The Seneca Niagara Casino stands tall over the City of Niagara Falls, and it's a looming presence over the city's financial future.

  • City of Niagara Falls facing major cash crunch
  • Stems from ongoing dispute between New York state, Seneca Nation over shared casino money
  • Impasse is now headed to Federal Court

Niagara Falls is facing a budget deficit of nearly $12 million and cash flow could run empty next month — a product of the continued disagreement between New York state and the Seneca Nation of Indians over shared casino revenue.

"By mid to end of July we are going to be in trouble paying our bills. Plan and simple, we're going to be in trouble," said Niagara Falls City Councilman Kenny Tompkins.

Through conversations with the city administration and budget division, Tompkins has major concerns as Niagara Falls faces a serious cash crisis. 

"Your day-to-day budget is your payroll," Tompkins said. "And think of how many people have their livelihoods based on the city. You have all the city workers. You have the union workers. You have the offshoots of it. There will be no money."

For years, the city has relied on payments the Senecas give the state, which are then shared with local municipalities. The Senecas have not made those payments in more than two years, arguing the compact with the state required them to pay only through 2016. Just this week, the Nation asked a federal judge to throw out a recent arbitration panel ruling that the Senecas start paying again. 

All the while, Niagara Falls is stuck in the middle waiting. Last month, Spectrum News told about the fleet of police and other city-owned vehicles that is falling apart with no funds to buy new ones. As of right now, officials say there is no threat to essential emergency services. 

"You have to make up the budget. You have to be able to function your city. You can't just go bankrupt or do something like that," Tompkins said.

Gov. Cuomo has promised the city a $12.3 million advance to help cover expenses while the legal process continues. A spokesman with the administration’s budget division did not offer a timetable for when the city will receive the advance.

“The State is in contact with the Niagara Falls Mayor, and our commitment to the city remains firm as we wait for the Seneca Nation to fulfill its obligation as determined by the arbitration panel," said Freeman Klopott, NYS Division of the Budget press officer.

Niagara Falls Mayor Paul Dyster said in a statement that the actions of the Seneca Nation, "do nothing more than create substantial hardship for the host municipalities, particularly the City of Niagara Falls, and further harm the relationship between the Seneca Nation and the State of New York."

He also added that his office is willing to help broker a deal between the two sides, and that he's been working with the city's budget division to "activate spin up revenues announced last fall, an announcement on details is expected in the coming weeks.”

Tompkins says the time is now for the state to step in to help, and calls on Dyster to further push the Cuomo administration for the advance money.

"We are the crown jewel of New York state. Don't leave us hanging here. There's too many lives at stake here. There's too many people, their livelihoods at stake here. You promised us the money. Give us the money now," Tompkins said. 

Running for re-election on the Republican ticket, Tompkins says he's just as worried about next year's budget. He'd like to see the city add surcharges for parking and tourist attractions like the Maid of the Mist to make up the difference. He says that could add up to millions in revenue for Niagara Falls.