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Artvoice Weekly Edition » Issue v5n8 (02/23/2006) » The Casino Chronicles

There Goes the Neighborhood

Plenty of studies show that downtown casinos drain money from the local economy; they take, they don’t give. Indian-owned casinos on sovereign land are even more malign. Who can compete when the casino owners aren’t paying taxes or insurance, when they’re not liable for injuries or accidents, when they’re exempt from costly environmental and health regulations? Restaurants, bars and shops in Indian-owned casinos start out 20 to 30 percent ahead of everyone else. All the studies document what common sense suggests: a downtown, Indian-owned casino in Buffalo will suck the economic breath out of the city.

Nonetheless a few Buffalo businesspeople and several government officials (newly elected mayor Byron Brown among them) still look upon the proposed Seneca downtown casino as development rather than the opposite of development. Do they know some secret thing nobody else does that makes their support of the casino rational? Are they dreamers? Idiots? Have they been bought and sold? Did Governor Pataki frighten or promise them into silence?

We don’t know. All we know for sure is that no one in a position of responsibility in Buffalo city government has taken an unbiased look at this massive antidevelopment project. They’ve done no traffic, economic, environmental or any other kind of studies. UB, Buffalo State and Canisius, all of which will be negatively impacted by the casino, are equally negligent: none of their departments or research institutes have given this huge project any kind of serious examination. Everybody’s running on blind faith.

Buffalo’s former mayor Anthony Masiello and his successor Byron Brown moved Brown’s inauguration up a day so they could go be photographed at the January 1 opening of Seneca Niagara Casino’s new hotel. They grinned for the cameras. A Buffalo casino would take most of its profits from the pockets of local residents, and a Buffalo casino’s hotel, bar, restaurants and stores would take their profits from Buffalo businesses, and all of that money moved from private individuals and business to the Indians would be money totally out of the tax cycle, further impoverishing the city. So what could those two guys have been looking so happy about in Niagara Falls?

If they’d gone outside the casino and talked to some local shopkeepers they’d have had a far more difficult time maintaining the happy-faces.

Since they didn’t talk to the people they really should have been talking to, we asked Artvoice reporter Ken Ilgunas to go up to Niagara Falls and do it for them. Ken asked local businesspeople what Seneca Niagara Casino had done for them or to them. The answers were grim. We begin with Ken’s comments on what he learned, followed by selections from some of his interviews.

Bruce Jackson

Seneca Niagara Casino has been around for three years now and its impact on Niagara Falls restaurants and bars has been devastating. Because the casino permits smoking, serves free alcohol and offers high-grade meals at low rates, local bars and restaurants have been unable to compete.

If the neighborhood pizzeria is still open, odds are that the owners have had to lay off much of its staff. Family-run restaurants that have been open for years have lost their once faithful clientele to the metallic money-magnet in the city’s core.

Staple restaurant John’s Flaming Hearth is going out of business, The Alps has closed and even The Como isn’t putting up the sort of numbers that it’s accustomed to. Corner bars and pizzerias that once gave the neighborhood personality and families the chance to run their own businesses are hanging “Closed” signs on their doors in record numbers.

Other businesses in the area—the bookshops, grocery stores, theaters, etc.—have not suffered as much, but neither have they seen the boost in business that casino proponents promised. In fact, the Seneca Niagara Casino itself sells clothes, jewelry, golf clubs, plasma screen TVs—all priced at rates with which local businesses cannot compete.

Sure, the local economy was in shambles before the Seneca Niagara Casino was erected, but so far it has hindered more than helped struggling businesses. Every shop owner will say that the casino has not made things better, except, as one might expect, the owners of pawnshops, which seem to be thriving. Casino Buy and Sell, a pawnshop on Pine Avenue, accepts jewelry of all sorts.

Crime is on the rise, too—there have been 1,000 more arrests in Niagara Falls compared to last year. This could reflect the continued economic stagnation, partially fostered by the harmful effects of the casino. Captain John DeMarco of the Niagara Falls Police Department credits the high numbers to more troopers in the city under the state-sponsored “Operation IMPACT.” But Operation IMPACT is a meagerly funded program that can hardly account for the steep rise in arrests.

With the Seneca Niagara Casino planning huge renovations and new facilities, family-run businesses that make the city unique could very well become obsolete.

