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Smokes cheap, tensions high

SALAMANCA, N.Y.

In a valley that curves along the Allegheny River is a tract of land built on opportunity, greed and the bureaucratic nightmare of being one city in two nations.

According to state and local authorities, Salamanca is the only U.S. city on an Indian reservation.

Toward the end of the 19th century, it was a flourishing railroad town of laborers, families and industrious entrepreneurs, all striving for the American dream.

It was named for a Spanish aristocrat who was convinced by Erie Railroad speculators (with an introduction from a U.S. president) to invest in a rail line to prevent Pennsylvania firms from dominating the raw-materials market.

The only thing standing in the way was Seneca Indian land which, it turned out, could be leased.

A precarious relationship began.

The land the railroad wanted -- basically a swamp -- was then of little use to the Senecas, so agreement was relatively easy.

With the building of the rail line came laborers. With laborers came families. With families came homes and daily necessities such as doctors, lumberyards, barbers, grocers, feed stores. Thus, the city was built.

Acts of Congress in 1875, 1890 and 1990 created a landlord-tenant relationship between the Seneca Nation and Salamanca's homeowners and businesses.

Homeowners and businesses occupied their properties in accordance with a 99-year lease originally granted by the Seneca Nation in 1892. It expired on Feb. 19, 1991 -- and the mutual distrust that had plagued the city since the first railroad was surveyed came to a very public boil.

For reasons ranging from rejecting pricier leases to demanding control over the land, 15 property "owners" eventually were evicted by the Seneca Nation.

Today, shabbiness blankets what could be a quaint river town, a state park and a national forest. Garish "Nation-owned" cigarette outlets and gas stations produce a city drawn by Norman Rockwell but touched up by Jackson Pollock.

"I had a professor who once said, 'Simple way to understand the importance of private property: Have you ever washed a rental car?'" says political science professor Lara Brown. Salamanca, she says, "strikes precisely at the issue. When you don't own, most people don't care."

The discount-cigarette shops attract bargain-seeking smokers from several states. The shops' cheaper prices are due to New York never collecting state sales taxes on reservation lands -- until now.

The other economic chaos here surrounds the Seneca Nation's casino, which juts out of hemlock- and hickory-covered mountains just off Interstate 86.

In August, when the cigarette sales-tax battle heated up between the Seneca Nation and the state, the Senecas began withholding quarter of a billion dollars in casino slots revenue from the state and local governments.

Says Leslie Logan, the Seneca Nation's foreign relations director: "We are withholding the money because the state broke their own promises of gambling exclusivity." She points to slots operations in Hamburg, Batavia and the Finger Lakes region.

Yet the sad story of Salamanca and the Seneca Nation really is the result of many decades' failed policies at a number of levels, on both sides.

For two centuries, federal policy toward Native Americans has been riddled with inconsistencies, reversals and countless broken treaties, all resulting in bitter lawsuits and alienation of all involved.

The federal Bureau of Indian Affairs, created "to assist and protect" Indians, long has been known for mismanagement, corruption and creating dependency, according to U.S. history professor Jeff Brauer.

"It is this unfortunate history that besieges the citizens of Salamanca and the Seneca Nation," he says. "They are now paying for the past mistakes and incompetence of the federal government."

Their plight is compounded by an all-too-familiar pattern in the Northeast: Over several decades, Rust Belt state and local governments have failed to enact job-sustaining tax policies and, more importantly, have failed to invest in infrastructure needed to compete with other regions.

The result, in Salamanca as elsewhere, is sweeping, perhaps irreversible, economic and social devastation.

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