State should prosecute to collect sales and excise fees, Senate majority leader says
By JAMES M. ODATO, Capitol bureau First published: Wednesday, January 30, 2008
ALBANY -- Senate Majority Leader Joseph L. Bruno on Tuesday called for the state to prosecute American Indian retailers and others for failing to pay some $1 billion in sales and excise taxes. Speaking at the annual meeting of the New York Association of Counties, and later to reporters, Bruno said Gov. Eliot Spitzer must enforce state law and collect the taxes to help the estimated $4.4 billion budget gap.
"How do you collect taxes? If people don't pay taxes they end up getting prosecuted," Bruno said. "I mean if you don't pay your taxes, if your company doesn't pay ... what'll happen?"
Later, after flanking Bruno during a news conference, Attorney General Andrew Cuomo declined to say who should prosecute tribal enterprises.
"It depends on what the state is doing," Cuomo said. He said he wanted someone to check into Bruno's comments.
Cuomo spokesman John Milgrim later said it would be inappropriate to comment because the attorney general may have to defend the state in a lawsuit.
Assemblyman David Townsend, R-Sylvan Beach, said he will file a suit this week against Spitzer and Tax Commissioner Robert Megna in state Supreme Court in Albany County to get an order requiring tax law enforcement on the Indian enterprises.
An Oneida Nation spokesman declined to comment on the suit or Bruno's comments.
Bruno said he supported a "great resolution" from the association. It directs the Spitzer administration to "take any and all necessary action to insure collection of all sales and excise taxes on tribal and Indian sales of all goods and services to non-tribal members ... without further delay."
Bruno said: "Governor, go get the tax money on behalf of the people of this state. ... There's about $1 billion out there."
Spitzer's legal counsel, Richard Rifkin, told a committee of the association on Monday that the issue is complicated and he wouldn't speculate on how it will be resolved.
The governor put $200 million in his budget plan for this year from Indian tax collections. His budget plan for next year calls for $174 million.
The holdup has been the Department of Taxation and Finance's failure to issue coupons so that tribal members can continue to buy tax-free cigarettes and other products. People who are not tribal members would have to pay the taxes.
Town of Lenox Board Supervisor Rocco DiVeronica, the past chairman of the association's Native American Affairs Committee, said he appreciates Bruno's support but questioned his ties with the leader of the Oneida Indian Nation, Ray Halbritter. Bruno walked one of the Oneidas' professional-level golf courses last year with Halbritter, whose tribe has contributed $430,000 to Senate and Assembly campaign committees since 1999.
"There's a disconnect between state and local government officials," DiVeronica said.
Spitzer told the association his new budget would save counties $519 million. But several county leaders and Association Executive Director Steve Acquario said Spitzer overstated the state's help. They said Spitzer's budget will push $75 million to $80 million onto counties for costs of juvenile detention and welfare.
The governor, Acquario said, was counting Medicaid costs borne by the state since the Pataki administration capped local costs for the government health care program.
Paul W. Miller, Madison County's assistant director of planning, and Oneida County Executive Anthony J. Picente Jr., complained that Spitzer failed to account for sales tax revenues counties aren't getting from Indian businesses, as well as lost property taxes not paid on Oneida-owned acreage.
Spitzer spokesman Errol A. Cockfield Jr. said that if county executives say they have to raise taxes, it will be "because of their own choices, not because of the New York state budget. They are threatening tax increases at a time when the public is feeling squeezed, despite increased state aid that makes doing so unnecessary."
Odato can be reached at 454-5083 or by e-mail at firstname.lastname@example.org.