Ken Ilgunas

(photo: jumpthefalls.com)

Rocket’s Pizzeria:

“The casino is doing in the small

businesses in this area.”

Interview with Gina Pasquantino, owner of Rocket’s Pizzeria, 1915 Pine Avenue:

The casino is doing in the small businesses in this area. That’s how I feel. I think once the money goes into the casino it’s not going back out into the community. It’s not coming back out.

My business dropped 38 percent since that casino opened up. People thought it would help. All it did was relocate our jobs. I used to employ 17 people, seven of them full-time. I employ two part-time people now. Since the casino opened, I had to open up one more day to try to make ends meet. I give myself a couple more years and I won’t be here.

Every year I have to pay $7,200 in taxes to open up my door. They don’t. That’s a big nut. When you sell a pizza for $10, how far are you going to go? I think everybody’s suffering in this area. Pine Avenue is going to be a ghost town.

Atlantic City is a prime example of that. Atlantic City had 96 restaurants; they’re down to 32 outside the Boardwalk. You get off the boardwalk in Atlantic City and you’re in the slums. This is going to be the slum. I think Governor Pataki sold us out. Governor Pataki really sold the small business people out…

Are they giving us a tax break? No. Not the business owners, not the homeowners, nobody. It’s not right. Atlantic City, Vegas, they get decreased in taxes. Ours are increased. It just doesn’t make sense. That’s our governor. I wouldn’t vote for Pataki when it’s time to vote.

Niagara Falls is made up of retired individuals, unemployed individuals and then your working staff. There’s no money. The only ones with money in Niagara Falls are your retirees. All of us were just surviving.

When I retire, I’m not going to be getting that money they got. There’s no new money out there. If I want to continue living in a nice place, guess what? I can’t do it here. If I leave this building, I’m done. I can’t go work for minimum wage.

What did [Pataki] take from the Senecas underneath the table? You tell me there was no crooked shit going on? I’m sorry, I don’t believe that.

Kelly’s Corner:

“Fight it. Fight it so hard.”

Interview with Kathy Lewis, owner of Kelly’s Corner, 524 Cayuga Drive:

I’ve been in this business for 15 years and my husband and I owned it for five. Between the casino and the New York State non-smoking law, we have lost 80 percent of our bar business. I’m not going 30 percent, I’m not going 50 percent, I’m going 80 percent.

These chairs were all full at eight o’clock in the morning and now I’m out of luck. We went from a $300 to $400 a shift to $38, $50, and you’re still paying a bartender. It zapped us. It put us in bad financial straits. We had just purchased the place when it all took place. We owned the place for three months. The smoking ban hit, the casino opened, sales tax got raised and my husband had open-heart surgery. What next?

We’ve been struggling and it’s been very hard to pay the bills. Brand new mortgage—$200,000 mortgage at 15 percent because no one will take a risk on commercial property.

They don’t give us any breaks. They don’t cut any slack for the poor businesses. But yeah, they give out the land to put up a casino. That doesn’t benefit the small businesses at all. It employs 2,000 people; thank god it employs people, because if it didn’t employ people in our area I would really be against it. It’s not their fault. It’s not even the casino’s fault. Whose fault is it? It’s New York State’s fault. It should have been a New York State owned casino so that everyone benefits.

The Indians are very smart. They’re doing a good job. They put a diamond in the middle of a war zone. We should be embarrassed for our Main Street. I drove down our Main Street and I was embarrassed. To think that people are coming to our casino and seeing Main Street.

The city planners and all that money could benefit us, but the deal they made isn’t benefiting anyone around us. And they’re lying to us. We should be getting a break on electric. We should be getting a break on everything. We’re Western New York—where all our natural resources are from. I could walk to the power plant but yet I get shut down for not paying my bill because I’m commercial property.

Twenty-two bars have closed in this area in the last year. Six of them in the last month. You do some research and you’ll see. I could name them. They’re my friends and it breaks my heart.

It’s made me the kind of person that I don’t want to be because I’m on edge all the time, and paying for your bills is a hard thing to do. I’m 59 years old and I shouldn’t have to be worried about this stuff. This is a beautiful little bar; this place here has given me so much joy. I’m the cook, I’m the bartender. I had to lay off all my people. I have one person working that’s not a relative, and I can’t [lay her off] because she’s 61. I just can’t do it to her. It’s coming to a point where I might have to. But I have my daughter, my son, my brother-in-law and myself. We’re doing it because they take no pay. And that’s the only way we can do it.

