Judge strikes down pact

Michael Gormley

Tuesday, June 29, 2004 | 9:04 a.m.

ALBANY, N.Y. -- The agreement between the state and the Oneida Indian Nation that allowed the billion-dollar Turning Stone Casino to be built a decade ago was ruled invalid Monday by a judge.

Acting Supreme Court Justice James McCarthy ruled from Oswego that then-Gov. Mario Cuomo "exceeded his authority" by entering into the 1993 compact with the Oneida nation without legislative approval.

The state, which lost the decision, declined comment until the state attorney general's office could review the ruling. A spokesman for the winners, the Upstate Citizens for Equality (UCE), had only unlisted telephone numbers and couldn't be reached Monday afternoon.

What effect, if any, the court decision has on the sprawling casino resort in central New York that attracts 4.2 million visitors a year is uncertain. Turning Stone has grown to include a massive casino, three championship golf courses, three luxury hotels, a European spa, a convention center, a cabaret-style showroom and an events arena.

"There really are Herculean impacts," said Leon Koziol from the small Utica law firm that won the case.

He said the decision -- pending any appeal -- provides the state with a huge bargaining chip to end the tribe's claims for traditional lands on 250,000 acres of central New York. The land claim threatens the eviction of 60,000 non-Indians and has long been tied to the casino's development.

If the Oneidas don't negotiate the land claims to the satisfaction of the residents, the court order could be used to seek federal power to shut the casino down, Koziol said. The ruling should also require a new pact that would give a far greater share of profit to the state and local governments, he said.

"It is not our objective to shut down the casino, given the jobs and the economic effect on our area," he said. "But it raises the stakes of the land claims."

Oneida spokesmen weren't available for comment.

State Sen. Nancy Larraine Hoffmann said the court decision should lead to a new compact that allows Indian enterprises to operate profitably while not eroding business or tax base from local governments off Indian land.

"This is the beginning of an important new era," the Onondaga County Republican said.

Another compact -- or agreement -- with the Mohawk tribe met the same legal fate a year ago in a ruling by the state's highest court, the Court of Appeals. Both chambers of the Legislature did not ratify the pact until the state Assembly completed final legislative action earlier this month.

The Oneida case was brought by Scott Peterman and UCE, which was created by central New Yorkers to oppose the Oneidas. The group said the casino has had a negative effect on the non-Indian community, including an erosion of non-Indian business that have trouble competing with the tribe.

Tribal businesses don't collect taxes for sales on Indian land that is sovereign under law, resulting in drastically lower prices for gasoline and other items. UCE argues that violates state law because only Indian consumers should escape taxes.

The suit has continued even as community opposition has become less vocal in recent years. UCE, however, has continued the court challenge to the legality of the Oneidas' gambling compact with the state, arguing that it never was approved by the Legislature as required under federal laws allowing Indian casinos.