Enough Is Enough! Upstate Taxpayers And Businesses Deserve Fairness And Equality Under The Law

Legislative column from Assembly Minority Leader Brian M. Kolb (R,I,C-Canandaigua)
November 3, 2010

Just in case you missed it, a controversial ruling handed down by United States District Court Judge Richard Arcara last Tuesday has effectively delayed New York’s lawful collection of hundreds of millions in taxes from cigarettes sold on Native American lands to non-Native American Indians. The judge issued a temporary two-week restraining order sought by the Seneca Indian Nation that blocked New York from moving forward with collecting these taxes, which was supposed to begin the very next day. Similarly, a State Appellate Judge also issued an order that temporarily prevented the policy from being implemented.

I believe these rulings were more than just the wrong decisions. In reality, they were nothing short of a slap in the face to every Upstate taxpayer and business owner that has played by the rules, followed the law and expected their state and federal government to do the same. I strongly disagreed with these rulings that set back years of hard work and non-partisan grassroots advocacy in support of enforcing the law, collecting these taxes and leveling the playing field for Upstate taxpayers and businesses forced to operate under a different set of rules than retailers on Native American lands. The effort I speak of has been ongoing since the United States Supreme Court decided a landmark case back in 1994 that settled all the arguments over this issue – or so we thought.


In its 1994 ruling on the Attea case, the Supreme Court held that New York State could move forward with collecting taxes on cigarettes sold on Native American lands to non-Native American Indians. Since that historic decision 16 years ago, state government regrettably has squandered numerous opportunities to deliver on the promise that all our laws would be applied and enforced equally, without fear or favor. Administrations from both parties had a hand in this, as they failed to provide the necessary oversight and, more importantly, the proper follow-through to ensure the law was upheld.

However, in recent months, it appeared that state government was finally turning the page on years of inaction and would keep its promise to Upstate. Thanks to the continued efforts and advocacy of the “Enforce the Law-Collect the Tax Coalition,” myself, Governor Paterson and the leadership of local elected officials, after years of frustrating stops and starts, New York was about to start collecting these taxes. As mentioned previously, the state was 24 hours away from beginning to collect these revenues before Judge Arcara’s ruling.

Predictions vary on how much revenue New York stands to collect. The amount ranges from $200 million on the low end, to upwards of $1 billion on the high end. This is largely because the administrative mechanism for collecting the taxes has not been fully implemented, so nobody knows exactly how much money could be generated. Nevertheless, the one thing that just about everyone does agree upon is with Albany facing an unprecedented budget crisis, these funds are needed now more than ever.


If you want to believe that the recently enacted 2010-11 State Budget made New York’s multi-billion dollar deficits and astronomical debt disappear, now would be a good time to stop reading. All that talk of “budget cuts” and “belt tightening” that certain politicians in Albany have been trumpeting? It’s as phony as the proverbial $3 bill. In fact, this year’s budget actually spends more than last year and did nothing to tackle our long-term deficit and debt problems. Without question, New York desperately needs the revenues that will be generated by enforcing the law and collecting the taxes from cigarettes sold on Native American lands to non-Native American Indians.

If all of these funds continue to go uncollected, guess where the Downstate politicians that dominate the state Legislature will look to try and make up the shortfall? Upstate taxpayers. I believe Upstate families already pay plenty and are not an ATM. Instead of increasing the burden on Upstate, we should be focusing on enforcing the law and collecting the taxes.


Delaying our state from enforcing the law and collecting the tax – whether the delay lasts for two weeks, two days, or two hours – means justice denied for Upstate, especially since the Supreme Court already gave the green light to collect the taxes back in 1994. In the wake of Judge Arcara’s decision, I again called on Senators Schumer and Gillibrand to urge the Obama administration and the Bureau of Indian Affairs to step in and resolve all these outstanding tax and land claim issues once and for all.

The reality is that Seneca and Cayuga counties have suffered long enough with endless court actions, draining legal costs and emotional distress caused by years of the back-and forth over New York collecting these taxes. Enough is enough! It’s time for the federal government to provide Upstate with some long overdue fairness and equality. Upstate taxpayers are NOT second-class citizens. The federal government needs to end its years of passivity, get involved and bring this issue to a common sense resolution. It begins by ensuring New York State can finally move forward in enforcing the law, collecting the tax and leveling the playing field without further interference. Hopefully, both Judge Arcara and the Appellate division will allow the collection of these taxes to move forward. We have come too far to turn back now.

As always, constituents wishing to discuss this topic, or any other state-related matter should contact my district office at (315) 781-2030, or e-mail me at kolbb@assembly.state.ny.us. You also can follow me on Facebook and Twitter for the latest news and informational updates regarding state government and our Assembly Minority Conference.