If they do it Buffalo…I was born in Buffalo, I love Buffalo, I go downtown, I look at those buildings, I think Buffalo is beautiful. I may be one of the only people in the world that thinks that, but when you look at that Liberty Building and you look at Buffalo...

If they do it to Buffalo, those small businesses don’t have a chance. They don’t have a chance. They’re struggling now as it is. Why would you leave that casino? You’re not going to leave that casino and come to my bar for a fish fry. Why would you? They make it so pleasant in there. You got lounges, you got everything.

You think they would have learned from Atlantic City. What did it do to that place? The casinos are doing okay but the surrounding areas aren’t.

People are human and they think that the casino is fun—and I don’t feel that it isn’t. But the locals can’t afford it. Half of them aren’t working. They can’t afford to be there. I know people who have lost their houses and everything. I know a kid that used to be here all the time that’s into them. He lost everything he had. They get free liquor, they can smoke. But it’s not free liquor. They pay dearly for that free beer.

No one’s going to benefit. There isn’t going to be anymore “mom and pops.” We’re losing jobs left and right. How many more jobs are we going to lose?

I think it was a bad move and I think it will destroy Buffalo. But I’m talking through experience and I probably won’t be here next year. If things don’t get better, we’ll be gone too.

John’s Flaming Hearth, The Alps—these are historical places too. You’re losing places that have been in business forever. The casino will affect Buffalo the same way. [The Seneca casino has] a great facility for conventions, great facility for banquets, for business meetings. So does the Como, so does Antonio’s, so did John’s Flaming Hearth, so did the Alps. When your city planners promote this business to the casino and not to places like Salvatore’s—that hurts when you don’t take care of your own first. The casino will make money, but throw a bone to the people around you so that you have a city.

I think if a casino comes to Buffalo, I just think the poor people around it will suffer. How much of Buffalo is on welfare? How much? They’re all going to look for that pie in the sky and they’re all going to be there. And they’re going to be worse off.

(photo: jumpthefalls.com)

When you make an investment like this, so late in your lifetime and you’re watching it gradually disappear with no control and it’s nothing you’re doing wrong, you’re mad. You are mad. And when I have to put a closed sign on this building I’m going to be mad, and I’m going to be hurt and I’m going to be bitter. The same thing is going to happen to Buffalo. They are going to be the victims whether they want to or not. Because there’s nothing we bars can offer that’s better. We can’t bring in the big bands. We have to pay for a big band. If I pay $300 for a band, then I’m broke. We can’t draw like they draw. There’s no way. Free concert to the Beach Boys? I can give you free hot dogs but I can’t give you a free concert from the Beach Boys. I can give you a $2 beer, I can give you a homecooked meal for less than $5, but I can’t give you all the things that they give you.

Fight it. Fight it so hard. Don’t fight for a casino. Don’t hope that comes in. Fight it. If I was a small business around there, I’d be scared to death.

I don’t care what politician is in office, I don’t care what they say, it isn’t going to work. There’s too much greed, and they won’t put the money in the right places. It’s going to be bad.

Club Joey’s:

“These tourists, they never leave the casino.”

Interview with John Diletti, owner of Club Joey’s, 1532 Pine Avenue:

For a little guy like me, it hasn’t been a picnic. I haven’t seen the development that they promised; that has yet to come and it’s been three years.

According to a vendor, in 2005 we lost 20 bars in the city. It’s the worst year he’s had and he’s been in business for over 40 years. In the other years when one business closed, someone moved in and took over. Now, anyone that’s planning to move into town has got to have his head examined.

My problem is with the uneven playing ground. I’m a one-legged man in a kicking contest with my hands tied behind my back. It’s un-American and it’s not free enterprise. How can it be free enterprise when everyone surrounding me has advantages? They’re allowed to smoke in the Canadian and Indian casinos. Bars close at the casino and in Erie County at 4:00 a.m.; they close at 2:00 a.m. in Niagara County. Canadians two minutes away can sell liquor to 19-year-olds.

With a casino, you’re inviting unfair competition into the city. And unless Buffalo restaurants, bars and other businesses want similar results, I would think that they would think twice about a casino.

Overall, between the casino, the smoking ban, DWIs and economic conditions, my business has been affected 30 to 40 percent. It’s not just the casino, but I do know that my late business has suffered. I go over to the casino after closing and I see my own customers. The casino buffet has hurt me too. It’s had an effect on my dinner crowd.

