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The Real Villains

There is a document in which the Seneca Gaming Corporation—the three subsidiaries of which run the Seneca Nation’s gambling operations in Niagara Falls and Salamanca, and their planned gambling operation in Buffalo—specifically enunciates its economic vision for Buffalo. The subsidiary running the Buffalo operation is the Seneca Erie Gaming Corporation (SEGC).

The document specifically contradicts everything SGC board chairman and chief spokesman Barry E. Snyder, Sr., has said about the planned customer base for the Buffalo Creek gambling operation. It specifically contradicts what Snyder has said is the planned relationship with Buffalo and Buffalo’s waterfront development plan. It specifically contradicts what former Buffalo Mayor Anthony Masiello and current Buffalo Mayor Byron Brown say the casino will do in Buffalo.

The document is the 2005 10-K financial and operating conditions report the Seneca Gaming Corporation (hereafter “SGC”) filed with the Securities and Exchange Commission. 10-K reports and the 10-Q quarterly updates are, by law, public.

(You can find all the reports filed by the SGC on the SGC website: www.senecagamingcorporation.com/secFilings.html.)

The Securities and Exchange Commission requires only publicly traded companies with more than $10 million in assets whose securities are held by more than 500 owners to file these financial disclosure reports. The SGC is not publicly traded and it has only one owner—the Seneca Nation of Indians—so under normal conditions it would not have to make any public reports at all. We would know nothing about its real plans. But when SGC sought to borrow $500 million in unsecured senior notes in 2004 and 2005, the lenders—Merrill Lynch, Bank of America and Wells Fargo—insisted that it submit to the same audited reporting requirements as a publicly traded corporation.

Unless you’re an accountant or banker or investor, documents like these are dry as dust. There are pages of numbers, a huge amount of repetition and leaden prose. For the most part, this one is no exception.

There is, however, one passage in it that, as far as Barry Snyder’s statements and promises about Buffalo are concerned, is as clear as glass.

But first, some necessary context.

Barry Snyder’s March 23 letter

According to a March 23 letter from Seneca Erie Gaming Corporation chairman Barry E. Snyder, Jr., to Buffalo Mayor Byron Brown and Common Council President David Franczyk, the Seneca Erie Gaming Corporation wants the city to underwrite $6.6 million of street construction and to give it a city street, all in the service of the casino SEGC hopes to build in the heart of town.

That is known because last week an article about the March 23 letter appeared in the Buffalo News. The focus of that article was on the apparent disjunction between Barry Snyder’s hissy fit when the Common Council asked him to put one of his promises in writing and his attempt to get the same Common Council to give him $6.6 million of public dollars and a city street so he could make money.

But there is perhaps something more, or at least equally important in the opening paragraph of Snyder’s letter, which goes:

“This letter is to follow up on our discussions held at the Seneca Niagara Casino & Hotel on February 24, 2006 between Seneca Erie Gaming Corporation, Deputy Mayor Casey, Common Council members Bonifacio, Russell and Golombek, Commissioner of Public Works Joseph Giambra, and both of you. The discussions began laying the foundation for building a premier gaming facility on the Buffalo Creek Territory within the City of Buffalo, which will create at least 1,000 new jobs and hundreds of good-paying union construction jobs. Furthermore, our proposed Seneca Buffalo Creek Casino will deliver millions of dollars to the City of Buffalo through the revenue share agreement, create a vehicle to help stop the flow of Buffalo gaming business to Fort Erie, Canada and help spur further economic development in the Inner Harbor area of downtown Buffalo.”

Except for the first sentence, everything in that paragraph is untrue or misleading. The first sentence is probably true, which is, for the citizens of Buffalo, just as bad.

The City’s silence

The letter is what is called an aide-memoire—a memo summing up for the participants in a meeting what the writer wants them to believe or remember happened at the meeting. An aide-memoire puts on paper details everyone involved presumably already knows. According to this one, even the detailed specifics of how the city’s $6.6 million would be spent and what city property would be handed over to the Seneca Erie Gaming Corporation had been outlined at the meeting and emailed immediately afterwards to Mayor Brown and Council President Franczyk.

The surprising part isn’t that SEGC is trying to get the city to spend money it doesn’t have so SEGC will be able to make the city poorer than it is. The surprising part is the silence about this request by Mayor Byron Brown and Common Council President David Franczyk for a month after the request had been made.

Why didn’t they call a press conference immediately telling everyone that not only did the SEGC want to take our money and a city street, but they also wanted us to pay a huge piece of their expenses doing it?

Why, moreover, were seven members of Buffalo’s government trekking up to Seneca Niagara Casino to listen to Barry Snyder and his staff put the arm on the city? Shouldn’t beggars be the travelers?

Surely their expedition wasn’t to make an on-site inspection of the development surrounding Seneca Niagara Casino. There isn’t any development surrounding Seneca Niagara Casino. The decline of small business in Niagara Falls has accelerated since Seneca Niagara set up its 24-hour, tax-exempt store and bars in which you can smoke.

What was really going on at that meeting? Why didn’t they tell us about it? What else was discussed?

