BILL NUMBER: S2567A

SPONSOR: HELMING
 
TITLE OF BILL:

An act to amend the state finance law, in relation to state assistance
to certain counties in which an Indian nation is located

 
PURPOSE:

This bill provides a mechanism for the counties of Cayuga and Seneca to
receive reimbursement from New York State on a year to year basis for
property taxes that the Cayuga Indian Nation refuses to pay.  Although
these tax revenues remain uncollected, counties are required to pay
municipalities and school districts within such counties amounts equal
to-such uncollected taxes, even though such taxes have not been remitted
by certain Indian Nations. This Bill would make the counties whole for
these property tax shortfalls.

 
SUMMARY OF PROVISIONS:

              

Section 1. Amends the state finance law by adding new section 54-n -
State assistance to eligible counties in which an Indian Nation is
located. This section creates a new appropriation in the next fiscal
year which provides funds to the eligible counties of Cayuga, and Seneca
for reimbursement of monies expended by them to pay municipalities and
school districts tax revenue due from Indian Nations but unpaid by Indi-
an Nations and uncollectable by judicial proceedings.

Section 2. Contains the Effective Date - immediately.

 
JUSTIFICATION:

In a decision dated August 20, 2012, United States District Court Judge
Charles J. Siragusa granted the Cayuga Indian Nation of New York a
preliminary injunction prohibiting Seneca County from foreclosing on
certain real property owned by the Nation within the boundaries of the
64,000-acre Cayuga Indian Reservation acknowledged by the 1794 Treaty of
Canandaigua.

The Court followed the Second Circuit Court of Appeal's decision in
Oneida Indian Nation of New York v. Madison County and Oneida County,
605 F.3d 149 (2d Cir. 2010) in holding that the doctrine of tribal
sovereign immunity from suit precludes the foreclosure actions against
the Cayuga Nation.

This decision is currently being appealed by Seneca County and will take
many years before resolutions of these claims are reached.  During the
pendency of this case, counties are prohibited from foreclosing on lands
owned or recently acquired by Indian Nations.  This decision causes a
significant hardship on the affected counties.  Indian Nations are
actively acquiring properties on the open market and then claiming immu-
nity from property taxation. Regardless of whether or not property taxes
are collected from an Indian nation, counties are required by law to pay
the amount equal to those uncollected taxes to school districts and
municipalities in each county. Under this scenario counties are left
with large expenditures with no revenue to offset them. These expendi-
tures cause the taxpayers of each county to suffer a higher property tax
burden.
This Bill provides a mechanism for Cayuga County and Seneca County to
seek reimbursement from the State for these expenditures. Ultimately,
the resolution of these Indian claims is a federal matter and should be
funded by our federal government. Until, our federal government takes
responsibility for these unresolved Indian controversies, the State of
New York should bear the burden of Indian claims of immunity from taxa-
tion and provide relief to local taxpayers of this tremendous burden.

 
LEGISLATIVE HISTORY:

S.5864 of 2013/2014
S.4596 of 2015/2016

 
FISCAL IMPLICATIONS:

To be determined county by county on yearly basis.

 
LOCAL FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
Immediate.