Construction at both the Seneca Allegany Casino in Salamanca and Seneca Buffalo Creek Casino in Buffalo will cease, report Seneca Gaming Corp. officials Wednesday.

Corporation officials report the decision to cease construction was made “in light of various factors“ including “challenging economic and capital market conditions, greater demands on the company’s available cash and increased competition and construction costs.“

The corporation, a subsidiary of the Seneca Nation of Indians, consulted the nation before making the decisions. In a news release, the company said it will evaluate various options and the appropriate timing to continue expansion plans on the Allegany and Buffalo Creek territories.

“We have kept a close eye on the state of the economy and the impact it has continued to have on every person and every industry across the country,“ said Barry E. Snyder Sr., Seneca Gaming Corporation chairman. “In keeping with our financial commitments to our owner, the Seneca Nation of Indians, and with our obligations to our bondholders, we have decided that it is our responsibility to suspend our construction activities at this time, as we endeavor to preserve the continuing strength and vitality of our company. We look forward to resuming and completing construction of these two world-class projects at the appropriate time.“

The corporation had been erecting steel for the USD 130 million hotel expansion at Seneca Allegany Casino & Hotel in Salamanca to accommodate a second hotel tower with an additional 200 rooms that were to open in mid-2009. The current facility is 11 stories high and already has 220 rooms.

Construction at the USD 333 million permanent Seneca Buffalo Creek Casino in Buffalo will also be halted. The company operates a temporary casino at the site and was building a permanent one. Although a recent court ruling by U.S. Federal District Court Judge William Skretny compelled the National Indian Gaming Commission to close the facility, the temporary one will continue to operate, report nation officials. They said the ruling does not have anything to do with stopping construction, which has been being considered for some time due to the economy.

Federal officials said Wednesday they have 60 days to file an appeal to a ruling Tuesday by Judge Skretny if other action is not taken. They have not yet decided whether they will appeal the Tuesday ruling.

Existing operations at Seneca Allegany and Seneca Buffalo Creek will not be affected by the suspensions, nor will the operation of the company’s flagship facility, Seneca Niagara Casino & Hotel in Niagara Falls, report gaming corporation officials.

“Seneca Gaming Corporation has established itself as a dynamic and growing presence in the gaming industry and in the Western New York economy, and we expect that to continue,“ said Brian Hansberry, Seneca Gaming Corporation president and chief executive officer.

About 4,200 people are employed at the company’s facilities in Niagara Falls, Salamanca and Buffalo. The three casinos consist of more than 6,500 slot machines and 140 table games as well as 800 hotel rooms and other related amenities.