Scott v. City of Buffalo

Full title: PASTOR KEITH H. SCOTT, SR., DORA RICHARDSON, JOSEPHINE RUSH, JOHN and…

Court: Supreme Court of the State of New York, Erie County

Date published: Jul 3, 2008

2008 N.Y. Slip Op. 51738 (N.Y. Sup. Ct. 2008)

Opinion

2006-1189.

Decided July 3, 2008.

THE KNOER GROUP, PLLC, Robert E. Knoer, Esq., of Counsel, Richard E. Stanton, Esq., of Counsel, Buffalo.

RICHARD LIPPES AND ASSOCIATES, Richard J. Lippes, Esq., of Counsel, Buffalo, New York.

JACKSON JACKSON, Michael Lee Jackson, Esq., of Counsel, Rachel E. Jackson, Esq., of Counsel, Buffalo, New York, New York, for Petitioners.

PHILLIPS LYTLE LLP, Adam S. Walters, Esq., of Counsel, Buffalo, New York, for Respondents.

JOSEPH G. MAKOWSKI, J.

PRELIMINARY STATEMENT

This Article 78 action involves a challenge to the segmented environmental impact review conducted by the City of Buffalo Common Council (hereinafter referred to as the "Common Council") pursuant to the State Environmental Quality Review Act (hereinafter referred to as "SEQR") and the City of Buffalo's SEQR Review Ordinance (hereinafter referred to as "CERO") and approval of a certain agreement entered into between the City of Buffalo (hereinafter referred to as the "City") and the Seneca Nation of Indians (hereinafter referred to as the "Seneca Nation") (hereinafter referred to as the "Agreement"). Under the terms of the Agreement, the City abandoned and sold a portion of Fulton Street to the Seneca Nation for $631,000 and other recited consideration including assurances relative to the construction and operation of a Type III gaming casino at their Buffalo Creek site in the City.

On November 9, 2006, this Court issued a Memorandum Decision and Order (hereinafter referred to as the "November 9 Order") denying Petitioners' Motion for Injunctive Relief. Petitioners appealed the November 9 Order which was affirmed by the Appellate Division, Fourth Department on March 16, 2007, for the reasons recited by the Court. Petitioners subsequently amended their Petition to include an additional party and claims.

Oral argument on the merits of Petitioners' Second Amended Petition was held on July 27, 2007, at which time the Court asked for supplemental briefing on certain discreet issues involving necessary parties, law of the case and the content of the Record. By Memorandum Decision and Order dated June 27, 2008, this Court denied Petitioners' motion concerning the supplementation of the Record filed by Respondents in this special proceeding.

PROCEDURAL HISTORY

Petitioners commenced this action with the filing of a Notice of Verified Petition and Verified Petition on January 31, 2006. The original named Respondents in the Verified Petition were Governor George E. Pataki, the State Gaming Officials of the New York Wagering Board (collectively referred to as "State Respondents"), the City of Buffalo, the City of Buffalo Common Council, former Mayor Anthony Masiello, Mayor Byron Brown, the City of Buffalo Department of Public Works, the Buffalo Sewer Authority (collectively referred to as the "City Respondents") and the Niagara Frontier Transportation Authority (hereinafter referred to as "NFTA").

On October 26, 2006, this Court issued an Order to Show Cause as to why Petitioners should not be granted a Preliminary Injunction enjoining the City Respondents from: (1) taking any actions towards approval or acting upon a proposed Agreement between the City and the Seneca Nation for the sale of Fulton Street; (2) enjoining City Respondents from taking any steps toward the transfer of Fulton Street and/or any rights pertinent thereto or easements, authority permissions to the Seneca Nation and/or any other body or party until such time as this Article 78 proceeding before the Court is resolved; and (3) compelling City Respondents to undertake an environmental review, included but not limited to, preparation of a complete environmental assessment form, preparation of a draft environmental impact statement (hereinafter referred to as "EIS") followed by an appropriate public comment, and issuance of a final EIS prior to making any findings with regard to the Agreement and/or transfer of Fulton Street.

On November 6, 2006, this Court heard oral argument on Petitioners' Motion for Preliminary Injunction. On November 9, 2006, this Court issued a forty-five (45) page Memorandum Decision and Order which denied Petitioners' Motion for a Preliminary Injunction finding that: (i) "Petitioners cannot demonstrate a likelihood of success on the merits"; (ii) "Petitioners have failed to demonstrate that they will suffer immediate and irreparable injury as a result of the sale of Fulton Street by the City to the Nation . . ."; and (iii) "the equities weigh in favor of Respondents and the Preliminary Injunction must be denied." This Court concluded that Petitioners did not meet any of the criteria necessary to obtain injunctive relief.

On November 10, 2006, the Petitioners filed an Order to Show Cause with the Appellate Division, Fourth Judicial Department (hereinafter referred to as the "Fourth Department") seeking a Temporary Restraining Order and expediting an Appeal of the November 9 Order. On November 14, 2006, the Fourth Department denied the Order to Show Cause. On November 15, 2006, Petitioners then moved again for an expedited Appeal and injunctive relief. On November 28, 2006, the Fourth Department entered an Order denying Petitioners' applications.

Petitioners, by Notice of Motion dated December 14, 2006, made application to the Fourth Department to hear their motions for an order granting an expedited Appeal and for a Preliminary Injunction pending a determination of Petitioners' Appeal. By Order entered January 10, 2007, the Fourth Department granted the Motion for an Expedited Appeal, but once again, denied Petitioners' Motion for a Preliminary Injunction.

Argument on Petitions' Appeal was heard in the Fourth Department on February 22, 2007. On March 16, 2007, the Fourth Department unanimously affirmed this Court's November 9 Order "for reasons stated in decision at Supreme Court."

Subsequently, Petitioners served an Amended Verified Petition dropping all claims against the State Respondents and the NFTA, but maintaining its claims against the City Respondents. The Petitioners sought an order directing the City Respondents to fully comply with SEQR and CERO and prepare an EIS concerning the Type III gaming casino. City Respondents then moved to dismiss the Amended Verified Petition, which was denied by this Court in a Memorandum Decision and Order of February 8, 2007.

On April 2, 2007, pursuant to an Order on Stipulation, Petitioners amended their Petition to explicitly include challenges to the approval of the Agreement by the Common Council on October 31, 2006. Several of Petitioners' arguments in the Second Amended Verified Petition are virtually identical to the arguments previously made relative to their Motion for a Preliminary Injunction, with the exception that the Petitioners have added the Buffalo Water Board as a Respondent (hereinafter all Respondents in the Second Amended Verified Petition are referred to as "Respondents"), and have added claims with respect to Respondents providing the Seneca Nation with sewer, water and emergency services on the current casino site. Petitioners' claims and requested relief are summarized in paragraphs 135 — 138 of the Amended Second Petition.

This Court's November 9 Order, which was unanimously affirmed by the Fourth Department, has in essence, already rejected many of Petitioners' current claims within the context of denial of injunctive relief. However, the November 9 Order was issued in the context of a motion for injunctive relief. Therefore, it is necessary for this Court to address the merits of Petitioners' claims in the Second Amended Petition. For all of the reasons recited below, the Court dismisses the Second Amended Petition as a matter of law and grants judgment to Respondents.

STATEMENT OF FACTS

On or about December 8, 2005, the Seneca Nation commenced construction of a Type III gaming casino on the Buffalo Creek Territory (hereinafter referred to as the "Casino"). (Affidavit of Alisa A. Lukasiewicz, Esq., dated October 30, 2006 (hereinafter referred to as the "LUK 10/30/06 Affidavit") at paragraph 5). The Seneca Nation is a sovereign Indian Nation and are authorized to construct and operate the Casino pursuant to the Indian Gaming Regulatory Act of 1988 and the Nation State Gaming Compact executed between the State of New York and the Seneca Nation on or about August 18, 2002 (hereinafter referred to as the "Compact"). ( Id. at paragraphs 3 — 4; LUK000002) The City does not have the ability or the authority to prevent the construction of the Casino. ( Id. at paragraph 6)

In April 2006, the Seneca Nation formally asked the City to abandon Fulton Street and to sell it to them ( Id. at paragraph 7). The City began discussions with the Seneca Nation about the possible abandonment and sale of Fulton Street ( Id. at paragraph 8). From the City's perspective, because it has no authority to regulate activities on the Buffalo Creek Territory, and in particular, any activities associated with the operation of the Casino, the City's negotiation team, led by Mayor Byron Brown, viewed the negotiations as an opportunity to get certain commitments from the Seneca Nation that neither the Compact nor Federal Indian Gaming Law require.

The Common Council's environmental review process for the abandonment and sale of Fulton Street began in July 2006 when the Seneca Nation provided the City with a full Environmental Assessment Form (hereinafter referred to as "EAF"), supplemental information about the Casino, a cultural resources report, a utility impacts report and a site conditions report. (LUK000108 — 202) While this environmental review was ongoing, the City, through Mayor Byron Brown, developed the Agreement with the Seneca Nation which embodied certain assurances for the citizens of Western New York relative to the Seneca Nation's operation of the Casino on the Buffalo Creek Territory. (LUK10/30/06 Affidavit, paragraph 9) Specifically, the Agreement provides that the City will abandon and sell Fulton Street to the Senecas and will provide sewer, water and emergency services to the Buffalo Creek Territory (LUK001533 — 1538). In exchange, the Agreement provides the Seneca Nation will take certain actions, including: (i) spending between $5 million to $7 million making infrastructure improvements to City-owned lands around the Buffalo Creek Territory; (ii) integration of Type III gaming casino structure with the surrounding community and building an urban park; (iii) employment of approximately one thousand (1,000) people at the Casino and the grant of a preference to City residents for fifty percent (50%) of jobs and the recruitment in high unemployment areas; (iv) abiding by a policy of trying to have a work force of at least twenty-five percent (25%) minorities and at least eight percent (8%) women; (v) market the Casino beyond the Western New York region; and (vi) pledges not to acquire additional property for Casino operations (LUK001834 — 1862).

The negotiation process for the Agreement was extremely challenging and negotiations broke off at several instances. (LUK 10/30/06 Affidavit, paragraph 9) However, the City and the Seneca Nation were finally able to complete negotiation of an agreement for the sale of Fulton Street.

On or about October 12, 2006, Mayor Byron Brown submitted a copy of the Agreement to the Common Council for its consideration. (LUK000456 — 458) On that same day, the Seneca Nation provided the City with updated and revised environmental documentation analyzing all of the potential adverse environmental impacts associated with all of the City actions as recited in the Agreement. (LUK000489 — 543) This documentation included a revised EAF, expanded environmental analysis and information, a geotechnical evaluation report for the project area, an updated utility impact report, an updated cultural resources analysis, a traffic impact study and an environmental conditions review of the project area.

The Common Council promptly provided the updated and revised environmental documentation to all of the interested and involved agencies, including the City of Buffalo Planning Board, the County of Erie Department of Environmental Planning, the City of Buffalo Appraisal Review Board, the Buffalo Sewer Authority, the New York State Thruway Authority, the Buffalo Fiscal Stability Authority, the New York State Department of Transportation — Region 5, and the Department of Public Works. (LUK000761 — 778) Several of these agencies responded back to the Common Council with comments, including the City of Buffalo Planning Board and the Department of Public Works. (LUK00817 — 820) For instance, the Department of Public Works informed the Common Council that it had reviewed the traffic study and believed that it adequately addressed the impacts of abandoning and closing Fulton Street (LUK000820).The Common Council held a Special Council Work Session on Wednesday, October 25, 2006, to review and consider the updated and revised environmental documentation. (Affidavit of Alisa A. Lukasiewicz, Esq., dated November 2, 2006 (hereinafter referred to as the "LUK 11/2/06 Affidavit") at paragraph 6). The special work session was attended by representatives of the Department of Public Works, the planning staff of the Office of Strategic Planning, Council staff and legal representatives. In addition, the Seneca Nation's environmental consultants, including the Seneca Nation's traffic engineers, were also present. There was extensive discussion and review of the environmental documentation between the Common Council and other attendees, particularly about the traffic study and whether the roadway and traffic handling improvements required pursuant to the Agreement would sufficiently mitigate adverse traffic impacts associated with the Casino.