The rest of that paragraph

Take the points one by one:

—“which will create at least 1,000 new jobs”: Yes, there will probably be a thousand jobs in the casino. But, if Buffalo is like every other city with a downtown casino, they will come at the cost of far more jobs elsewhere in the community. Very soon after the casino is in operation, fewer people will be working, and the people who will be working will work at lower wages and without the benefits and protections the state provides workers not on somebody else’s sovereign territory.

—“deliver millions of dollars to the City of Buffalo through the revenue share agreement”: They’re asking in this letter for the city to cough up more cash than they’re expecting to pay in the first year, and nobody is yet talking about the huge cost of expanded water mains and sewer lines, continuing expenses for additional police and medical services, etc.

—“create a vehicle to help stop the flow of Buffalo gaming business to Fort Erie”: The money lost in Fort Erie’s slots from Buffalo is indeed money that leaves Buffalo. But Buffalo money lost in Seneca Nation slots is also money that leaves Buffalo. Buffalo would be no better off having a casino here but, because the casino would kill many local business and will pay no sales, occupancy, real estate or other taxes, and because it would be more convenient for locals to gamble downtown than in Canada, the city will be far worse off than it is now.

—“and help spur further economic development in the Inner Harbor area of downtown Buffalo.” Like much of the rest of this paragraph, this promise echoes Snyder’s February press release, in which he said, “The Seneca Nation plans to invest millions of dollars and create thousands of new jobs for Buffalo’s economy…Our sole intention in the City of Buffalo is to continue to build upon the economic success we have created and to develop a world-class facility that will help attract a critical mass of visitors to the city’s Inner Harbor area.”

All of that was no truer in February than it was in March or than it is now. Which brings us back to the Seneca Gaming Corporation’s 10-K.

The Seneca Gaming Corporation’s 10-K

Corporate documents have their own language, so I asked Buffalo attorney Rachel E. Jackson to look at the SGC’s 2005 10-K and tell me what it was saying about their real plans for Buffalo. This is what she wrote in response:

Contrary to the Nation’s public statements regarding its intended patron market for the Buffalo Casino, the Nation clearly intends to target the Buffalo and nearby residents as its primary market. The Annual Report states that the “Seneca Buffalo Creek Casino is expected to target the local Buffalo market and its suburbs.”

The Seneca Niagara Casino will be the “flagship resort property catering to mid to high value gaming patrons,” while Seneca Allegany Casino targets and “Seneca Buffalo Creek Casino will target mid-level gaming patrons with frequent visits.” SGC intends to increase marketing of the Niagara Falls casino to Ohio, Pennsylvania and Toronto residents.

There is no mention of marketing the Buffalo casino to anyone but local and nearby residents. The SGC and its subsidiaries attribute its success thus far to “an underserved local market with limited gaming and entertainment options; a favorable demographic mix; limited competition; and easy access by major interstate highways.” This further substantiates the Nation’s intent to exhaust the “underserved” Buffalo and nearby resident markets.

The Buffalo Creek casino is not being built as a destination casino; it is not being built for distant visitors. It is being built to attract local gamblers.

Yes, they’re building a hotel on their Buffalo property. But that hotel is just for a small portion of the gamblers they expect to attract, or for locals too drunk to drive home or not ready to go home and admit they’ve given away the mortgage money. The gamblers they are specifically targeting in the market plan for the Buffalo casino are primarily people who live within an easy drive of Buffalo’s Cobblestone and Waterfront Districts, people who will, they expect, choose to gamble away their discretionary dollars rather than spend them on local restaurants, hockey games, theaters, movies, bars, shops and waterfront attractions. And if those gamblers do want to have a restaurant meal or buy expensive presents, they will do it in the tax-exempt, Seneca-owned shops within the casino itself. They won’t go outside, they won’t spend outside.

The Seneca Creek Casino is planned, therefore, to be in direct competition with Buffalo’s development efforts. It is planned to suck customers and money away from every part of the Buffalo economy. Not unknown strangers from distant cities. Local people, people like you.

Perjury and fraud

How do you reconcile that with Snyder’s February claim that they are creating and developing “a world-class facility that will help attract a critical mass of visitors to the city’s Inner Harbor area” and with his March claim that a Buffalo casino will “help spur further economic development in the Inner Harbor area of downtown Buffalo”?

You don’t. You can’t. Barry Snyder’s press statements and aides-memoire are just words on a page, like all press statements and aides-memoire, but a Securities and Exchange Commission 10-K is a legal document about an organization’s financial position and plans. Get caught lying in a press statement or aide-memoire and folks say, “Business as usual.” Get caught lying in a sworn statement to the SEC and you wind up in the dock for perjury or fraud. If the press releases and aides-memoire and the SEC 10-K differ, go with the 10-K, since that’s the one in which lies can result in jail time.

Which is why the Common Council was right to want everything in writing, and why they should get it all sworn and notarized. And why they should start looking at the aspects of this whole project that have thus far remained hidden from public inspection, or left undiscussed and unclarified in unsworn press releases and press conferences, and in private meetings on somebody else’s turf in another town.

