tribe broke ground at Westwoods in 2001 for what they said would at first be a small casino. Southampton Town sued and spent more than $2 million on attorney fees before a federal judge ruled last year that the property is not sovereign tribal land, like the reservation, and cannot be used for a casino.

The most likely route to development, Mr. Bess and Mr. Gumbs told county lawmakers, would be for the tribe to buy a large swath of land and place it in a federal trust, allowing it to be used for a casino. Mr. Gumbs said that the tribe had its eye on several properties on the East End and elsewhere throughout Suffolk that would be suitable for the size of casino they expect to build someday.

Mr. Gumbs referred to the federal lawsuit the tribe has filed, claiming a vast swath of Southampton Town surrounding the tribal reservation as rightful tribal lands. The land claim was dismissed by one court, but is currently under appeal. Mr. Gumbs said the claim was “very viable” but that the tribe would drop the suit if the state would agree to allow it to develop a casino somewhere on Long Island.

Hinting at the county’s expected massive budget shortfalls, Mr. Stankevich said that the purchase of a county-owned parcel for “tens of millions of dollars” could be the first large influx of money directly into Suffolk’s coffers, even before the tribe begins earning revenues from gaming.

“There are a number of negotiations that can take place,” he said. “The economic impact of a Shinnecock Nation casino could have momentous benefits for the tribe and all of Suffolk County.”

The tribe has expressed interest in a county-owned parcel that lies between Gabreski Airport and the Sunrise Highway in Westhampton. They had also met with members of the Riverhead Town Board about the potential purchase of the town-owned former Grumman property. Last year, the tribe and its financial backers proposed a $1.4 billion gaming facility at the Aqueduct Racetrack in Queens.

Mr. Bess, the chairman of the Tribal Trustees, said that presentation before the legislative committee was the first step in what he hoped would be a dialogue between the county government and the tribe—unlike the adversarial relationship that developed with Southampton Town government almost immediately after the tribe’s casino plans became public, he said.

“One of my goals here today is to open the door to communication and dialogue,” Mr. Bess said, “and sidestep some of the unfortunate issues we ran into at home with the Southampton Town Board.”

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