These tourists, they never leave the casino. They come into town, go into the casino, gamble, eat, drink, browse casino shops and go home.

The Como:

“It seems to be hurting everyone”

Interview with Dominic Colucci, owner of The Como, 2220 Pine Avenue:

It seems to be hurting everyone. Initially, as far as the restaurant is concerned, they’ve opened up restaurants and banqueting facilities inside their area, so that’s going to take away from instant business.

But on the whole, if local people go there—and I’m not just talking about the restaurants, I’m talking about the gaming facilities—and go and spend $300, $400, $500, they might lose. Obviously that’s less money that they would have to spend somewhere else. So it’s not just the restaurants taking restaurant business. It’s the casino taking restaurant business and everyone else’s business. Blow $500 and you’re not going to get new tires for the car, you might not buy a new winter coat, you might not go to a restaurant. It’s not just restaurants that they’re affecting.

What is hopefully going to happen for the long run is that it will stimulate or motivate some developing around it. Not only their own development but I’m talking about getting developers that come in and build up Niagara Falls similar to the way Canada has done it. Now the only difference is that it is not a level playing field because it’s an Indian concern. When you’re talking Senecas and other Indian tribes, they don’t pay any taxes. So that’s one unfair advantage. Everyone else around them has to pay taxes. That creates an un-level playing field.

Number two, you can smoke at the casino. You can’t smoke anywhere else outside the casino in restaurants or bars. And that creates an un-level playing field for us. So those factors are what’s happening now. But as I say, locally it’s hurting a little bit, but hopefully in the long run it will create something that we haven’t had in a while. Hopefully it’s going to be a positive.

[For my business] it hasn’t been too bad. I want to say somewhere around seven or eight percent. But if you talk to some bars, they’ve croaked. I mean us, we’ve been established since 1927, so hopefully we’re going to be here another 80 years. It’s hurt us slightly, but it has hurt the overall economy in Niagara Falls. There are positives—they’ve created a lot of nice jobs. There are positives.

I’m sure [the Senecas have] donated a lot of things to help areas around them. I can’t speak for that because I don’t know. But what the problem is—it’s not so much their fault—but we haven’t received the casino dollars. According to records, the casino has paid their so-called amounts to the state. Now we just can’t seem to get it from our governor or our state to come back to us. So that’s a problem. We’ve expected anywhere from $10 million to $12 million a year. They were supposed to make a certain percentage of payment to the host municipality for the slot revenues.

We haven’t seen that. We saw it the first year, we haven’t seen any since. I don’t blame the Senecas; I blame our own state and our governor. So as far as helping the community, if we started getting that money, that would help us.

Quality Hotels and Suites:

The crime rate has increased”

Interview with Roshan Jainudeen, assistant general manager of Quality Hotels and Suites, 240 Rainbow Boulevard:

Since the casino opened we gained a lot of rooms. The casino clients, they stayed with us. We had an agreement with the casino to accommodate with a special rate and people came and stayed with us. Since December of last year, the 31st, we don’t have the contract with them anymore. We don’t have anything to do with them. However, we still have a few people who like our hotel and they come and stay with us.

Relatively, the business is down. Obviously because the rooms that we were supposed to get from the casino are no longer with us. I will say we’re down a good 20 percent from what we used to have. We expected that. We are trying to gain ground by giving special packages.

The crime rate has increased. We never had any holdups at the desk before, but we recently had a holdup. That and a lot of vandalisms and car break-ins. We never had that before. There’s a lot of cars that are being broken into.

Billy Dick:

“Even the girls are getting better”

Interview with Billy Dick, a resident of Niagara Falls for 43 years. The interview took place at Players Bar, 328 Niagara Street:

The casino ain’t hurtin’ the city. If it’s doing anything, it’s making it better. It’s cleaning up all the neighborhoods. They were all hurting a long time ago.

We’ve been getting more work in construction since the casino opened. Even the girls are getting better.

Bruce Jackson is SUNY Distinguished Professor and Samuel P. Capen Professor of American Culture at UB. He edits the web journal BuffaloReport.com and is a member of the Citizens for a Better Buffalo steering committee. For more of his articles on the Buffalo casino, as well as links to other reports and documents, visit http://buffaloreport.com/casinochronicles.html.