A Casino in Tyre Would Counter the Stated Purpose of the 2013 Casino Amendment
Summary: A non-Indian casino is proposed for Tyre, NY (Seneca County). Though better-situated to maximize gross gaming revenue than other current Region 5 candidate sites, a casino in Tyre would be a bait and switch trick on all New Yorkers. It could not head off gamblers who must leave the state to get to a full-service casino, yet to stop that outflow was the original legislative intent of the recent constitutional amendment to authorize casinos.
Every casino-goer resident in 75% of NYS has an Indian casino closer than any out of state, employing New Yorkers and (if agreements are concluded) ready to pass on a portion of gamblers’ net losses ( aka “gaming revenues” ) to residents of the host county and nearby counties. The Seneca County site proposed would be allowed by manipulated boundary lines (“gerrymandering”) to capture a large share of Indian casino markets. Its nearness to large metro areas would also create many new casino users, some of whom would become new gambling addicts and persons at risk for gambling addiction.
Other sites proposed for Region 5 (so-called “Eastern Southern Tier’) might not pull as much gross gaming revenue as the Seneca County location, but really would compete with casinos in Pennsylvania instead of those in New York State. These other sites would fit the stated legislative aim of the amendment much better than a site in Tyre.
Introduction : Tyre, NY (pop. 900) is a farming community at exit 41 (Waterloo) of I-90, halfway across narrow Seneca County. A month after New York State voters had approved a constitutional amendment to authorize “up to seven” casinos in the state, the Rochester development firm Wilmorite proposed a tract in Tyre it had recently acquired as the site for a $350 million casino. A Wilmot family member declared the firm meant to vie for the [probably] one casino license to be granted in the set of counties called in the Upstate Gaming Act “Region 5,” or “Eastern Southern Tier.”
An ardent opponent of predatory gambling, I have great sympathy for the many residents of Tyre who do not want their town ruined because some fellow-townspeople open the gates to a Trojan Horse. I hope earnestly they will show the Gaming Facilities Location Board (yet to be publicly named as of Feb 1) that “local approval” is not high enough to justify the Wilmorite site’s getting the Region 5 license. Leaving aside “local approval” for now, I call attention as a geographer to two features of the proposed location which make it wholly inappropriate in a State that theoretically aspires to be honorable in doing what it said it was going to do, for the reasons it told us.
First, a casino in Tyre would make “gaming exclusivity regions” promised on certain conditions in 2013 to two Indian gambling entities no longer exclusive even if the conditions are met. This is dishonorable, though within the letter of the law .
Second, detailed examination of the shape of Region 5 and the distribution of Indian casinos across the state also makes clear that the voters were sold “Proposal 1,” the amendment to legalize casinos, on grounds that the accompanying legislation (Upstate Gaming Economic Development Act of 2013) turned into mire. The amendment to legalize casinos as the Governor proposed it in 2012 was supposedly necessary to keep NYS “gaming” dollars in-state by allowing new casinos that would compete successfully with neighboring states on “virtually every border.” [Relevant audio starts at 25’30”.] The pretense that neighboring states are the problem was held to in the public relations campaign of the Gaming Act [See first few pages of the 47 slides]. The Gaming Act itself, however, does not mention as a criterion in site selection the potential for keeping gambling losses in-state, as opposed to out-of-state. Not at all. See pp. 14 and 15 of the slide show.
This essay explains how a Tyre site would be bad-faith statecraft and do nothing to stop New York casino-users from going to neighboring states unless Indian casinos disappeared. Instead of stopping current casino-users from exiting NYS, it would draw current users from Indian casinos and by increased convenience create new casino gamblers, some of whom would become new gambling addicts.
Part 1. A Tyre casino site is bad-faith statecraft A casino at exit 41 would be a trick on the Indians right out of the pages of tricks by exploiters. In 2013 Governor Cuomo got tentative compacts or memoranda of understanding with the Seneca Nation, the Hallbritter Oneidas and the St Regis Band of Mohawks by offering each entity an exclusivity region into which none of the [projected] seven casinos would go.
On the map below observe how Region 5, in green, is built with a thin corridor running north between two exclusivity regions. All counties to the west of Region 5 are in the Seneca exclusion region (Region 6); many counties to the east and northeast are in the Hallbritter Oneida exclusion region. Thus, a casino site in this corridor is not just along an edge of one exclusion region; it is at the heart of two.
Map of Region 5 (Eastern Southern Tier) and surrounding counties of New York State Region 4 is the Hallbritter Oneidas’ exclusivity region All counties to west of Region 5 are in Region 6, the Seneca exclusivity region. Region 1 (only the D of Delaware shows in the photo) is “eligible for gaming.”
Compare the region’s shape to the eponymous 1812 gerrymander in Essex County Massachusetts shown below. (reproduction c/o Wikipedia)
Who designed Region 5? Was it meant from the start to trick the Indians? More likely, it was contrived to bulk up the relatively small “Eastern Southern Tier” region “eligible for gaming” by tacking on parts of two counties not on the Southern Tier. This freed the planners from having to “award” outright Seneca County and half of Wayne to one or the other contender (the Senecas and the Hallbritter Oneidas) or else partition them,* avoiding the charge that they were giving everything away to the Indians. The result was the shape of Region 5. It can be seen as a buffer zone between two competing parties but equally as a wedge by which to insert something unwanted by either.
Everyone knows that a competitor may ethically set up shop just outside a sector from which he or she is excluded. What do we say, though, if the one shop is just outside two supposedly protected sectors, and if the range of what is offered is not city blocks but scores of country miles? Is this just opportunistic hardball or bad faith?
