Cayuga County to appeal decision allowing Indians to sell tax-free cigarettes


Cayuga County is not giving up easily.

County lawmakers voted 14-1 Tuesday night to appeal Friday’s ruling in which a state appellate court said the Cayuga Indians can resume selling tax-free cigarettes online buy at their stores in Union Springs and Seneca Falls without fear of being criminally prosecuted.

The appeal would be heard by the state’s highest court, the Court of Appeals.

“I believe this is the right decision. We can’t put the small businesses that compete in this competitive world … and put them at any disadvantage,” county Legislature Chairman Peter Tortorici, R-Auburn, said.

Lawmakers voted to appeal the court decision after meeting with attorneys behind closed doors in executive session for about 50 minutes.

The county’s decision comes one day after the Indian nation made an offer to end the tax dispute with Cayuga and Seneca counties. The Cayugas said if both counties would agree not to appeal the court ruling, the nation would forego suing the counties for millions of dollars in damages and lost income.

The nation also offered to pay some $180,000-plus in legal bills incurred by the counties since they raided the Cayugas’ LakeSide Trading stores and seized some $500,000 worth of unstamped cigarettes on Nov. 25.

The counties still hold the cigarettes as evidence in their criminal tax-evasion cases against the Cayugas. However, the appellate court said the Cayugas can sell tax-free cigarettes because their stores — which lie on former ancestral land — are on qualified reservation land. The court also said the counties can not pursue criminal charges against the Cayugas.

Tortorici said county officials never received a formal offer from the Cayugas. The county only heard about it through media reports, he said. “If they made an offer to pay that, then they should pay their taxes,” Tortorici said.

Syracuse lawyer Daniel French, who represents the Cayugas, criticized the county’s decision.

“The Cayuga Nation is confident this decision will be good for lawyers and bad for taxpayers,” French said. Democratic Minority Leader Daniel Schuster, of Auburn, cast the only dissenting vote. Schuster said he opposed the tax raid and attempt to prosecute the Cayugas for tax evasion from the onset.

“I don’t think the whole case is a prudent use of tax dollars. … I voted against continuing now because I don’t think we should be spending any more money in this direction,” Schuster said.

County District Attorney Jon Budelmann said he was pleased with the decision to appeal the court ruling while Aurelius Republican Raymond Lockwood said he believes the dispute is as much about sovereignty issues as it is about taxes.

“The loss of tax base — both property and sales taxes — would be forever and forever. Once (the Cayugas) get a foothold, they could open other kinds of businesses — even a big-box store and that could also be exempt,” Lockwood said.


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