A tribal lawsuit may impact New York Thruway toll revenues

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The Seneca Nation of Indians is fighting New York State in court to demand a cut of toll revenue for a nearly three-mile stretch of road built on tribal land 60 years ago.

A lawsuit filed last Thursday at U.S. District Court in Buffalo charges that the state broke federal laws when it built a 2.7-mile section of the New York State Thruway through tribal territory in southern Erie County. Lawyers for the Senecas are seeking compensation for use of the land and asking that the state stop collecting tolls.

"After decades of seeing our property invaded without authorization from the federal government that is required to protect our native land, we find it necessary to take legal action against these state officials," Seneca Nation president Todd Gates said in a statement. "We are not seeking to cause any disruption, but rather to ensure that the New York State authorities comply with federal law and gain approval from the Department of Interior for the Thruway that encroaches on 300 acres of land that has belonged to the nation and our ancestors for generations."

The lawsuit is latest chapter in a longstanding dispute between the Senecas and New York State dating to 1993 when the tribe openly denied validity of the 1954 easement. The Seneca Nation then asked the New York State Thruway to remit tolls to the tribe, a request that was refused since it claimed the easement was valid. A similar suit was filed in 1999 that was ultimately rejected by a federal court.

“We can’t comment on pending litigation but it’s well established that the Seneca Nation granted an easement for the Thruway in 1954,” New York State Thruway Authority spokeswoman Jennifer Givner said in a statement. “We have defended that position in the past and will continue to do so going forward.”

The NYSTA, which oversees and maintains the 570-mile New York State Thruway system, has sold more than $13.2 billion of debt in the last 10 years, including a $592 million general revenue refunding bond sale on March 1. The agency had $5.4 billion of total bonds outstanding before the transaction, according to Moody’s Investors Service, which revised the outlook on its A2 rating to positive from stable citing a timely Tappan Zee Bridge replacement project. Moody’s also cited the authority’s plans to implement toll increases by 2022 along with positive traffic growth forecasts for the outlook change.

The Seneca Nation is also in the midst of a dispute with the state government State over its share of gambling revenue for three Western New York casinos. The Seneca Nation announced in March 2017 that it would stop remitting casino revenue sharing payments for its casinos in Niagara Falls, Buffalo and Salamanca.

New York State has general obligation bond ratings of Aa1 by Moody’s and AA-plus by S&P Global Ratings, Fitch Ratings and Kroll Bond Rating Agency. The state’s newly enacted $168.3 billion 2019 fiscal year budget closed a $4 billion deficit largely through bank settlement funds and a plan to collect revenue from fees earned by nonprofit health insurance companies.

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Lawsuits Transportation industry New York State Thruway Authority New York