Online graphic See a map that shows gambling operations of the Seneca Nation. Related coverage Indian tribe gaming gains keep growing Indian casinos a long shot here

NIAGARA FALLS, N.Y. -- Frank and Dorothy Giglia of suburban Buffalo visit the Seneca Niagara Casino once or twice a month. They like to play the slots and they're happy to support American Indians instead of "some big national conglomerate," as Frank put it.

John Logan of Swissvale recently made his second trip to the Seneca tribe's other western New York casino, the Seneca Allegany in Salamanca. He and his wife, Louise, rode up for $33 each on a chartered bus with other Western Pennsylvanians.

"I've gambled all my life," said Mr. Logan, 78, a poker and craps player.

The two couples are among the reasons the Seneca Nation is confident about investing $500 million to expand its young gambling empire.

While applicants in Pennsylvania are competing for the right to get slot machines spinning within a year or two, the tribe of 7,400 is building western New York into one of the Northeast's biggest gambling centers. In addition to table games, they operate more than 6,000 slot machines in two locations, and expect to add another 2,400 machines within two years.

Three years after converting the former Niagara Falls convention center into a full-scale casino, the Senecas today will officially open the first 10 floors of a 26-story, 604-room hotel. It will be fully operational by March.

Special guests were given rooms for New Year's Eve celebrations, and Aretha Franklin performs tonight in the hotel's 2,100-seat auditorium. The gleaming glass structure, which is adorned with a 50-foot-tall illuminated feather, is the dominant man-made feature of U.S. side of Niagara Falls, competing for attention and visitors with the much busier Canadian side, which itself has two casinos.

The $235 million hotel project, which has also enlarged the connected casino, is supplemented by a $140 million investment in a more modest hotel and casino in Salamanca, a small town to the south, a little more than a three-hour drive from Pittsburgh.

Built within one of the tribe's two reservation territories in the region, the Seneca Allegany casino-hotel when completed in October will replace a temporary structure that has been luring gamblers from Pennsylvania and Ohio since opening 20 months ago. It's the closest full-scale gambling facility to Pittsburgh.

The Senecas, which took in $337.5 million from gaming in 2004, the last year for which figures are available, are planning a third casino in Downtown Buffalo, between Niagara Falls and Salamanca. It will offer the same array of slots, poker, blackjack, craps and roulette as the others.

In economically depressed Niagara Falls, the Senecas -- historically one of the six nations of the Iroquois Confederacy -- have largely been welcomed as the cornerstone of long-overdue efforts to replicate the tourism success of the town's Ontario neighbor and namesake.

"This is the biggest thing that's happened here in 35 years," Niagara Falls Mayor Vince Anello said of Seneca Niagara on a recent visit to Hush, its new nightclub aimed at young adults. "Now this has given other developers a reason to give us a second look."

The Senecas' Buffalo project is the only one of its efforts that's drawn notable community opposition. The 3,350 casino-funded jobs already in Niagara Falls and the 4,600 jobs projected for Salamanca by year's end make the tribe's operations attractive to those eager to boost the area's economy.

State and local governments are receiving revenue that didn't exist before, $57.1 million in 2004 and a higher, still-undetermined amount for 2005. The tribe and New York state negotiated a 2002 compact in which the Senecas turn over between 18 percent and 25 percent of slots revenue to the state and local governments.

The 1988 federal Indian Gaming Regulatory Act enabled tribes to use gambling as an economic development tool, within limits, depending on laws within each tribe's state. If state political leaders are willing to agree, as New York Gov. George Pataki did, tribes can build Las Vegas-style casinos instead of the small Indian slots and poker parlors common in many Western states.

Local government leaders and Seneca representatives say pro-gambling sentiments in western New York stem in part from the legalized gambling already available minutes away across the Canadian border, muting any arguments that the Senecas would create a new vice. And rather than depending on local players and simply redistributing a fixed amount of disposable income, the casinos in both Niagara Falls and Salamanca are targeting tourists.

Seneca Gaming Corp. officials say about one-third of Salamanca's Seneca Allegany patrons are Pennsylvanians and one-fifth are Ohioans. While the non-local percentage is lower in Niagara Falls, that is expected to increase as a result of the new hotel's opening, which will spark marketing efforts in places as far away as Pittsburgh, a more than four-hour drive.

"The extent to which we relied on local patrons up to now has been by design," said Seneca Gaming spokesman Phil Pantano. "We didn't want to bring people up from longer distances if we didn't have [an overnight] place to put them."

The Senecas have also benefited from their permanent ties to the area. The Senecas have federally protected territory in two separate areas around Salamanca and Irving, which is closer to Buffalo. About 10 percent of casino employees are Indians, Mr. Pantano said.

Indian tribes can bypass the federal, state and local taxes owed by other businesses, which rankles some private businesses competing with them. But with the lack of economic activity in Niagara Falls before the casino, and with local redevelopment funds made possible by the Senecas' revenue-sharing, many entrepreneurs have accepted or embraced their operations, said David Fleck, owner of the Howard Johnson Hotel Closest to the Falls.

Their new hotel, he said, "is gorgeous. They've done a fantastic job." Mr. Fleck, the president of the Niagara Falls Hotel and Motel Association, said he doesn't mind the competition, considering his nightly rates are about half the $100 and up the new hotel will charge to cover its higher-scale amenities.

Barry Snyder, the elected president of the Seneca Nation, said most of the casino profits thus far have been directed toward reducing the debt tied to the expansion projects. But some money has been used to offset cutbacks in federal aid to reservations, subsidize home mortgages for tribe members and support capital improvements to educational and health facilities on the Senecas' land. The tribe is also creating a foundation to combat diabetes, a disease that particularly afflicts Native Americans.

In addition, the 7,400 individuals across America accepted as Senecas (based on their mothers' blood lines), receive quarterly dividends from casino operations. Those have totaled about $8,000 each in windfalls from the three years of gambling expansion, Mr. Snyder said. The gaming took off only after the tribe narrowly approved it in a referendum.

With the gambling growth occurring so close together geographically, in such a short time span, it would seem the Senecas' biggest concern might be over-saturation. John Pasqualoni, hired as Seneca Gaming's president after previous positions in Atlantic City and Connecticut, professes not to be worried.

"We're looking to grow the corporate pie," Mr. Pasqualoni said. "We'll share some, but also pick up additional markets. Allegany has proven that [can happen]."

As for competition from Pennsylvania, with a new racetrack in Erie to offer slot machines, Mr. Pasqualoni insisted the table games, hotels and entertainment venues the Senecas feature will help them retain many customers.

"We're not just a place to roll into and play slots," he asserted. "Will they steal some business from us? Without question, but we're more of a destination resort."