The next day, the Common Council held a public hearing on the proposed abandonment and sale of Fulton Street to the Seneca Nation. The hearing was well attended. The Petitioners and their counsel were present and testified extensively in opposition to the Casino and the Agreement. ( Id. at paragraphs 7 — 12.)

The day before making its determination of significance, the Common Council held a caucus meeting and the Petitioners' supporters and their counsel were in attendance. The Council gave Petitioners' supporters an opportunity to speak to the Casino and the Agreement. Once again, Petitioners' supporters objected to the Agreement and urged the Common Council to "fight the casino" on environmental and other grounds. At this meeting, the Common Council also reviewed additional environmental documentation which the Seneca Nation had provided in response to planning staff comments. ( Id. at paragraphs 14 — 18.)

On Tuesday, October 31, 2006, the Common Council, by a vote of six to three, adopted a resolution titled "Determination of Significance Pursuant to the State Environmental Quality Review Act for the Abandonment and Sale of Fulton Street and the Proposed Agreement Between the City of Buffalo and the Seneca Gaming Corporation, the Seneca Erie Gaming Corporation and the Seneca Nation of Indians." (Id. at paragraph 3, LUK000001 — 11) The resolution was supported by extensive documentation (LUK000012 — 1833) and made detailed and explicit findings with regard to segmentation. (LUK000006 — 7)

The record shows that the Common Council examined the circumstances surrounding both the Seneca Nation's Casino project and the Agreement and, after careful and reasoned analysis, determined that the environmental review for the Agreement could properly be segmented from the Casino. (LUK00001-011) As a first step, the Common Council evaluated whether the Agreement and the Casino were sufficiently related based on the NYSDEC factors to warrant a single comprehensive environmental review. The Common Council found that the Agreement and the Casino were sufficiently related such that SEQR would usually require the two (2) projects to be addressed in a single environmental review.

Having made this determination, the Common Council next considered whether segmentation would be appropriate under the circumstances surrounding the Agreement and the Casino. The Common Council determined that segmentation was appropriate under the circumstances because the Common Council had no authority over the construction and operation of the Casino. As explained by the Common Council, while the City could undertake a study to assess environmental impacts associated with the construction and operation of the Casino, the City could not require the Seneca Nation to mitigate potential adverse environmental impacts relative to the Casino, nor could it require the Seneca Nation to consider reasonable alternatives.

The Common Council also evaluated whether segmenting the environmental review for the Agreement from the Seneca Nation's Casino project would be no less protective of the environment. The Common Council provided a detailed explanation of a number of reasons why performing a segmented review for the Agreement was no less protective of the environment. Among the Common Council's reasons were: (i) the Agreement would eliminate or mitigate adverse environmental impacts associated with the Casino; (ii) through the Agreement, the City had maximized the mitigation it could get from the Seneca Nation relative to the Casino; (iii) an environmental review of the Casino by the City would serve no useful purpose under SEQR because of the City's inability to force the Senecas to mitigate adverse environmental impacts.

Overall, the Common Council received extensive environmental information regarding the potential impacts associated with the Agreement; held numerous meetings to discuss the environmental information; received extensive input from other interested and involved agencies, the public, and various environmental experts, and ultimately, issued a Determination of Significance setting forth twenty (20) reasons supporting its Negative Declaration for the Agreement and citing more than fifty-seven (57) documents which the Common Council considered and relied upon, including reports by environmental experts. (LUK00001 — 11) Specifically, the Common Council analyzed the potential impact to water resources, the City's water and sewer system, vegetation and wildlife, aesthetics, cultural resources, open space and/or conservation areas, recreation, parkland and scenic views, traffic impact, energy usage, public health and safety and community resources and services. (LUK000005 — 8) In addition, the Common Council considered the consistency of the Agreement with the City of Buffalo's comprehensive plan. (LUK000008) Following the adoption of the Negative Declaration pursuant to SEQR, the Common Council adopted a resolution approving the Agreement with the Seneca Nation. (LUK 11/2/06 Affidavit, paragraph 20; LUK001533 — 1538)

On October 26, 2006, the Court issued an Order to Show Cause as to why Petitioners should not be granted a Preliminary Injunction enjoining the Respondents from (1) taking any actions towards approval or acting upon the proposed agreement for the sale of Fulton Street Right Of Way (hereinafter referred to as "ROW") between the City of Buffalo and the Nation, Seneca Gaming Corporation, Seneca Erie Gaming Corporation; (2) enjoining Respondents from taking any steps toward the transfer of that property commonly known as Fulton Street between Michigan Avenue and Marvin Street and/or any rights pertinent thereto or easements, authority, permissions to the Seneca Nation, Seneca Gaming Corporation, Seneca Erie Gaming Corporation and/or any other body or party until such time as this Article 78 proceeding before the Court is resolved; and (3) compelling Respondents to undertake an appropriate environmental review, included but not limited to, preparation of a complete environmental assessment form, preparation of a draft environmental impact statement followed by an appropriate public common, an issuance of a final environmental impact statement prior to making any findings with regard to the proposed agreement and/or transfer of said Fulton Street ROW.

On November 6, 2006, the Court heard oral argument on Petitioners' Motion for Preliminary Injunction. Following oral argument, the Court reserved decision. On November 9, 2006, the Court issued a forty-five (45) page Memorandum Decision and Order denying Petitioners' application for a preliminary injunction. On March 16, 2007, the Fourth Department affirmed the Court's decision denying Petitioners' Motion for Injunctive Relief. Subsequent to the Court's November 9 determination, the City completed the sale of Fulton Street by deeding the property to the Seneca Nation for the consideration recited in the Agreement approved by the Common Council.

Pursuant to the terms of the Agreement, the City subsequently issued various permits to the Seneca Nation, including water and sewer permits. See, Affidavit of Alisa A. Lukasiewicz, Esq., Affidavit dated May 31, 2007. The City subsequently began to provide water, sewer and emergency services to the Seneca Nation on its land which serves as the site of the Casino.

On or about July 4, 2007, the Seneca Nation opened and still currently operates a casino on its site in the City. (Affidavit of Adam S. Walters, Esq. dated August 31, 2007) Since opening the temporary casino building on the Buffalo Creek Territory site, the Seneca Nation has commenced construction of a permanent casino facility on the site.

JUDICIAL STANDARD OF REVIEW

The standard of review of the Court of the actions taken by the Common Council in issuance of a negative declaration segmented as to Fulton Street ROW is limited. In Chinese Staff and Workers Ass'n v. City of New York, 68 NY2d 359, 363 (1986), the Court recited:

In reviewing administrative proceedings in general and SEQRA determinations in particular, we are limited to considering whether a determination is made in violation of lawful procedure, was affected by an error of law or was arbitrary and capricious or an abuse of discretion' (CPLR § 7803(3)) as we stated in Matter of Jackson v. New York State Urban Development Corp., 67 NY2d 400, 416, it is not the role of the courts to waive the desirability of any action or choose among alternatives, but to assure the agency itself has satisfied SEQRA, procedurally and substantively.'

SEQR provides that no state or local governmental agency may undertake, fund or approve an action unless and until that agency has performed an adequate environmental review consisting of an evaluation of the nature, type, size and scope of the action and an assessment of whether the action has the potential to have a significant environmental impact. NYECL §§ 8-0109, et. seq. (McKinney 2003); 6 NYCRR § 617 (2003). The purpose of SEQR is plain: to require agencies to incorporate environmental considerations directly to their decision making and, where necessary, to modify that action to mitigate adverse environmental effects. Matter of Coca-Cola Bottling Co. v. Bd. of Estimate, 72 NY2d 674, 679 (1988); Billerbeck v. Brady, 224 AD2d 937, 938 (4th Dept. 1996).

SEQR itself does not set forth the standard courts are to apply in reviewing an agency's substantive SEQR compliance. Nevertheless, over the years, the Court of Appeals has articulated a consistent set of standards for judicial review of an agency's substantive SEQR obligations:

[W]e do not decide here whether an EIS is required prior to the construction [of the project] or what environmental impacts may flow from that construction. The limited issue presented for our review is whether respondents identified the relevant areas of environmental concern, took a "hard look" at them, and made a reasoned elaboration of the basis for their determination.

Chinese Staff and Workers Association v. City of New York, 68 NY2d 359, 363 (1986); see also , Jackson v. New York State Urban Development Corp., 67 NY2d 400, 416 (1986) (Courts must determine whether a SEQRA determination was made in violation of lawful procedure, was affected by an error of law, or was arbitrary and capricious or an abuse of discretion).

In reviewing a lead agency's compliance with SEQR, a court does not weigh the desirability of the action or determine what, if any, adverse environmental effects may result from it. The limited issue for judicial review is whether the decision makers identified the relevant areas of environmental concern, took a "hard look" at them, and made a reasoned elaboration of the basis for their determination. Id.

The Court of Appeals also has cautioned courts from acting as a super-legislature in overruling the discretion of agencies:

While judicial review must be meaningful, the courts may not substitute their judgment for that of the agency, for it is not their role to weigh the desirability of any action or [to] choose among alternatives. Since it is not the court's role to evaluate de novo the date presented to the agency, the court must, as with substantive SEQRA obligations generally, be guided by the rule of reason and refrain from substituting its judgment for that of the agency.

Akpan v. Koch, 75 NY2d 561, 570 (1990)

A court's review of the administrative action in a SEQR case is limited to the record made before the agency. City of Saratoga Springs v. Zoning Bd. of Appeals of the Town of Wilton, 279 AD2d 756, 760 (3rd Dept. 2001). Not every conceivable environmental impact mitigating measure, or alternative need be addressed in order to meet an agency's responsibility under SEQR; the degree of detail and the reasonableness of the agency's action will depend largely on the circumstances surrounding the action. Nevill v. Koch, 79 NY2d 416, 424 (1992); Har Enterprises, 74 NY2d at 549. A negative declaration is properly issued when the agency has made a thorough investigation of the problems involved and reasonably exercised its discretion. Spitzer v. Farrell, 100 NY2d 186, 190 (2003). Later in this Decision, the Court will address the standard of review governing segmentation under SEQR.

COMMON COUNCIL ENVIRONMENTAL REVIEW COMPLIANCE WITH SEQR AND CERO

The Common Council Did Not Improperly Classify The Agreement as an Unlisted Action

6 NYCRR, § 617.6 defines the regulatory criteria for initial review of actions and establishment of a lead agency. In relevant part, 6 NYCRR § 617.6 recites:

§ 617.6 Initial review of actions and establishing lead agency.

(a) Initial review of actions. (1) As early as possible in an agency's formulation of an action it proposes to undertake, or as soon as an agency receives an application for funding or for approval of an action, it must do the following:

. . .

(iv) make a preliminary classification of an action as Type I or Unlisted, using the information available and comparing it with the thresholds set forth in section 617.4 of this Part. Such preliminary classification will assist in determining whether a full EAF and coordinated review is necessary.

. . .

(3) For Unlisted actions, the short EAF (see section 617.20, Appendix C. of this Part) must be used to determine the significance of such actions. However, an agency may instead use the full EAF for Unlisted actions if the short EAF would not provide the lead agency with sufficient information on which to base its determination of significance. The lead agency may require other information necessary to determine significance. . . .

