From the Morning Memo:

Moody’s Investors Services said last week’s resolution in an arbitration between the state and the Seneca of Nation of Indians will have a positive financial impact on three Western New York cities.

The arbitration panel ruled the Senecas must continue to pay the state a percentage of the nation’s slot machine revenues, as well as nearly two years of back payments. Buffalo, Niagara Falls and Salamanca will all receive funding they have been due but were not receiving while this battle was being waged.

Of the three cities, Niagara Falls was in the worst financial shape, with a negative rating from Moody’s. While, the rating service’s declaration of “credit positive” does not automatically mean there will be an imminent credit rating or outlook change, it is a recognition of a significant event for the city.

“In particular, the ruling will greatly improve the financial position of the City of Niagara Falls (Baa3 negative), which relies heavily on Seneca Nation revenue-sharing funds to support operations,” the report reads.

Moody’s noted Salamanca also relies heavily on the funding, but was in a better financial position than Niagara Falls at the outset of this prolonged fight. The service pointed out that only some of the lost casino revenue could be made up from a property tax increase, so cuts would’ve been needed had the arbitration not ended up the way it did.

“Had the Seneca Nation won the arbitration and refused to make payments to these cities going forward, both cities would have faced significant financial uncertainty,” Moody’s said.

The report said even though the amount of money Buffalo received was small compared to the city’s total budget, it had still “struggled to maintain balanced operations, and any loss of recurring revenue can be difficult to absorb.”