The frozen lake of Dante’s Hell

Barry Snyder is a big-time reservation tobacco dealer and chairman of the Seneca Gaming Corporation, the front man in the effort to establish a gambling casino in downtown Buffalo. Demonizing him in this matter is perhaps too easy. He’s a businessman trying to make a buck, a lot of bucks, and if he can find a bunch of suckers willing to give him their money, well, why shouldn’t he move in and grab what he can? If he can find government officials dumb enough to give him public money and public streets, why shouldn’t he take what they’re willing to give away? So what if he says one thing in one place and something else another? Businessmen, some businessmen, do that all the time. That’s why there are so many lawyers.

Likewise people like Buffalo developer Carl Paladino, who spent a lot of money and did everything he could to get a casino in downtown Buffalo. It was a chance for him to make a lot of money and he never gave up his pursuit of it. He bankrolled the campaign to push James Pitts out of the Common Council presidency, getting rid of the one politician in town with the cojones and brains to stand up to this fraud. He bankrolled the lawsuit to keep the Seneca Nation’s Erie county casino from going to Cheektowaga. Paladino made no secret of what he was doing: The spending, so far as we know, is all on the record.

Greed may be unseemly, but it doesn’t rise to villainy. To rise to villainy you must betray a trust, violate an oath, abandon professional principles, things like that. Dante put the greedy in the middle of Hell. He didn’t like them, but they weren’t, for him, close to the worst. For Dante, the worst sinners of all, the most evil of all evildoers, were those who betrayed a trust. Most of Dante’s Hell is hot, but the betrayers of trust are frozen forever in a lake of ice.

The Seneca Gaming Corporation never betrayed your trust or mine. How could they? You and I were never given a voice in any of this. You and I have no relationship with the Seneca Gaming Corporation, nor they with us. This is a deal brokered in Albany by the governor, rubber-stamped by the legislature and made possible by the complicity of elected officials in Buffalo City Hall and the editorial page of the Buffalo News, which has waged a relentless campaign of misinformation and misdirection, exactly as it did in the Peace Bridge war seven years ago.

The real villains

And that betrayal does rise to villainy: the two mayors by the oath they took and the News by any standard of journalistic ethics.

Every time the Buffalo News writes an editorial telling its readers that the casino is a done deal so they should just make the best of it, they are betraying the city of Buffalo. The editorial board of the Buffalo News knows that is not true. They know there are two major lawsuits in progress, one in state court and the other in federal court, either of which could stop this casino for good. They know the mayor and the Common Council could refuse the casino builders the easements they need, making it impossible to run a casino in Buffalo no matter what kind of sleazy deal the governor cut and the legislature went along with in Albany. They know that the legally required environmental impact study examining the potential impact of this casino on the city’s economic and social life has been assiduously avoided by the Seneca Gaming Corporation, the two mayors and the Common Council. The Buffalo News editorial page has, in other words, again and again published things it knew to be untrue and failed to publish things it knew were.

Byron Brown had a wonderful opportunity to undo, or at least subject to intelligent scrutiny, Tony Masiello’s folly. But he didn’t. He wrapped it around his shoulders as if it had been a garment designed just for him. Why would he do that? Why would he not use his first months in office to make sure the city wasn’t being screwed? Why wouldn’t he insist on the EIS he knows we are supposed to have, if only to see what it has to say that might be of use? Why would he just sit in that mayor’s seat and, when a disaster came rolling his way, do just what George Bush did in the White House situation room when he was told the levees wouldn’t hold in New Orleans: nothing. No questions, no defense of the city, nothing.

Perhaps someday we’ll find out. Perhaps someone will speak up or a Freedom of Information Act request will turn up a key document or Byron Brown himself will come clean. All we know for now is, he had the opportunity to do some real good for the city that elected him mayor, and he decided instead to do nothing, nothing at all.

And now, you

Now you know what Barry Snyder, Byron Brown and the Buffalo News editorial board have known all along but never told you. What are you going to do about it?

For starters, you might take the advice of Howard Beale, the TV anchorman in Sidney Lumet’s Network (1976) who is frustrated by the failure of news organizations and politicians to tell the public what they really need to know: “You’ve gotta say, ‘I’m a human being, goddammit! My life has value!’ So, I want you to get up now. I want all of you to get up out of your chairs. I want you to get up right now and go to the window, open it, and stick your head out and yell, ‘I’m as mad as hell, and I’m not going to take this anymore!!’”

Do it. Pick up your phone and tell all those City Hall politicians on your payroll that you’re mad as hell about their failure to protect your city and you’re not going to take it anymore. Write to the Buffalo News and tell them you’re mad as hell about an editorial page that prints things that aren’t true and ignores things that are. You deserve better than that from all of them.

And if you’re not mad as hell? You should be. Because you’re the one who will pay for this folly, whether or not you ever set foot in that windowless casino in the heart of Buffalo.

Bruce Jackson is SUNY Distinguished Professor at UB and vice president of Citizens for Better Buffalo, an organization dedicated to making the process of considering a Buffalo casino open, honest and legal. For more information, visit http://betterbuffalo.com. To respond to this article, e-mail editorial@artvoice.com or write to: Artvoice, 810 Main St., Bflo, NY 14202.