In relation to their environmental claims, Petitioners argue that the Common Council should have, but failed to, classify the "project" as a Type I action. Petitioners' argue that if the Common Council had not segmented the environmental review of the Agreement from the Casino and had treated the two (2) projects as one (1) action, the joint project would have been a Type I action. (Petitioners' Memorandum of Law, paragraphs 36 — 38)

This claim is without merit. The Common Council's environmental review focused on the adoption of the Agreement which is clearly an Unlisted Action. Petitioners do not and cannot argue otherwise. Instead, Petitioners argue that until the Common Council had adopted segmentation findings, it should have performed a single comprehensive environmental review for both projects. Such a combined environmental review would make SEQR's segmentation regulations meaningless and is not required. See, Concerned Citizens for the Env. v. Zagata, 243 AD2d at 20, 23 (3rd Dept. 1998). As explained by the Court in the Zagata case, "[i]f such were a prerequisite to obtaining a permit for a particular aspect of a project, the lead agency would be required, in every case where segmented review is sought, to conduct a full SEQR review for the entire project, thus emasculating any concept of segmented review." The Common Council properly classified the Agreement as an Unlisted Action pursuant to SEQR.

The Common Council Properly Coordinated its Review

Petitioners argue that the Common Council failed to conduct a properly coordinated environmental review. (Petitioners' Memorandum of Law, pages 42 — 43) Specifically, the Petitioners argue that the Common Council received a revised Full Environmental Assessment Form relative to the Agreement in mid-October 2006 and that "there was no attempt by City Respondents to coordinate the review of this new action with the other Respondents in this proceeding or any other approving body." ( Id., at 43) The Record does not support Petitioners' contention.

On October 12, 2006, the Seneca Nation provided the City with updated and revised environmental documentation analyzing the potential adverse environmental impacts associated with all of the City actions as spelled out in the Agreement, including a revised EAF, expanded environmental analysis and information, a geotechnical evaluation report for the project area; an updated utility impact report; and updated cultural resource analysis; a traffic impact study and an environmental conditions review of the project area.

The Common Council promptly provided the updated and revised environmental documentation to all of the interested and involved agencies, including the City of Buffalo Planning Board, the County of Erie Department of Environmental Planning, the City of Buffalo Appraisal Review Board, the BSA, the New York State Thruway Authority, the Buffalo Fiscal Stability Authority, the New York State Department of Transportation — Region 5, and the Department of Public Works. (LUK000761 — 778) Several of these agencies responded back to the Common Council with comments, including the City of Buffalo Planning Board and the Department of Public Works. (LUK000817 — 820) The Department of Public Works informed the Common Council that it had reviewed the traffic study and believed that it adequately addressed the impacts of abandoning and closing Fulton Street. Petitioners' claims that the Common Council made "no attempt to coordinate the review of the action" are unsupported in the Record.

The Common Council's Environmental Review Process

The Common Council's environmental review process commenced in July 2006 when the Seneca Nation provided the City with a full EAF, supplemental information about the Casino; a cultural resources report; a utility impacts report; and a site conditions report. (LUK00050 et. seq.) The first step in the environmental review process is for the lead agency to classify a proposed project as a Type I action, Type II action or an Unlisted action. 6 NYCRR § 617.6(a). A Type I action is one which is more likely to require the preparation of an EIS. 6 NYCRR § 617.4(a). Type II actions are those that have been determined not to have a significant adverse environmental impact, or are otherwise precluded from an environmental review.

6 NYCRR § 617.5(a) If a particular activity is neither Type I nor Type II, the activity is classified as an Unlisted action. 6 NYCRR § 617.2(ak)

In late July 2006, the Common Council classified the abandonment and sale of the Fulton Street ROW as an Unlisted Action for purposes of SEQR, declared its intent to act as lead agency, and circulated a copy of the EAF and other relevant information to all interested and involved agencies including the City of Buffalo Planning Board, the County of Erie Department of Environmental Planning, the City of Buffalo Appraisal Review Board, the Buffalo Sewer Authority (hereinafter referred to as "BSA"), the New York State Thruway Authority, the Buffalo Fiscal Stability Authority, the New York State Department of Transportation Region 5, and the City of Buffalo Department of Public Works, Parks and Streets (hereinafter referred to as "DPW"). (LUK000319 — 31) The Common Council gave each agency thirty (30) days to contest lead agency status. ( Id.). No other agency contested the Common Council's designation. (LUK000444, LUK000449) Therefore, the Common Council became the lead agency pursuant to SEQR.

Over the course of the next two (2) months, there were ongoing negotiations between City representatives and the Seneca Nation. (LUK 11/2/06 Affidavit) The City's negotiation team, led by Mayor Byron Brown, utilized the negotiations to secure commitments from the Seneca Nation that neither the Compact nor Federal Indian Gaming Law require relative to the Casino. ( Id.) As a result of these negotiations, the City was able to develop an agreement with the Seneca Nation which addresses all of the City Actions. ( Id.) In exchange for the City Actions, the Seneca Nation agreed to certain limitations and/or mitigation relative to their operation of the Casino. (LUK000456)

The Agreement provides, among other things, that the Seneca Nation will assist the City with its SEQR compliance. (LUK000465) Accordingly, on October 12, 2006, the Seneca Erie Gaming Corporation (hereinafter referred to as "SEGC") provided the City with updated and revised environmental documentation analyzing the potential adverse environmental impacts associated with all of the City Actions as spelled out in the Agreement, including a revised EAF, expanded environmental analysis and information, a geotechnical evaluation report for the project area; an updated utility impact report; and updated cultural resource analysis; a traffic impact study and an environmental conditions review of the project area. (LUK00050 et. seq.)

The Traffic Impact Study (hereinafter referred to as "The Study") evaluates traffic impacts associated with the Casino. (LUK000661) The Study was used by the City to evaluate whether the proposed roadway and traffic handling improvements required per the Agreement would be adequate. (LUK000675 — 90) The Study concludes that with the traffic mitigation measures that the Seneca Nation has agreed to implement, at their own cost, there will still be significant delays associated with events at the HSBC Arena, but otherwise the Casino will not have negative impacts on existing traffic flows. (LUK000690) Interestingly, The Study indicates that the proposed measures will actually improve upon existing conditions. Id.

The Common Council promptly provided the updated and revised environmental documentation to all of the interested and involved agencies including the City of Buffalo Planning Board, the County of Erie Department of Environmental Planning, the City of Buffalo Appraisal Review Board, the BSA, the New York State Thruway Authority, the Buffalo Fiscal Stability Authority, the New York State Department of Transportation Region 5, and the DPW. (LUK000761 — 778)

The Common Council held a Special Council Work Session on Wednesday, October 25, 2006 to review and consider the updated and revised environmental documentation. (LUK 11/2/06 Affidavit) The Special Work Session was attended by representatives of the DPW, the Planning Staff of the Office of Strategic Planning, Council staff and legal representatives. (LUK 11/2/06 Affidavit) In addition, SEGC's environmental consultants — those who prepared the updated and revised environmental documentation — including SEGC's traffic engineers, were also present. There was extensive discussion and review of the environmental documentation between the Common Council and the other attendees, particularly about The Study and whether the roadway and traffic handling improvements required pursuant to the Agreement would sufficiently mitigate adverse traffic impacts associated with the Casino. (LUK 11/2/06 Affidavit)

The next day, the Common Council held a public hearing on the proposed abandonment and sale of the Fulton Street ROW to the SEGC. The hearing was well attended. In particular, the Petitioners and their counsel were present and testified extensively to their opposition to the Seneca Nation Actions as well as the City Actions. (LUK 11/2/06 Affidavit)

During the SEQR review, various interested and involved agencies participated in the SEQR process and assisted the Common Council by providing comments on environmental matters. For instance, the New York State Thruway Authority notified the Common Council that the abandonment of the Fulton Street ROW would not have any impact upon the New York State Thruway system. (LUK000444) The Buffalo Police Department evaluated the potential impacts of the Agreement upon police services. (LUK000799) The Police Department concluded that the Agreement would have no detrimental impact upon their ability to police the area of the Casino and that existing crowd control procedures will adequately address any large events at the Casino. (LUK000799)

The Buffalo Fire Department also evaluated the potential impacts of the Agreement and determined that it would have no negative impact on the Fire Department's ability to handle fire or other emergencies in the area of the Casino. (LUK000800) In addition, the Fire Department determined that there will be sufficient emergency access to the Casino should the Fulton Street ROW be abandoned. (LUK000800)

The Planning Staff from the Office of Strategic Planning also participated in the SEQR process. (LUK000817) Planning Staff, who typically handle SEQR reviews for the City of Buffalo Planning Board, reviewed all of the environmental documentation submitted by SEGC. (LUK000818) Planning Staff even requested some additional documentation from SEGC which was supplied. (LUK000818, LUK000939) Based on their review, Planning Staff concluded that the environmental information provided a thorough analysis of potential environmental impacts associated with the City Actions and supported the issuance of a Negative Declaration under SEQR. (LUK000818)

The BSA advised the Common Council that it had reviewed the impacts of providing sewer service to the Casino through its system. (LUK000318) The BSA noted that the sewer infrastructure in place in the area of the Buffalo Creek Territory was built at a time when the City had a greater population than it does now. ( Id.) The BSA concluded that the area in question, because it was part of a large industrial corridor, would have more than adequate infrastructure to convey the waste generated by a new casino and surrounding development. ( Id.) In addition, the BSA's treatment plant can handle any increased flows generated by the Casino. ( Id.)

The DPW also reviewed the environmental documentation and the Agreement. (LUK000820) The DPW informed the Common Council that it believed The Study adequately addressed the impacts of abandoning and closing the Fulton Street ROW. ( Id.) The DPW also concluded that the proposed transportation improvements associated with the Agreement will adequately address any future traffic issues that may arise as a result of the Seneca Nation Actions. ( Id.) With respect to utility impacts, DPW commented that the proposed relocation plan is appropriate. ( Id.) In addition, DPW indicated that it had reviewed the impact of providing water services to the Buffalo Creek Territory and had determined that the City of Buffalo's water system has capacity that is sufficient to service the proposed development. ( Id.)

The day before making its Determination of Significance, the Common Council held a caucus meeting. (LUK 11/2/06 Affidavit) As with the public hearing on October 26, 2006, Petitioners' supporters and their counsel were in attendance. (LUK 11/2/06 Affidavit) The Common Council, once again, gave Petitioners' supporters an opportunity to speak to the City Actions. Once again, Petitioners' supporters objected to the City Actions and urged the Common Council to "fight the casino" on environmental and other grounds. At this meeting, the Common Council also received the final environmental information which SEGC had provided in response to Planning Staff comments. (LUK000929 et. seq.) The Common Council ended the meeting with a discussion of environmental issues. (LUK 11/2/06 Affidavit)

Taking all of the information developed during the environmental review process into account, the Common Council's Determination of Significance sets forth twenty (20) reasons supporting its negative declaration for the City Actions and cites more than fifty-seven (57) documents which the Common Council considered and relied upon (including reports by environmental experts). (LUK000001 et. seq.) The relevant areas of environmental concern identified by the Common Council in the Determination of Significance include:

Potential impacts to land use including unique or unusual land forms.

Potential impacts to water resources including the water table, protected bodies of water or wetlands.

Potential impacts associated from construction activities including noise, dust and odors

Potential impacts to bedrock.

Potential impacts to the City's water system.

Potential impacts to City's sewer system.

Potential impacts to vegetation and wildlife.

