Oneidas' land claims stir resentment in N.Y.; 20,000 landowners may be included in long lawsuit over reservation


VERONA, N.Y. - Five years ago, people in this quiet, rural community gazed with envy and amazement at the instant success of the Oneida Indian Nation's new Turning Stone Casino, an economic juggernaut that created thousands of jobs and lured millions of visitors to this desolate area halfway between Syracuse and Utica.

A few grumbled that it was unfair that the Oneidas did not have to pay taxes on their new wealth. A few others complained that the casino was crowding out small businesses. Yet on balance, most tolerated the incongruously mammoth Oz-like resort here, perhaps rationalizing that the Oneida Indians deserved a leg up after suffering years of poverty and discrimination.

Dispute gets personal

But that was before it got personal.

In December, the Oneidas and the Justice Department announced that they wanted to include 20,000 landowners as defendants in a long-stewing lawsuit to reclaim 270,000 acres from New York state. And almost immediately, the peaceful coexistence was shattered, as landowners flocked to meetings, hinted at violence and snubbed Oneida businesses.

"You'll never catch me buying their gas or going to their casino again," said Rosemary Canaguier, 60, who was combing the golden curls of a longtime customer, Bette Button, at the hair salon Canaguier runs in her house in Canastota. "There's a terrible, terrible dislike now. I don't think you'll ever see the people here ever trusting them again."

There is more, however, to this slide from empathy to enmity than just the fear of losing land that is roughly equivalent to the areas of New York City, Washington and Boston combined.

For many, the land-claim dispute has brought to the surface a latent sense of frustration and jealousy over the phenomenal success of the Oneida Indian Nation, which, like all federally recognized Indian tribes, does not pay taxes. Just like that, it seems, the Oneidas have rocketed from poverty to affluence, from being the have-nots to the haves, while everyone else in a working-class area stocked with grind-it-out dairy farmers has seen income stagnate.

So for many non-Oneidas, watching the Oneidas ask for the most prized of possessions around here land is tantamount to watching the rich squeeze the not-so-rich. And the federal government's decision to side with the Oneidas, many people say, only compounds their outrage.

'Nothing more than greed'

"It smacks of nothing more than greed, and people feel betrayed because we've given them every advantage that every private businessman would die for," said David Wood, an Oneida County legislator. "Not only do we feel threatened, we're offended that our neighbors would do this."

That cocktail of anger and vulnerability figures to intensify in the coming months, residents say. On March 29, Judge Neal McCurn of U.S. District Court in Syracuse is expected to hear arguments on whether to include the landowners in the federal lawsuit. McCurn is also expected to decide soon whether to appoint an arbitrator to do what the Oneidas and New York state officials have failed to do for more than 13 years: hammer out a compromise.

Lawsuit filed in 1970

In 1970, the Oneidas filed a lawsuit in federal court saying that New York state and local governments had illegally acquired Oneida lands in the 1700s and 1800s through illegal and coercive treaties. Fifteen years later, the U.S. Supreme Court upheld the Oneidas' argument.

At that point, the state began to negotiate with the Oneidas. But for years, nothing happened nothing, that is, until December, when the Oneidas and the Justice Department, seeking to pressure the state into a settlement, moved to name the 20,000 landowners as defendants.

"We have to use a tool of discomfort, and that we regret," said Ray Halbritter, nation representative and chief executive of the Oneida Indian Nation.

Halbritter said that the Oneidas did not want to evict anyone. Instead, he said that he would push for a creative solution that would benefit all parties.

The Justice Department has echoed that position. So has the state. In a statement last month, Gov. George Pataki said, "We are going to make sure no one loses their homes, no one loses their property."

So far, though, such assurances have only bred more cynicism and mistrust in the land-claim area of northern Madison and western Oneida counties.

At a forum in Verona, Michael Gaiser, owner of a bed-and-breakfast in Vernon whose business has been severely clipped by the Oneidas' casino hotel, captured the bunkerlike mentality.

"The Justice Department is the one standing there telling us they're going to sue us, and you're telling us that we're not going to be giving up our land," said an exasperated Gaiser, his voice billowing with a timbre reminiscent of Jimmy Stewart. "Well, I don't know if I believe you!"

Gaiser was one of 350 people to attend the meeting, organized by Ralph Eannace Jr., the Oneida County executive. Many belonged to a landowners' group, Upstate Citizens for Equality, which was founded two years ago to challenge the Oneidas' tax-free status but has swelled in recent weeks to 1,000 members because of the land-claim dispute, said its president, Scott Peterman.

Eannace had invited the public to quiz a panel of state and county lawyers involved in the negotiations. But the mood was often testy, as speaker after speaker dismissed the relevance of something that happened 200 years ago, accused local politicians of being beholden to Oneida campaign contributions, and blamed the Oneidas now the area's largest employer, with 3,000 jobs for the souring fortunes of dozens of local businesses.

'Constitution protects us'

Tim Thomas, 51, of Vernon, stoked the passions midway through the three-hour meeting when he told organizers that they had forgotten to recite the Pledge of Allegiance. So everyone stood up, pledged, then applauded vigorously.

"Our Constitution protects us from segregation and discrimination, so that no one person or group can hold sway over any other person in this nation," said Thomas. "And I say to you, that is exactly what is happening here with the issue of taxation with the Indians."

To the Oneidas, though, these complaints about unfair competition and basic rights betray a lack of perspective. For many years, the Oneidas were relegated to a 32-acre parcel dotted by abandoned trailers donated by the federal government. At one point, only a few Oneidas lived on the reservation.

But in recent years, the Oneida Indian Nation, flush with casino cash, has purchased 7,000 acres in the area, opened five gas stations and financed cultural and housing projects for a local Oneida population of 500 that continues to grow, Halbritter said.

The Oneidas do not disclose how much Turning Stone earns, but industry analysts say that the casino, one of the country's most lucrative, generates annual revenues of hundreds of millions of dollars.

That money has helped the area economy as well as the Oneidas, Halbritter said. Since 1996, the Oneidas have contributed about $812,000 to school districts and municipalities. And Zogby International, a Utica-based research firm, recently concluded that the Oneidas' economic muscle had, among other benefits, helped convince Wall Street to upgrade Oneida County's municipal bond rating, saving taxpayers $3.2 million in borrowing costs.

But that has done little to assuage the populist anger, which Halbritter said emerged only after the Oneidas became wealthy.

"Should we take every ethnic group and allocate a certain amount of success so that the blacks don't get too rich, or the Italians, or the Irish, or the Asians?" said Halbritter, who grew up poor in central New York and worked his way through Harvard Law School. "It's the kind of racism that they don't even know is racism."

'The galling thing'

But Peterman of the Upstate Citizens for Equality said the group would do whatever was necessary to defend the landowners' rights. The land-claim dispute, he said, is the last straw with the Oneidas.

"You have a lot of working stiffs that are subsidizing the rich, and the galling thing is that the Indians are rubbing it in our faces," said Peterman, a personable, earnest engineer who before the escalation of the lawsuit had never been active in civic affairs. "If they push this through, I think you're going to see people kill each other."

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