A sidebar on range, Geographers speak of the range of a good (or service) as the maximum distance or travel time a consumer will accept to get a certain good or service at a certain price. The lower the price, the longer the range. The rarer the good, the longer the range. In Manhattan, most people won’t walk more than two blocks along Broadway just to buy takeout regular coffee for $1.50; they might walk three blocks to buy at $1.25. Two blocks is the range of $1.50 coffee in that neighborhood. Thus there is at least one shop selling it every three or four blocks along Broadway. Other goods have greater ranges. The range of seeing a hit Broadway show on Broadway or a live opera at La Scala is 12,000 miles. Granted, not many people will venture so far for the unique experience, but no one will fly from Shanghai or Bahrain to buy cheap coffee in Times Square. [End of sidebar on range] *********************************************************************************************
It depends on who created the “opportunity.” In a free market, total sales are maximized by having an outlet within the range of as many potential customers as possible until saturation occurs. In a government-regulated oligopoly (e.g. non-Indian casinos in the USA) the range of a full-service casino is at least 100 miles. We have heard for years about all the NY license plates in out-of-state parking lots to which the travel one-way is that or more. The range of ten VLTs in a bar in South Dakota is much less; thus such arrays proliferate in that state, where Indian casinos are more widely spaced. With a 100 mile range, a casino can reach deep into “exclusivity regions” where a hot dog vendor cannot.
In a truly free market, a casino in Tyre would be a master stroke of capitalism. Casinos in New York, however, are not in a free market. The locations of Indian casinos are constrained by federal law. Locations of new commercial casinos will be regulated by new state law. If the State were to allow a casino by the Thruway in the Seneca-Wayne corridor, that casino would be ideally located to compete at once with Turning Stone and with the Seneca casinos. This would upset a key element in the tentative agreements made by the State in 2013 with the three Indian entities named above: to insulate them (not immunize, of course) from competition by the new casinos. The proposed exit 41 site is a few miles outside both their respective exclusivity regions, but an easy drive from the city with the largest economy in each, as the table of road distances shows.
from downtown Syracuse to
Thruway interchange 41 (aprox location of Tyre site) 40 mi. west
Turning Stone (TS) 37 mi. east
from downtown Rochester to
Thruway interchange 41 47 mi. east
Buffalo Creek Casino 76 mi. west
from Turning Stone to
Buffalo Creek Casino 179 mi. west
Convenience is a very important factor in consumer utility. I will assume (despite rumors about “looser slots” here or “less experienced dealers” there or “better comps” elsewhere) that all casinos offer a similar product; thus, convenience (travel time) is paramount in choosing one, if there is a choice. Most Syracuse residents are about equidistant from Turning Stone and from Tyre. On convenience they are indifferent; neutral; if there were a casino in Tyre, pure convenience would not motivate their choice. The attractive novelty of a casino at Interchange 41 for Syracusans would be to now have a choice where before they had none. Rochester residents, on the other hand, would not be indifferent. Most would choose the forty-seven miles to Tyre over the seventy-six miles to Buffalo.
A casino in Tyre, reaching deep from “outside” into two supposedly protected markets would challenge the Indian gambling entities in a way that shows contempt even for Indians who don’t support gambling. In today’s terms, it’s a “gotcha.” Maybe the Indian gambling operators are quietly mobilizing against it. Maybe this threat to them explains rumors about a new, third, Seneca casino that would go up near Rochester. I don’t think any of last summer’s agreements have been made final. They could be torn up unratified or rescinded, yet the Gov would not be heartbroken. One of his major reasons for negotiating draft agreements was to prevent the Indian gambling forces from fighting the amendment. They didn’t. Surely the Governor would also like to see payments by compact start flowing to Albany and to counties in the Indian exclusion zones, but might be willing to forgo those. He got what he really wanted already: the amendment along with the Upstate Gaming Act of 2013. The revenue to government from the yet– to-come “downstate” casinos would make that from Indian casinos dispensable.
In 2012 the Governor spoke only of “neighboring states.” Did he mean then that “tribal casinos,” not being “regulated” by the State, were part of the same drain as surrounding states and Canada? In January 2012 the latter was true in a way, as the State was getting little or no revenue from the Indian gambling operations. Payments by compact (where there had been a compact) were frozen. In 2013, however, the Governor’s team, using the threat of invasive competition and the carrot of land claim and payment concessions, brought all three Indian entities into “good standing.” Entities in “good standing” agree to deliver significant portions of their slots revenues to Albany or to regional counties, assuming the agreements are ratified.
If a casino license awarded to Wilmorite were to make the Senecas and Hallbritter Oneidas back out, citing more broken promises looming, they might not lose a lot. The legislature could rewrite the Upstate Gaming Act to undo the exclusion regions, but probably would not bother. It is hard to think of even two commercial casino locations inside Region 4 (Hallbritter Oneidas) or Region 6 (Senecas) that could do more hurt to NYS Indian gambling interests in toto than one in Tyre. What New York State government really wants is casinos in Zone 1 (“downstate”) and Region 1 (Catskills mid-Hudson) of Zone 2. Locations elsewhere are just chumming or competing like a trickster with Indian entities to reap the casino gambling losses of upstate New Yorkers.
Part 2. A Tyre casino site would not stop any leakage to out of state. Besides being a trick on Indian gambling interests, a casino in Tyre would be the old switcheroo on New York voters. It would not stop any leakage at all to neighboring states and Canada.