Potential impacts to agricultural resources.

Potential impacts to aesthetics.

Potential impacts to cultural resources.

Potential impacts to open space and /or conservation areas.

Potential impacts to recreation, park land and scenic views.

Potential impacts on critical environmental areas.

Potential traffic impacts.

Potential impacts to energy usage.

Potential impacts to public health and safety.

Potential impacts to community resources and services.

Consistency with the City of Buffalo's comprehensive plan.

(LUK000007 — 8)

The Council Review at Each of the Relevant Areas of Environmental Concern

In the Determination of Significance, the Common Council analyzed, in detail, all of the relevant areas of environmental concern noted above and concluded that the City actions would not result in any significant adverse environmental impacts. (LUK000007-8)

With respect to the impacts to the City's water and sewer systems, the Common Council found that:

22. The Proposed Agreement entails the capping and removal of old cast iron (100 Ñ years) water lines in Fulton between Michigan and Marvin and Marvin between South Park and Perry. A new ductile iron water main will be installed in Marvin Street between South Park and Perry. The cutting, capping and removing of these lines will have no adverse impact on the City of Buffalo water system; the system will be able to supply adequate water flows (domestic and fire flows) and pressures to service this Buffalo Creek Territory and surrounding area.

23. The sanitary sewer flows for this area will be separated from the storm sewer flows. Storm sewer flows from the Seneca Buffalo Creek Territory will be collected on site and flow to a new dedicated storm sewer line. Sanitary sewer flows from the Seneca Buffalo Creek Territory will discharge into the existing combined sewer along South Park Avenue. Adequate capacity exists within the BSA system for the discharges associated with the Casino.

(LUK000007)

With respect to noise, dust and odors, the Common Council found that:

24. Construction and excavation activities pursuant to the Proposed Agreement may create minor temporary fugitive dust emissions and may result in minor emissions from construction equipment. These impacts will be temporary and are not significant.

33. There will be temporary noise impacts during construction. However, construction will take place during daylight hours and will not be significant.

(LUK000007-8)

With respect to traffic impacts associated with the City Actions, the Council found that: 31. The abandonment of the Fulton St. ROW and the road improvements will change traffic patterns in the area. However, the loss of the Fulton St. ROW is not significant (the area has a well developed roadway network system) and, as a result of the Proposed Agreement, the Seneca's will undertake at their own expense significant traffic related improvements in the project area. These improvements will result in a significant improvement to traffic conditions in the project area.

(LUK0000008)

With respect to potential impacts to cultural resources, the Common Council found that:

A cultural resource analysis has been completed. The project area is not substantially contiguous to, nor does it contain, buildings, sites or districts listed on the State or National Registers of Historic Places. Further, the construction work associated with the Proposed Agreement should not negatively impact any architectural or cultural resources since the proposed work is limited to the roadbed and does not involve extensive construction within Cobblestone Historic District. In addition, a monitoring and response plan has been developed in the event any archeological artifacts are discovered during construction.

(LUK000008)

With respect to the consistency of the City Actions with the City's Comprehensive Plans, the Common Council found that:

36. The adoption and implementation of the Proposed Agreement, is consistent with the City's recently adopted Comprehensive Plan entitled Buffalo's Comprehensive Plan: Queen City in the 21st Century" dated October 2004. In addition, adoption and implementation of the Proposed Agreement addresses the concerns expressed about the Casino in the "Queen City Hub Plan'.

(LUK000008)

In conclusion, the Council determined that:

37. Considering all of the above, segmenting the environmental review for the Proposed Agreement from the construction and operation of the Casino is appropriate and permissible and the adoption and implementation of the terms of the Proposed Agreement will not have a significant adverse impact upon the environment and a negative declaration pursuant to SEQR is hereby issued."

(LUK000009)

The detailed analysis found in the Determination of Significance, for each of the relevant areas of environmental concern identified by the Common Council, addresses the requisite "hard look" required by SEQR. Chinese Staff and Workers Association v. City of New York, 68 NY2d 359 (1986).

The Reasoned Elaboration of the Common Council of the Basis for its Determination

In reaching its determination that a negative declaration was appropriate pursuant to the requirement of SEQR, the Common Council made a total of thirty-eight (38) different findings which provide a reasoned elaboration of the basis for their SEQR determination. (LUK00001 — 11) As detailed in the "Whereas" recitals to the Determination of Significance:

The Council considered whether the Nation Actions can properly be segmented from the environmental review for the City Actions in accordance with the requirements of SEQR; and

A thorough analysis of the relevant facts and law shows that segmenting the environmental review for the City Actions from the Nation Actions is appropriate and in accord with the requirements of SEQR; and

The Common Council has carefully considered the full scope of the City Actions having reviewed and considered the entire record and proceedings relating to the City Actions and having considered the comments and points of view of both proponents and opponents of the Casino; and

The record demonstrates that to the extent there are adverse environmental impacts associated with the City Actions, where necessary, all adverse impacts have been mitigated to the greatest extent possible and that none of these impacts will be significant; and it is appropriate that the Common Council as lead agency issue a negative declaration for the adoption and implementation of the Proposed Agreement.

(LUK000004 — 5)

Petitioners argue that even if an environmental review is limited to the City Actions, a Negative Declaration is inappropriate. Knoer Affidavit, paragraphs 77-89. However, an examination of Petitioners' claims show that principally their objections are associated with the potential environmental impacts of Seneca Nation Actions on the site and not City Actions. For instance, Petitioners argue that the City Actions cannot receive a negative declaration because the activities "grossly exceed Type I thresholds." Knoer Affidavit, paragraph 49. However, all of the Type 1 thresholds that Petitioners cite relate to the Seneca Nation Actions rather than the City Actions. Id. Petitioners also cite increases in traffic, air pollution, light pollution, and noise to argue that a negative declaration is inappropriate. Knoer Affidavit, paragraph 51. On the record before the Court, these complaints relate to the Seneca Nation Actions rather than the City Actions. See, for example, Knoer Affidavit, paragraph 53 ("This excessive lighting will be on 7 days a week, 24 hours a day, 365 days a year.").

The Record amply demonstrates that the Common Council performed an environmental review of the City Actions. As demonstrated above, the Common Council identified relevant areas of environmental concern, took a "hard look" at them and provided a reasonable elaboration of their findings. (LUK00001-10) In reviewing a lead agency's compliance with SEQR, the Court may not weigh the desirability of the action or determine what, if any, adverse environmental effects may result from it. Har Enterprises v. Town of Brookhaven, 74 NY2d 524, 528-29 (1989). If an agency is given due consideration to the relevant potential environmental impacts of a project, has reached its determination in a reasonable fashion, and made a reasoned elaboration of the basis for its decision, a court is not permitted to second guess the agency's choice. Hallenbeck v. Onondaga County Resource Recovery Agency, 225 AD2d 1036, 1036 (4th Dept. 1996).

The Common Council is Vested with Discretion in Determining when a Project is Consistent with a Comprehensive Plan

Decisions of the legislature are vested with a strong presumption of validity. Kravetz v. Plenge, 84 AD2d 422, 428 (4th Dept. 1982). Zoning or land use decisions are required to be consistent with the fundamental land use policies and development plans of the community. Udell v. Haas, 21 NY2d 463, 472 (1968). However, while stability and regularity are essential to the operation of zoning plans, zoning is not static. Kravetz v. Plenge, 84 AD2d at 428. The legislature's obligation is to support " . . . comprehensive planning, not slavish servitudeto any particular comprehensive plan. Id., Tilles Investment Co. v. Town of Huntington, 74 NY2d 885, 887 (1989). Sound planning inherently calls for recognition of the dynamics of change." Town of Bedford v. Vill. of Mt. Kisco, 33 NY2d 178, 188 (1973).

Petitioners allege that the sale of the Fulton Street ROW is improper because it is inconsistent with the City's Comprehensive Plan (hereinafter referred to as "Comprehensive Plan") pursuant to General City Law (hereinafter referred to as "GCL") § 28-A. Petitioners argue, as self-evident, that because the abandonment and sale of the Fulton Street ROW is related to the Seneca Nation's Casino, it is necessarily inconsistent with the Comprehensive Plan. Petitioners fail to provide any evidence to support their assertions that the abandonment and sale of the Fulton Street ROW is inconsistent with the Comprehensive Plan.

The Proposed Agreement is Consistent with the Comprehensive Plan

Petitioners allege non-compliance with the Comprehensive Plan as well as with the City of Buffalo Queen City Hub Plan. (Petitioners' Memorandum Of Law at pages 27-28) Petitioners allege that the Common Council failed to consider the performance criteria for casino gambling suggested in the Queen City Hub Plan. With respect to casino gambling, the Queen City Hub Plan provided as follows:

The Seneca Nation of Indians has an agreement that allows them to develop casino gambling facilities in Downtown Buffalo. Opinion is divided on whether such a development would be good for Downtown specifically or Buffalo as a whole. In any event, plan reviewers believe a range of key issues need to be addressed and potential social and economic impacts carefully assessed before moving forward. We especially need to know whether a casino would provide net employment and revenue growth for the city, as well as what negative social impacts are likely to occur and how to minimize them.

Some reviewers of The Queen City Hub say that if a casino is developed it should respond to the following performance criteria:

1. Locate in Downtown Buffalo in order to take advantage of existing infrastructure, to reuse the stock ofexisting buildings, and create synergies with other visitor attractions.

2. Integrate with the City physically through the careful design of entries and connections, programmatically through business arrangements to make sure the economic benefits are widely shared locally.

3. Target tourists, not residents, to make sure the casino attracts outside revenues, avoids exploiting local players, and complements efforts to build convention and tourism business.

4. Ensure revenue accrues to local government rather than the State to pay for new infrastructure and services, to invest in Downtown redevelopment, to support tourism development and marketing, and to help provide for the general needs of the city and county.

Queen City Hub Plan, http://www.city-buffalo.com/Files/1_2_/Hub/Volume%20I/2other Proposals.htm,. Contrary to Petitioners' assertions, the performance criteria identified in the Queen City Hub Plan constitute the issues considered when formulating the Agreement with the Seneca Nation.

The Buffalo Creek Territory is located between Perry Street to the north and South Park to the south, Michigan Avenue to the west and Marvin Street to the east. With respect to infrastructure, the Seneca Nation has committed to a total of $5 million — $7 million in infrastructure improvements to the area surrounding the Buffalo Creek Territory. (LUK000456) These include significant water, sewer and transportation improvements. (LUK000467.

The agreement also contemplates the integration of the Seneca Nation Casino into the surrounding neighborhood. ( Id.) The Buffalo Creek Territory is within the Erie Canal Harbor Strategic Investment Area which is slated for further cultural, maritime, residential, commercial, retail, sports and entertainment venues. ( Queen City Hub Plan, "Achieving the Vision: Strategic Investment Areas," http://www.city-buffalo. com/ Files/1_2_/Hub/Volume%20I/2investAreas.htm). The proposed design for the Seneca Nation Casino contemplates a park-like atmosphere in an area formally occupied by abandoned industrial uses. (LUK000529) Further, the proposed orientation of the Seneca Nation Casino is designed to feed off the HSBC and Dunn Tire Park sports and entertainment venues to the west. ( Id.) Since many of the design features resulted from the abandonment of the Fulton Street ROW, the Agreement helps ensure that the Seneca Nation Casino is well incorporated into the surrounding neighborhood. Id.

