Senate Bill S2257

                                
 
BILL NUMBER: S2257

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. Establishes the effective date

 
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 immunity 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 expenditures 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:

2020: S. 269 referred to Finance

2019: S. 269 referred to Finance

2018: S.2567-A referred to Rules

2017: S.2567-A passed Senate

2016: S.4596 referred to Finance

2015: S.4596 passed Senate

2014: S.5864 passed Senate

2013: S.5864 passed Senate

 
FISCAL IMPLICATIONS:

To be determined county by county on yearly basis.

 
EFFECTIVE DATE:
Immediately