A lucrative business employing thousands of people and contributing greatly to the area's economy is in jeopardy of closing its doors, a township politician has warned.

Ramara Mayor Bill Duffy says that Casino Rama will cease to exist within six years unless Ontario's First Nation communities resolve an ongoing dispute over gaming revenues.

"If there isn't co-operation between the major players and the province, there will be an empty building there in 2011," Duffy told Business Times.

Conflicting reports over the casino's future are leading to serious unrest within the community, and have the potential to drive away future investment in the area, Chief Sharon Stinson Henry said.

"It is poisonous and it is causing uncertainty," she added.

Earlier claims by Mnjikaning First Nation that the province was considering closing the casino were refuted as untrue by a representative of the Ontario Lottery and Gaming Corporation.

But according to Duffy, a recent talk with the agency's CEO, Duncan Brown, only confirmed fears expressed by the native community northeast of Orillia.

Duffy said he and Orillia Mayor Ron Stevens were told the popular casino would close unless Mnjikaning and other First Nations resolve a long-running dispute over the current revenue-sharing formula. The band also disputes the 20 per cent "win contribution" paid to the province from gross revenues, Duffy noted. "There is a lot of frustration on (Brown's) part with the lack of co-operation from the major players," he added.

Stevens disputed the allegation that Brown had threatened to close the casino.

"What he clearly told us was, is that it is their intention to work towards resolving this with the best solution that would benefit everyone concerned," he said.

"That is the message that should be going out." Stevens did, however, impress upon Brown the casino's dual role as an employer and corporate citizen. "We as a city would be severely impacted if that casino were to close."

Stinson Henry said the band was told the casino could face closure during a meeting with Brown in late January, only to later hear through the press that the government denied having considered such a plan.

"I don't understand how (Brown) can have the gall to say one thing to various people and then come out with a public statement that ... they have no intention of closing Casino Rama," she said.

"Casino Rama is an economic engine in this region," she added. "We cannot afford to have this kind of waffling, saying one thing to one group and saying another thing to another group