Relative to the third and fourth performance criteria, economic concerns are key issues addressed in the Agreement. First, the Seneca Nation and the City have agreed to work together to facilitate the designation of the City as the "host municipality" pursuant to the Compact and Section 99-H of the New York State Finance Law. (LUK000463) In addition, the Seneca Nation has agreed to help assist the City in obtaining at least twenty-five percent (25%) of the State contribution received from gaming operations. (LUK000466) These monies are slated to be re-invested into development projects for the Inner Harbor Area in order to create a critical mass of tourism and visitors the area. (LUK000466)

Under the agreement, the Seneca Nation has agreed to coordinate with the Buffalo Convention and Visitor Bureau to market the City and the facilities located on the Buffalo Creek Territory as a tourist destination; and specifically market the Seneca Nation Casino to people outside of the eight (8) counties of Western New York. (LUK000467) The Seneca Nation has also committed up to $1.7 million toward marketing efforts. (LUK001535, LUK000467)

The proposed agreement also includes workforce assurances. (LUK000467) The Seneca Nation has agreed to give preference to Buffalo residents for jobs created by the Seneca Nation Casino. ( Id.) This provision was designed to favor the hiring of City residents, including additional opportunities for minorities and women from economically disadvantaged areas of the City. (LUK000467)

On the record before the Court, consideration and analysis of these issues were addressed by the Common Council prior to the approval of the Agreement. The Agreement and the environmental analysis performed by the Common Council in connection therewith, fully addressed the "performance criteria" included in the Queen City Hub Plan. (LUK000456 et seq.) After evaluating all of these factors and the documents provided by SEGC, the Common Council determined that the adoption and implementation of the Agreement is consistent with the City's Comprehensive Plan entitled "Buffalo's Comprehensive Plan: Queen City in the 21st Century" dated October 2004. (LUK00008) In addition, the Common Council determined that the adoption and implementation of the Agreement addresses the concerns expressed about the Seneca Nation Casino in the "Queen City Hub Plan". Id. There is sufficient evidence in the record to support this determination. Accordingly, the Common Council's determination in this regard should not be disturbed. Town of Bedford v. Village of Mt. Kisco, 33 NY2d 177, 186 (1973).

The Common Council Fully Complied with CERO

Petitioners argue that the Respondents failed to comply with CERO. CERO was adopted by the Common Council pursuant to SEQR (Charter and Code of the City of Buffalo, § 168-1(B)). CERO was designed as a supplement to the SEQR regulations (Charter and Code of the City of Buffalo, § 168-1(D)(j)). Where there is a conflict between CERO and SEQR, SEQR "shall supersede." (Id.) CERO does not create obligations beyond SEQR. In fact, Petitioners' CERO argument is that "[t]he City's failure to comply with SEQRA means it failed to comply with [CERO]" and "City Respondents violated CERO in the same ways City Respondents violated SEQRA." (Petitioners' Memorandum of Law, pages 51 — 52.)

Just as Petitioners' SEQR claims fail because the City performed a comprehensive environmental review relative to the Agreement before approving it, so too their CERO claim fails.

Common Council Segmentation of the Environmental Review of the Agreement from the Casino

In Petitioners' Second Amended Petition and Supporting Memorandum of Law, Petitioners' maintain that the Common Council improperly segmented its environmental review of the Agreement (including all City activities or approvals contemplated by the Agreement), from the Seneca Nation's Casino project. Petitioners maintain that: Respondents did not consider the impacts of the Casino in their environmental review;

Failed to consider the size and scope of the Casino in classifying the action pursuant to SEQR;

Impermissibly segmented the environmental review of the Agreement from the Casino;

Approved the Agreement based upon clear errors of law including segmentation;

Approved and executed the deed for Fulton Street in violation of the law because of improper segmentation.

To address the merits of Petitioners' claims, the Court is required to address the standards of review of segmentation under SEQR.

The Standard of Review Segmentation Under SEQR

6 NYCRR §§ 617.2 (ag) and 617.3 (g)(1) define and address the issue of segmentation of environmental review. The provisions provide:

§ 617.2 Definitions

. . .

(ag) Segmentation means the division of the environmental review of an action such that various activities or stages are addressed under this Part as though they were independent, unrelated activities, needing individual determinations of significance.

§ 617.3. General rules.

. . .

(g) Actions commonly consist of a set of activities or steps. The entire set of activities or steps must be considered the action, whether the agency decision-making relates to the action as a whole or to only a part of it.

(1) Considering only a part or segment of an action is contrary to the intent of SEQR. If a lead agency believes that circumstances warrant a segmented review, it must clearly state in its determination of significance, and any subsequent EIS, the supporting reasons and must demonstrate that such review is clearly no less protective of the environment. Related actions should be identified and discussed to the fullest extent possible. (Emphasis added.)

In Forman v. Tr. of State Univ. of New York, 303 AD2d 1019, 1020 (4th Dept. 2003), the court, in addressing segmentation of environmental review recited:

Segmentation is disfavored based on two perceived dangers. First is the danger that in considering related actions separately, a decision involving review of an earlier action may be practically determinative of a subsequent action. . . . The second danger occurs when a project that would have a significant effect on the environment is broken up into two or more component parts that, individually, would not have as significant an environmental impact as the entire project, or indeed, where one or more aspects of the project might fall below the threshold requiring any review.' (Citation omitted)

There are two (2) types of segmentation cases. The first type of segmentation case the type of segmentation case at issue here involves instances where a lead agency has affirmatively determined that segmentation is warranted and appropriate. SEQR expressly provides that segmentation is permissible and a cumulative environmental review is not required if a lead agency believes that segmentation is warranted under the circumstances, provided that the agency: (i) clearly states its reasons therefore; and (ii) demonstrates that a segmented review will be no less protective of the environment. 6 NYCRR § 617.3(g)(1). In Concerned Citizens for the Envt. v. Zagata, 243 AD2d 20, 22 (3rd Dept. 1998) citing 6 NYCRR § 617.3(g)(1), the court addressed segmented environmental review thus:

It is clear that segmentation, which is the dividing for environmental review of an action in such a way that the various segments are addressed as though they were independent and unrelated activities, is contrary to the intent of SEQR and is disfavored. Nevertheless, segmented review is permissible where the lead agency believes that it is warranted under the circumstances, provided that the agency clearly states its reasons therefore and demonstrates that such review is no less protective of the environment. Additionally, the related actions must be identified and discussed to the fullest extent possible.

The standard of review in these instances where a lead agency has made segmentation findings is reasonableness. Zagata, 243 AD2d at 22 ("The record amply supports DEC's determination . . ."); Defreestville Area Neighborhoods Assn., Inc. v. Town Bd. of the Town of North Greenbush, 299 AD2d 631, 634 (3rd Dept. 2002) (Town Board must justify its actions and demonstrate that segmentation is appropriate); Neville v. Koch, 79 NY2d 416, 424 (1992) (Not every conceivable environmental impact, mitigating measure, or alternative need be addressed in order to meet an agency's responsibility under SEQR; the degree of detail and the reasonableness of the agency's action will depend largely on the circumstances surrounding the action); Akpan v. Koch, 75 NY2d 561, 570 (1990) (Since it is not the court's role to evaluate de novo the data presented to the agency, the court must, as with substantive SEQR obligations generally, be guided by the rule of reason and refrain from substituting its judgment for that of the agency); Har Enters. v. Town of Brookhaven, 74 NY2d 524, 528-29 (1989) (In reviewing a lead agency's compliance with SEQR, a court does not weigh the desirability of the action or determine what, if any, adverse environmental effects may result from it); City of Saratoga Springs v. Zoning Bd. of Appeals of the Town of Wilton, 279 AD2d 756, 760 (3rd Dept. 2001) (A court's review of the administrative action in a SEQR case is limited to the record made before the agency).

The second type of segmentation case involves claims that a lead agency's environmental review failed to include another project or a separate component of the same project which is sufficiently related to the project under review that it warrants a single comprehensive environmental review. Village of Westbury v. Dept. of Transp., 75 NY2d 62 (1989) (alleged failure to review highway interchange project and highway widening project in same environmental review); Matter of Settco, LLC v. New York State Urban Dev. Corp., 305 AD2d 1026 (4th Dept. 2003), lv. denied, 100 NY2d 508 (alleged failure to review construction of Seneca Nation Casino in old convention center with development of a new, replacement convention center); Sun Co., v. Syracuse Indus. Dev. Agency, 209 AD2d 34 (4th Dept. 1995), appeal dismissed, 86 NY2d 776 (1995) (alleged failure to review cumulative effects of Carousel Landing project with other lakefront projects); Long Island Pine Barrens Socy. Inc., v. Town Bd. of Town of Riverhead, 290 AD2d 448 (2nd Dept. 2002), lv. denied, 98 NY2d 615 (alleged failure to consider impacts of re-zoning for golf course and residential development associated with golf course in single environmental review); City of Buffalo v. New York State Dept. of Envtl. Conservation, 184 Misc 2d 243 (Sup.Ct., Erie County 2000) (alleged failure to consider cumulative impacts of new bridge and toll plaza together); Stewart Park and Reserve Coalition v. Slater, 225 FSupp2d 219 (NDNY 2002) (alleged failure to consider new Interstate Interchange with environmental review for airport expansion).

In these cases, the lead agency makes no findings relative to segmentation and a court must determine de novo whether two (2) projects are sufficiently related to warrant a single environmental review. Dunk v. City of Watertown , 11 AD3d 1024 , 1026 (4th Dept. 2004) ("the proposed demolition and the Streetscape Project were not in any way related, other than with respect to their general locations."); Settco, 305 AD2d at 1027 ("The two projects are sufficiently independent of one another as to be separately reviewable."); Forman, 303 AD2d at 1020 (Five campus housing projects were not sufficiently related where they were planned separately, have unique funding sources and are in no way interdependent); Noslen Corp. v. Ontario Bd. of Supervisors, 295 AD2d 924, 925 (4th Dept. 2002) ("The record establishes that the construction of the new jail is a discrete project that is not part of any long-range plan of action, and thus segmentation did not occur . . .").

To evaluate these types of claims, Courts generally rely on the relevant factors identified by the New York State Department of Environmental Conservation (hereinafter referred to as "NYSDEC") in the SEQR Handbook (hereinafter referred to as "NYSDEC Factors"), a publication of the NYSDEC available at http://www.dec.state.ny.us/dcs/seqr/handbook/index.html. The NYSDEC Factors include:

1. Purpose: Is there a common purpose or goal for each segment?

2. Time: Is there a common reason for each segment being completed at or about the same time?

3. Location: Is there a common geographic location involved?

4. Impacts: Do any of the activities being considered for segmentation while not necessarily significant by themselves, contribute towards significant cumulative or synergistic impacts?

5. Ownership: Are the different segments under the same ownership or control?

6. Planning: Is a given segment a component of an identifiable overall plan?

7. Utility: Can any of the interrelated phases of various projects be considered functionally dependent on each other?

8. Inducement: Does the approval of one phase or segment commit the agency to approval of other phases?

If different projects (or different components of the same project) are sufficiently related based on the NYSDEC Factors, a single environmental review is generally required. Village of Westbury v. Dept. of Transp., 75 NY2d 62, 69 (1989) ("The two [projects] are complimentary components of the remedy for the Northern State Parkway's traffic flow problems, sharing a common purpose, integrated and scheduled for consecutive construction. Thus, the design of each is dependent on the other . . .") Sun Co. v. Syracuse Indus. Dev. Agency, 209 AD2d 34, 48-49 (4th Dept.), appeal dismissed, 86 NY2d 776 (1995); Defreestville Area Neighborhoods Assn., Inc., v. Town Bd. of the Town of North Greenbush, 299 AD2d 631, 634 (3rd Dept. 2002); Citizens Concerned for the Harlem Valley Envt. v. Town Bd. of town of Amenia, 264 AD2d 394 (2nd Dept. 1999); Teich v. Buchheit, 221 AD2d 452 (2nd Dept. 1995); City of Buffalo v. New York State Dept. of Envtl. Conservation, 184 Misc 2d 243 (sup. Ct., Erie County 2000). These are the types of cases cited by Petitioners in support of their segmentation arguments, (Petitioners' Brief, pages 18 — 21), which are generally inapplicable in situations such as here, where the Common Council, as lead agency, has made an affirmative determination that segmentation is warranted and appropriate.

On the record before the Court, the Common Council affirmatively segmented environmental review of the sale of Fulton Street from construction of a Type III gaming casino. In light of the Common Council's affirmative determination, the Court's standard of review is the reasonableness of the segmentation determination as contrasted to de novo review of whether the two projects are sufficiently related to warrant a single environmental review. Dunk, supra at 1024, 1026.

The Court now analyzes the Common Council's written segmentation findings.

The Common Council's Written Segmentation Findings

The Common Council's Findings of Fact in connection with segmented environmental review and approval of the sale of Fulton Street are set forth in LUK000005 — 11.

The record shows that the Common Council examined the circumstances surrounding both the Agreement and the Senecas' Casino project, after careful and reasoned analysis, determined that the environmental review for the Agreement could properly be segmented from the Casino. (LUK00001 — 11) As a threshold step, the Common Council evaluated whether the Agreement and the Casino were sufficiently related based on the NYSDEC Factors to warrant a single comprehensive environmental review. (LUK000005) The Common Council found that the Agreement and the Casino were sufficiently related such that SEQR would usually require the two (2) projects to be addressed in a single environmental review.

Having made this determination, the Common Council next considered whether segmentation would be appropriate under the circumstances surrounding the Agreement and the Casino. (LUK000005 — 6) The Common Council determined that segmentation was appropriate under the circumstances because the Council had no authority over the construction and operation of the Casino. (LUK000005) As explained by the Common Council, while the City could undertake a study to assess environmental impacts associated with the construction and operation of the Casino, the City could not require the Senecas to mitigate potential adverse environmental impacts relative to the Casino, nor could it require the Seneca Nation to consider reasonable alternatives. (LUK00005)

The Common Council also evaluated whether segmenting the environmental review for the Agreement from the Seneca Nation's Casino project would be no less protective of the environment. (LUK000005 — 6) The Common Council provided a detailed explanation of a number of reasons why performing a segmented review for the Agreement was no less protective of the environment. The Common Council's reasons included: (i) the Agreement would eliminate or mitigate adverse environmental impacts associated with the Casino; (ii) through the Agreement, the City had maximized the mitigation it could get from the Senecas relative to the Casino; (iii) an environmental review of the Casino by the City would serve no useful purpose under SEQR because of the City's inability to force the Seneca Nation to mitigate adverse environmental impacts. The Common Council segmented the environmental review for the Agreement from the Casino having factually concluded that segmentation was warranted under the circumstances and was no less protective of the environment.

Concerned Citizens for the Envt. v. Zagata, 243 AD2d 20, 22 (3rd Dept. 1998), is persuasive and on point. Zagata involved a challenge to a determination by NYSDEC that different phases of the same project could properly be segmented pursuant to SEQR. American Ref-Fuel had submitted an application to NYSDEC for a permit to construct and operate an integrated solid waste management facility comprised of an incinerator, a solid waste transfer station and a recycling facility. Zagata, supra at 21. American Ref-Fuel decided to phase the project and submitted a draft environmental impact statement (hereinafter referred to as "DEIS") for the solid waste transfer station only. At first, NYSDEC rejected the DEIS initially determining that the different phases of the project were sufficiently related to warrant a single environmental review. Zagata at 21 — 23. However, NYSDEC later reconsidered and determined that a segmented environmental review was (i) warranted under the circumstances; and (ii) no less protective of the environment. This is exactly the process undertaken by the Common Council in segmenting the environmental review for the Agreement from the Casino.

The Fourth Department's ruling in Matter of Settco, LLC v. New York State Urban Dev. Corp., 305 AD2d 1026, 1027 — 28 (4th Dept. 2003), lv. denied, 100 NY2d 508, also supports the Common Council's segmentation findings. Settco involved a segmentation challenge where a lead agency makes no findings relative to segmentation requiring the court to determine de novo whether two (2) projects are sufficiently related to warrant a single environmental review. In Settco at 1027, the Fourth Department rejected petitioner's claim that the construction of a casino by the Seneca Nation in Niagara Falls within the old Niagara Falls Convention Center had to be evaluated together with the establishment of a replacement convention center in a single environmental review. The Court stated:

. . . In any event, even assuming the applicability of SEQRA to both projects, we conclude that the two projects are sufficiently independent of one another as to be separately reviewable ( see Matter of Noslen Corp. v Ontario County Bd. of Supervisors, 295 AD2d 924, 925-926 [2002]; Matter of Iroquois Cent. School Dist. v Zagata, 241 AD2d 945, 946 [1997]). The actions' or projects' in question are distinct and are not merely separate parts of a set of activities or steps' in a single action or project (617.3[g]; see 617.2[ag]). Where, as here, projects are independent of each other and are not part of an integrated or cumulative development plan,' and their only common element is their general location,' the projects may be reviewed separately and are not subject to a claim of improper segmentation, nor is cumulative analysis' of the two projects required ( Matter of Forman v Trustees of State Univ. of NY, 303 AD2d 1019, 1020 [2003]; see Matter of Long Is. Pine Barrens Socy. v Planning Bd. of Brookhaven, 80 NY2d 500, 513-515 [1992].

The Common Council Segmentation Determination.

Segmented environmental review is permissible if a lead agency believes that segmentation is warranted under the circumstances, provided that the agency: (i) clearly states its reasons therefore; and, (ii) demonstrates that a segmented review will be no less protective of the environment. Zagata, supra . at 22 (citing 6 NYCRR § 617.3(g)(1)).

SEQR requires review of an entire set of activities or steps that constitute a project, whether the agency decision-making relates to the project as a whole or to only part of it. 6 NYCRR §§ 617.2(ag) and 617.3(1)(a). On the record before the Court, (LUK000005), the Common Council evaluated whether the City Actions and the Seneca Actions should be treated as related actions for purposes of SEQR. Applying the NYSDEC Factors to the information known about each set of activities, the Council determined:

3. The Proposed Agreement, discussed extensively herein, will embody certain assurances relative to the construction and operation of the Casino by the Senecas. In addition, the abandonment and sale of the Fulton St. ROW will affect the options available to the Senecas for the construction of the Casino. Moreover, the Proposed Agreement provides that the Senecas will build a 220,000 square foot casino with a specialty restaurant, a 24 hour casual dining restaurant, a multi-purpose room, retail stores and a 2500 space parking garage substantially in accordance with the design that was publicly unveiled on or about June 1, 2006 with an aggregate capital investment by SEGC of at least $125,000,000 and which will include 1900-2200 slot machines and 30-50 table games.

4. As such, the adoption and implementation of Proposed Agreement and the construction and operation of the Casino are related actions pursuant to SEQR.

(LUK000005)

Having found that the City Actions and the Seneca Actions were sufficiently related based on NYSDEC's Factors to warrant a single environmental review, the Common Council next considered whether segmentation would be appropriate. The Common Council of the City of Buffalo stated:

5. [A]n environmental review for the construction and operation of the Casino presents a unique challenge. The purpose of a SEQR review is to incorporate environmental considerations directly into governmental decision-making and to mitigate adverse environmental impacts to the maximum extent practicable.

6. The Nation-State Gaming Compact between the Seneca Nation of Indians and the State of New York allows the Nation to establish the Casino in the City without any approval or review from the City. The Senecas have already taken the Buffalo Creek Territory in restricted fee status.

7. The Senecas are free to construct and, in fact, are already constructing the Casino without any approvals, permits or authorizations from the City. Accordingly, while the City could undertake a study to assess environmental impacts associated with the construction and operation of the Casino, the City cannot require the Senecas to mitigate potential adverse environmental impacts relative to the Casino, nor can it require the Senecas to consider reasonable alternatives.

(LUK00005)

The Common Council deemed segmentation of the environmental review for the City Actions and the Seneca Actions appropriate under the circumstances as its only reasonable choice. (LUK000001 — 11)

Next, the Common Council examined whether segmentation is no less protective of the environment. As explained in detail in the Determination of Significance, the Common Council found that there were a number of reasons why performing a segmented review of the City Actions was no less protective of the environment (LUK000009). One such reason was that the

City Actions would eliminate or mitigate adverse environmental impacts associated with the Seneca Actions:

8. That being the case, the City has utilized the Senecas' desire to obtain the Fulton St. ROW as a means to place some limitations upon the Seneca's construction and operation of the Casino and to try to mitigate potential adverse environmental and economic impacts that the Senecas would not otherwise be required to address.

9. Limitations and/or mitigation which the Proposed Agreement secures for the citizens of Buffalo include both binding covenants as well as declarations of good faith including among other things, that the Senecas will: (i) spend between $5 to $7 million making infrastructure improvements to City-owned lands around the Buffalo Creek Territory including major traffic handling improvements; (ii) integrate the Casino structures with the surrounding community and include an urban park on the site; (iii) employ approximately 1,000 people at Casino and give preference to City of Buffalo Residents for 50% of these jobs and will recruit in high unemployment areas; (iv) abide by a policy of trying to have a workforce composed of at least 25% minorities and at least 8% women; (v) market the Casino beyond the Western New York Region in order to help minimize adverse local economic impacts and, (vi) not acquire additional property around the Buffalo Creek Territory for Casino operations.

(LUK000005 — 6)

The Common Council also noted that the City had maximized the mitigation it could get from the Senecas relative to the Casino:

10. These conditions are the limit to what the City has been able to negotiate with the Senecas and the City does not have the ability to place any further conditions upon the Senecas' construction or operation of the Casino.

(LUK000006)

In evaluating whether segmentation was appropriate, the Council also examined the reasons that segmentation is disfavored and analyzed whether, in this unique circumstance, segmentation could be performed without running afoul of SEQR's basic policies:

11. Segmentation is disfavored based on two perceived dangers. First is the danger that in considering related actions separately, a decision involving review of an earlier action may be practically determinative of a subsequent action. While the adoption and implementation of the Proposed Agreement will be practically determinative of some aspects of Casino construction and operation, those aspects involve conditions, established through the Proposed Agreement, that are designed to limit the potential adverse social, economic and environmental impacts of the Casino upon the City of Buffalo and its citizens.

12. The second danger of segmentation occurs when a project that would have a significant effect on the environment is broken up into two or more component parts that, individually, would not have as significant an environmental impact as the entire project, or indeed, where one or more aspects of the project might fall below the threshold requiring any review. That is not the case here. As discussed extensively herein, the potential environmental impacts of the adoption and implementation of the Proposed Agreement have been studied extensively pursuant to SEQR.

(LUK000006)

Finally, the Common Council explained that reviewing the impacts of the Seneca Actions would serve no useful purpose under SEQR:

13. Accordingly, performance of an environmental review which includes the construction and operation of the Casino by the City would not serve any useful purpose. The City has obtained all mitigation it can relative to the construction and operation of the Casino and it is therefore reasonable to segment the environmental review for the adoption and implementation of the Proposed Agreement from the construction and operation of the Casino.

14. Segmenting the environmental review for the Proposed Agreement from the construction and operation of the Casino is no less protective of the environment because the actions of the City as provided for in the Proposed Agreement will not determine whether the Senecas site a Casino on the Buffalo Creek Territory. Such decision has been made and the City of Buffalo is powerless to stop it.

(LUK000006)

Accordingly, after performing an investigation of segmentation and evaluating the circumstances associated with the Seneca Actions and the City Actions, the Common Council determined that the City Actions could properly be segmented from the Seneca Actions for purposes of SEQR:

16. As the City does not have the jurisdiction to impose environmental mitigation or require abatement of adverse environmental impacts upon the Senecas relative to the construction and operation of the Casino, that activity will be segmented, as expressly authorized by SEQR, from the adoption and implementation of the Proposed Agreement.

(LUK000007)

On the record before the Court, the Common Council evaluated the segmentation issues and came to its conclusion as to the reasonableness of segmentation. The Common Council's "Determination of Significance" includes an identification and discussion of the City Actions and Nation's Actions and clearly articulates the Common Council's rationale for segmentation. Again, although generally disfavored under SEQR, segmented environmental review of projects has been approved by New York State Courts. Concerned Citizens for the Environment v. Zagata, 243 AD2d at 21, 22 (3rd Dept. 1998); In the Matter of Settco LLC v. New York State Urban Development Corporation, 305 AD2d 1026 (4th Dept. 2003).

Applying Zagata and Settco to the facts at hand, it is uncontroverted that the nine (9) acres owned by the Seneca Nation in the City of Buffalo was exempt from environmental review under SEQR. Respondents' actions in connection with the sale of Fulton Street ROW included a detailed environmental review of the impact of said sale to the Seneca Nation. Under Settco, segmented environmental review, where the underlying project is deemed exempt as a Type II action (or otherwise in light of the ownership of the nine (9) acres of land by a sovereign nation) allows segmented review.

The Record demonstrates that the Common Council acted reasonably in its determination to segment environmental review of the sale of Fulton Street. This aspect of Petitioners' claim is dismissed as a matter of law.

THE COMMON COUNCIL APPROVAL OF THE ABANDONMENT AND SALE OF THE FULTON STREET ROW PURSUANT TO CITY CHARTER § 27-4

The Petitioners argue that the Common Council improperly sold the Fulton Street ROW under the procedures in the City Charter which govern the sale of abandoned property (§ 27-5) instead of the procedures which govern the sale of property for redevelopment (§ 27-13).

(Knoer Affidavit, paragraphs 22-25)

The Common Council's authority to abandon and sell public rights-of-way is enumerated in several provisions of the Buffalo Charter and Code. First, City Charter § 2-1(7) provides that the City shall have the power to " . . . alter and discontinue and close to public travel, in whole or in part, streets, alleys, highways, and squares, and to regulate and control the acquisition, care, management and use thereof." See also, NY GCL § 20(7) (McKinney 2006). City Charter § 3-7(j) then confers this authority upon the Common Council.

The process by which City property can be abandoned and sold is governed by § 27-4 of the Buffalo Charter. See also, NY GCL § 23-2 (McKinney 2006). More specifically, section 27-4 provides the following process:

After an appraisal . . ., the council may by a two-thirds vote of all the members elected thereto authorize the sale of real property acquired by the city for public use, which has not been appropriated thereto, or the use of which for such purpose has been abandoned . . .

Id. While § 23-2 of New York General City Law requires a three-fourths majority of the legislative body for the sale of public property, a city may adopt legislation which alters those voting requirements.

The New York Attorney General has specifically opined on this issue. In informal opinion No. 83-16 on this exact issue, the Attorney General opined that pursuant to the City Home Rule Law, the legislature is free to establish its own voting requirements for the sale of real property and supersede the general requirements of GCL § 23. 1983 NY Op. Att'y Gen. 1039 (1983).

The reason for the divergence from the requirements of GCL § 23-2 was enunciated by the court in Colonial Motor Coach Corp. v. City of Oswego, 126 Misc. 829, 829 (1926), aff'd 220 A.D. 809 (4th Dept. 1927). The court found that § 23 of General City Law is not an absolute requirement that the sale or abandonment of city property must be authorized by a vote of three-fourths of all the members of the common council or be disposed of at public auction to the highest bidder. Id. at 836. Rather, General City Law § 23-2 allows the legislature to usurp a local rule (pursuant to a three-fourths vote) which inhibits the ability of the legislature to convey public property. Id. at 837.

In Mr. Knoer's Affidavit, he asserts that § 27-13 of the City Charter governs the sale of the Fulton Street ROW. However, by its clear language, § 27-13 governs the sale of City property for urban renewal or development purposes. This section specifically mimics the provisions of New York Urban Renewal Law (NY GML Art. 15) which provides the process by which property can be sold for urban renewal projects. The City's sale of the Fulton Street ROW is simply not part of any urban renewal project and therefore is not subject to the voting requirements of § 27-13 of the Charter.

On October 31, 2006, the Common Council voted on the a Resolution to abandon and sell the Fulton Street ROW. (LUK001533 — 38) At the meeting, the Common Council voted by a two-thirds (2/3) majority to abandon and sell a portion of the Fulton Street ROW between Michigan Avenue and Marvin Street pursuant to the terms and conditions of the agreement. (LUK001538) Therefore the abandonment and sale of the Fulton Street ROW was properly approved by the Common Council.

THE SENECA NATION IS A NECESSARY PARTY TO CERTAIN OF PETITIONERS' CLAIMS

At oral argument on July 27, 2007, this Court inquired whether the opening of a temporary Type III gaming facility on the Buffalo Creek Territory in the City in early July 2007 affected the necessary party analysis under CPLR § 1001(b) addressed by the Court in its February 8, 2007 Memorandum Decision and Order.

As reflected in the Record, the Court opened this inquiry because in its February 8, 2007 Memorandum Decision and Order which denied Respondents Motion to Dismiss pursuant to CPLR § 3211(a)10, the Court determined on the record then before it that Petitioners' claims related solely to Respondents' actions in approving segmentation of environmental review and approval of the sale of Fulton Street prior to any further action by Respondents and the Seneca Nation to implement the project. As reflected in the Record, with the passage of time, circumstances have changed the Seneca Nation has purchased Fulton Street for $631,000 the City has contracted with the Seneca Nation and is now providing sewer, water and emergency services a temporary casino is now in operation. The parties sharply disagree on whether or not the Seneca Nation is a necessary party to this special proceeding under CPLR § 1001(b).

Petitioners argue that the Seneca Nation is not a necessary party based in large part on the Court of Appeals' decision in Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 NY2d 801, cert. denied, 540 US 1017 (2003) and Red Hook v. Gowanda Chamber of Commerce , 5 NY3d 452 , 805 NYS2d 525 (2005). As noted by Petitioners, the Seneca Nation cannot be joined in this proceeding. Ransom v. St. Regis Mohawk Educ. Community Fund, 86 NY2d 553, 558 (1995). Respondents maintain the Seneca Nation is a necessary party to this special proceeding and the Court should dismiss all claims. To address this issue, the Court is required to perform the five (5) factor Red Hook analysis. Id. at 452; CPLR § 1001(b).

The Red Hook Analysis

Petitioners argue that the first factor, whether the Plaintiffs have another effective remedy if the action is dismissed on account of the non-joinder, is the most important of all factors and that they will be stripped of a remedy in this matter if the action is dismissed. (Petitioners Supplemental Memorandum, pages 2 — 6) However, Petitioners have admitted that they have other judicial remedies available to them. At oral argument on July 27, 2007, Petitioners' counsel updated the Court as to the status of a federal lawsuit Petitioners are pursuing in an effort to shut down the Casino. (Walters Affidavit, Exhibit A) According to Petitioners' counsel, the issue of whether the Casino site can be used for a casino under Federal Law is "now before the Second Circuit." (July 27, 2007 Transcript, page 69) Petitioners also have a pending motion for an injunction in the United States District Court for the Western District of New York (Judge Skretny) to shut down the Casino. (July 27, 2007 Transcript, pages 66 — 69) Thus, unlike the plaintiffs in the Saratoga case, Petitioners are not without judicial remedies if this case is dismissed.

The second factor in a court's 1001(b) analysis concerns the prejudice which may accrue from the non-joinder to the person not joined. Petitioners' argue that the Seneca Nation has chosen not to participate in this action. This argument ignores the fact that if Petitioners are granted the "void ab initio" relief they seek, the Seneca Nation will suffer prejudice to their rights and interests under the terms of the Agreement to ownership of Fulton Street, access to sewer, water and related services, and their continued operation of the Casino.

Petitioners argue that there are no relevant changes in the circumstances of this matter to cause this Court to modify its previous CPLR § 1001(b) analysis. In doing so, Petitioners ignore the plain fact that the City is providing sewer, water and related services to the Casino and it is now in operation.

The third factor under CPLR § 1001(b) is whether and by whom prejudice might have been avoided or may in the future be avoided. Any prejudice this lawsuit threatens to impose upon the Seneca Nation could have been avoided if Petitioners not delayed in bringing this proceeding until well after the Department of Interior action. Had Petitioners brought a proceeding during the appropriate comment or decision periods, before the Secretary of the Interior approved the Seneca Nation's acquisition of the Buffalo Creek Territory as a casino site, Petitioners could have avoided the need to sue an absent party.

The fourth factor under CPLR § 1001(b) concerns the feasibility of a protective provision by order of the court in the judgment. No provision in any order could protect the Seneca Nation's rights, particularly now that the Casino is open, because Petitioners now seek to void those rights. It is important to note that Petitioners' claims and the relief sought in the Second Amended Petition has evolved beyond a review of Respondents' actions on October 31, 2006 which the Court could resolve by merely sending the matter back to the Respondents. Instead, Petitioners now seek to void ab initio the sale of Fulton Street, the Seneca Nation's access to sewer, water and other services, and the operation of the Casino. (Second Amended Petition,

paragraphs 135 — 138) If Petitioners were to prevail, the Court would have to void the Agreement, direct Respondents to terminate the Seneca Nation's access to City sewer and water services, and the Seneca Nation would have to close their Casino.

The last factor under CPLR § 1001(b) is whether an effective judgment may be rendered in the absence of the person who is not joined. In this case, an effective judgment is not possible in the Seneca Nation's absence with respect to the aforementioned claims for relief. The Seneca Nation has purchased Fulton Street, procured sewer and water services and opened their Casino. Any action taken by the Court in furtherance of the relief Petitioners' seek will require affirmative action on the part of the Seneca Nation which is beyond the jurisdiction of this Court. The Seneca Nation has already acquired Fulton Street from the City, and as a non-party to this action, the Seneca Nation cannot be compelled to return Fulton Street to the City to effectuate a judgment in Petitioners' favor. Thus, all five factors under CPLR § 1001(b) clearly demonstrate that the Seneca Nation is a necessary party to certain aspects of this proceeding affecting its rights to Fulton Street, sewer, water and related services and operation of the Casino.

Petitioners cite 27th Street Block Association, 302 Ad2d 155 (1st Dept. 2002); Arnot-Ogden Memorial Hosp., 95 AD2d 947 (1st Dept. 2002) and Saratoga County Chamber of Commerce, Inc. v. Pataki, 100 NY2d 801 (2003) to argue that the balance of the factors in CPLR § 1001(b) "weigh heavily in favor of allowing the case to proceed." However, all three (3) cases are readily distinguishable. In 27th Street Block Association, the court found that FIT would not be materially prejudiced if the case continued without FIT. 27th Street Block Assn., supra at 162. In Arnot, supra at 948, the missing respondent was also not prejudiced and so failure to join was excused.

For the reasons recited above, the Record demonstrates that the Seneca Nation would be materially prejudiced by proceeding in their absence. As set forth above, the factors of alternative remedies, prejudice and rendering of an effective judgment favor dismissal because, if Petitioners are granted the relief they seek, the Seneca Nation will suffer significant prejudice to their rights and interests under the terms of the Agreement; their rights of ownership to Fulton Street; and they will have to shut down the Casino.

Petitioners' reliance on Saratoga, supra at 901, is misplaced. As this Court stated during oral argument on July 27, 2007, Saratoga "is different because Saratoga dealt with State power and the ability of the governor to enter into a treaty without legislative approval, but there was no casino. Saratoga is a separation of powers case." July 27, 2007 Transcript, page 80. Saratoga's main issue dealt with a citizen's constitutional challenge to the gaming compact signed by the governor. Saratoga is distinguishable because it did not involve challenges to a property transfer which requires joinder of the landowner, 100 NY2d at 808 — 810, and petitioners in Saratoga had no remedy if the Indian Nation's absence required dismissal. Id. at 820. Finally, the constitutional challenge in Saratoga could not be remedied by an Article 78 proceeding ( Id. at 815), which is not the case here.

Petitioners' misapplication of Saratoga carries over to Petitioners' reliance upon cases from other jurisdictions. Petitioners cite Dairyland Greyhound Park, Inc. v. McCallum, 655 NW2d 474 (2002) which concerned a constitutional argument which asserted that the Wisconsin Constitution precludes the governor from extending or renewing Indian gaming compacts. Id. at 486. There the case moved forward without the Indian Tribe because of the "considerable

interest in ensuring that state officials act in accordance with . . . the state constitution." Id. Again, the matter at hand involves no constitutional issues.

Petitioners also rely on People ex rel. Lungren v. Community Redevelopment Agency for the City of Palm Springs, 56 CalApp.4th 868 (1997), in which the court decided the question of whether a public agency had exceeded its lawful authority in transferring public land to a tribe.

Here, the matter at hand does not involve a question of the Common Council's legal authority, but whether the Council complied with SEQR.

Similarly, Petitioners' reliance upon Cayuga Indian Nation of New York, et. al. v. Pataki, et. al., 413 F2d 266 (2nd Circuit 2005); City of Sherill v. Oneida Indian Nation of New York, 544 US 197 (2005); and State of New York, et. al. v. Shinnecock Indian Nation, et. al., 523 FSupp2d 185 (EDNY 2007) is misplaced. In all those actions, the various Indian Nations were parties which is not the case here. Additionally, the state law issues framed by Petitioners in this special proceeding have all been addressed by this Court.

This Court is guided by two (2) Fourth Department decisions, the principles of which are relevant to this Court's determination under CPLR § 1001(b). Anderson v. Town of Lewiston, 244 AD2d 965 (4th Dept. 1997) and Niagara Mohawk Power Corp. v. Anderson, 258 AD2d 958 (4th Dept. 1999). In Anderson and Niagara Mohawk, the Fourth Department dismissed claims relating to utility services on the Tuscarora Nation Reservation determining the Nation was a necessary party. In Niagara Mohawk, supra at 959, the court stated:

. . . Because resolution of this controversy involves a determination of the rights and powers of the Indian Nation to consent to [electrical] service on its reservation, complete relief cannot be accorded [defendant and intervenors] without the Indian Nation as a party. Furthermore, because a judgment in [defendant's and intervenors'] favor would challenge the power of the Indian Nation, the Indian Nation might be inequitably affected' by this litigation ( Anderson v Town of Lewiston, 244 AD2d 965, 966, appeal dismissed 91 NY2d 920, citing City of New York v Long Is. Airports Limousine Serv. Corp., 48 NY2d 469, 475-476).

While Anderson and Niagara Mohawk involve utility claims which concerned the Tuscarora Indian Nation on reservation land, the principles underlying the CPLR § 1001(b) considerations in this action applies to Petitioners' claims concerning the transfer of Fulton Street; the Seneca Nation's receipt of water, sewer, and related utility services and operation of the Casino. The Seneca Nation now has title to Fulton Street and is currently operating a temporary Type III gaming casino on its site utilizing City provided water, sewer and related services. For purposes of the CPLR § 1001(b) the issue of whether the Buffalo Creek Territory land owned by the Seneca Nation in the City is "sovereign land" for purposes of operating a Type III gaming casino, is not the operative issue. The issue is whether Petitioners' claims concerning the City's transfer of Fulton Street and the Seneca Nation's securing water, sewer and emergency services on land in which it is currently operating a business requires the Seneca Nation as a party. Manupella v. Troy City Zoning Bd. of Appeals, 272 AD2d 761; Spence v. Cahill, 300 AD2d 992 (4th Dept. 2002).

The Court has fully addressed the merits of Petitioners' claims against Respondents concerning environmental review, segmentation and approval of the sale of Fulton Street. The Court determines Petitioners' claims with respect to voiding ab initio the Agreement, the transfer of Fulton Street, procurement of sewer and water services and the operation of the Casino mandates that the Seneca Nation be a party to such claims. Spence, supra at 993. With respect to such claims for relief, the Court grants Respondents' Motion to Dismiss. CPLR § 3211(a)10).

However, in light of the nature of Petitioners' claims against Respondents, the Court now addresses the merits of Petitioners' contentions with respect to said claims.

The Common Council's Resolution to Approve the Agreement was not Affected by an Error of Law

Petitioners argue that the Common Council approval of the Agreement was affected by two (2) errors of law (Petitioners' Memorandum of Law, pages 43 — 48). The first alleged error was the Common Council's segmentation determination. For the reasons recited herein, the Court has rejected Petitioners' segmentation claim.

Petitioners also argue that the Common Council was under a mistaken belief that the City has an obligation under federal and/or state law to provide sewer and water services to the Buffalo Creek Territory and to the Seneca Nation for their Casino. Petitioners' Memorandum of Law, pages 44 — 48.

The City is Contractually Required to Provide the Seneca Nation with Water, Sewer and Related Services

The Seneca Nation — City Agreement approved by the Common Council stated that there exists a requirement under existing federal law to provide water and sewer services to all eligible customers as justification for providing water and sewer services to the project. Knoer Reply Brief, Exhibit V at paragraphs 4(d) and (e), at Appendix C. The relevant provision of the Agreement recites:

(d) Water. Recognizing the requirements to provide water service to all eligible customers under existing applicable federal law, the City shall provide local water service to the Corporation of the Seneca Buffalo Creek Territory.

(e)Sewer. Recognizing the requirement to provide sewer service to all eligible customers under existing applicable federal law, the City shall provide local sewer service to the Corporation of the Seneca Buffalo Creek Territory.

Thus, under the Agreement, the City contracted with the Seneca Nation to provide local water and sewer service. Consistent with the Agreement, the City is providing the Seneca Nation water, sewer and emergency services. The Court now addresses Petitioners' contentions.

Petitioners argue that there is no legal obligation for the City to provide sewer and water services to the Seneca Nation. This is contrary to the language of the Agreement which mandates that the "City shall provide" the Seneca Nation with local water and sewer service. Petitioners' argument is based on an assumption that since the land is not subject to the jurisdiction of the City, that the Seneca Nation are not entitled to services provided to other citizens of the City. Petitioners' Memorandum of Law, pages 44 — 48. However, contrary to Petitioners' position, the City cannot deny the Seneca Nation services which it provides to other citizens within its jurisdiction. Chase v. McMasters, 573 F2d 1011, (8th Circuit 1978); Fallon Pauite-Shoshone Tribe v. City of Fallon, 174 FSupp2d 1088 (DNev. 2001); Shakopee Mdewakanton Sioux Community v. City of Pyer Lake, Minnesota, 771 F2d 1153 (8th Circuit 1985). Courts have determined that the conveyance of lands to Indian tribes or members thereof is done under operation of federal law and is therefore governed by the Supremacy Clause, and by extension, the Equal Protection Clause. Chase v. McMasters, supra at 1017 — 1019; Fallon Paiute-Shoshone Tribe, supra . at 1093 — 1094. To deprive the Senecas of sewer rights and water service would deprive them, not only of their contractual rights, but equal protection of law.

Here, the Agreement between the City and the Seneca Nation requires that sewer and water services will be provided to the Seneca Nation in exchange for the payment of reasonable connection and usage fees. The Court is aware that there are several federal and state owned properties within the City that have sewer and water connection, yet are not subject to the jurisdiction of the City. Because the members of the Seneca Nation are considered to be citizens of the United States ( 8 USC § 1401(b) (2006)), the City may not withhold water and sewer services. As a result, the City's decision to enter into an agreement which includes provisions for sewer and water services treats the Seneca Nation as it treats all other citizens within its boundaries.The City's contractual obligation to provide the Seneca Nation with sewer and water services was not affected by an error of law.

The City Sewer Regulations Require Connections

In addition to the requirement that the City treat all citizens within its borders equally, including the provision of public utilities, the City's own sewer and water regulations require connections. First, the Buffalo Water Board Regulations ( 21 NYCRR §§ 10085.2 — 10085.4) state that all parties located within the City's boundaries are entitled to a public water supply providing they make an acceptable application to the Buffalo Water Board. Additionally, the Buffalo Sewer Authority Sewer Use Regulations (21 NYCRR § 1075.4) require that all structures in the City of Buffalo be connected to the sewer system. In light of the foregoing, the City provides water to all within its borders subject to an application and must provide sewer connections to all structures in the City of Buffalo. As such, the City's own regulations require that water and sewer services be provided to those within its borders. Since the Seneca Nation's property is located within the boundaries of the City of Buffalo, the City's regulations also require that water and sewer service be provided. Therefore, the City was acting in accordance with its own regulations when it agreed to provide water and sewer services to the Seneca Nation. As such, Respondents' determination was not affected by an error of law.

The Common Council Did Not Rely on the Need to Provide Sewer and Water

In issuing the Negative Declaration for the Agreement, the Common Council did not rely on any obligation, express or implied, to provide sewer or water services to the Seneca Nation. (LUK000001 — 11) Simply put, no such obligation is mentioned anywhere in the eleven (11) page Common Council resolution adopting the Negative Declaration. (LUK00001 — 11)

Similarly, the Common Council's resolution approving the Agreement does not make any reference to any obligation, express or implied, to provide water and sewer services to the Seneca Nation. (LUK001533 — 1538) In fact, the "Whereas" recital clauses of this resolution provide a lengthy and extensive discussion of the many reasons in favor of approving the Agreement. Yet, there is absolutely no reference to any obligation to provide water or sewer services to the Seneca Nation. Moreover, Respondent, Byron Brown, the Mayor of the City of Buffalo, did not refer to any such obligation when submitting the Agreement to the Common Council for approval by letter dated October 12, 2006.

As referenced by this Court in the November 9 Order at pages 44 — 45:

Respondent, City of Buffalo, developed the Agreement with the Nation which embodies certain assurances for the citizens of Buffalo and Western New York relative to its operation of the Casino on the Buffalo Creek Territory. The negotiation process was challenging and negotiations broke off several times. Finally, the City and the Nation were able to negotiate an agreement that both sides determined to be in the best interests of their organizations and their constituencies. . . . Without the Agreement, the City will be forced to accept whatever casino the Nation chooses to build on the Buffalo Creek Territory without any agreement or any assurances for the citizens of Buffalo and Western New York about how that casino will be operated.

Respondents' actions in contracting with the Seneca Nation to provide water, sewer and related services was not affected by an error of law. CPLR § 7803(3). Similarly, the Court rejects Petitioners' tacit argument that the Common Council's determination with respect to providing the Seneca Nation water, sewer and related services constitutes an abuse of discretion. CPLR § 7803(3).

RELIEF

For the reasons recited herein, Petitioners' Second Amended Verified Petition is dismissed as a matter of law and judgment is granted to Respondents.

ORDER OF THE COURT

This Memorandum Decision shall constitute the Order of the Court.