I'm Making The Trip Back To Albany

I've been invited to be on The Capitol Pressroom with Susan Arbetter again. Ms. Arbetter told me she has learned more about our battle with the state on my two appearances than she has learned in all her years of covering the issue with other guests. As such, she is having me back on Thursday, June 2nd. The show will be following a hearing on the 1st in Buffalo that may or may not clear the way for the New York State to prohibit its licensed wholesalers from selling unstamped/untaxed cigarettes to Native wholesalers and retailers on Native lands. This move will undoubtedly put several state licensed wholesalers out of business and cause Native retailers to shift from what is now between 80 to 90% of their sales to 100% being Native brands. The state will essentially be prohibiting their licensed wholesalers from carrying Native brands because they cannot bear the state's tax stamp so the distribution of those brands will return back to Native distributors and wholesalers. The New York State Department of Taxation and Finance knows their weak legal arguments stop well short of allowing them to interfere with the Native to Native trade of a Native produced product. This will likely be the dominant theme of the conversation on The Capitol Pressroom.

Adding to the drama is the call from two state senators from both major parties for the tax department to put in writing their intentions regarding Native brands. Their phone calls to the taxation department got them a response from the department officials that this falls into a "gray area". The senators stated clearly in a letter to Thomas Mattox, the NYSDTF Commissioner that they not only didn't agree with that assessment but that it was unacceptable. They told the commissioner that the state had no authority to infringe on Native to Native commerce and that doing so would be harmful the Native people and the entire regions in which they live. The senators insisted that New Yorkers and their elected representatives had a right to to know what the department was up to and that their position should be put in writing so that their intentions would be clearly known.

The letter was dated May 16, 2011 and as yet the NYSDTF has failed to respond. It is amazing that a plan by the state that has literally been in the works since 1988 still leaves the state's tax officials stumped to answer such basic questions. Between a potential court ruling on June 1st and, perhaps, a response from the NYSDTF to some fairly adamant senators, Thursday's Capitol Pressroom should be a good one. The show is carried throughout the state on NPR stations so check your local listings for the airing times in your area.

Another Good Showing in Albany

My appearance on The Capitol Pressroom went well. Jim Calvin of the New York Association of Convenience Stores was pretty easy to put away in my debate. Of course, he was at a huge disadvantage. He only had the same old talking points that our opponents have been spewing for over twenty years. The only things that anyone heard to shine a light on the issue came from me. But beyond me correcting his exaggerated interpretations of court cases and calling out his twisted view of what a level playing field is, was another interesting conversation on the show. This one was between the shows host, Susan Arbetter and the New York State Budget Director, Robert Megna on the segment before debate with Calvin.

Susan Arbetter told Robert Megna that I claimed the state was intent on shutting down our tobacco retail businesses and that to do so they plan to outlaw Native brands and to actively stop the legal distribution of those brands. She asked, "Is this the case or not?" Mr. Megna's response was, "You know...I don't think so....I mean, I haven't heard that. We know that the Native Americans produce or have begun producing their own brands of cigarettes, but I think what we have said, the State of New York has said for many years, is that we want to collect the money paid on cigarettes that were not produced by the Native Americans that are being sold by the Native Americans to New Yorkers tax free. Um...it's as simple and straight forward as that. I think the Governor's office and the Tax Department have developed a rational plan for doing that which does not involve the State infringing on the territories of Native Americans but rather working through wholesalers and saying that if you are going to sell...,you know...um, manufactured cigarettes...That all cigarettes have to have a stamp on them to ensure that those that are being sold to New Yorkers, the tax has been paid and that an allocated amount will go to Native Americans for their...for their purposes that will be tax free. This has been our policy for a long time."

This was the first indication from the State that they realize the lines they would have to cross to prohibit Native brands. As I have said repeatedly, the State has only two choices under its current law when it comes to Native brands. They can't stamp them so they must either acknowledge, as they have in the past, that they have no authority to regulate Native brands sold on our land or they will have to fight us to to kill them. According to Mr. Megna, the State may be once again looking away.

Check the side bar of my blog or go to http://thecapitolpressroom.org/the-capitol-pressroom-for-may-11-2011/ to hear the State's Budget Director and my segment with Jim Calvin.

White Men In Black Robes Do It To Us Again

ATTORNEY GENERAL SCHNEIDERMAN WINS SECOND CIRCUIT CASE TO COLLECT TAXES FROM NON-TRIBAL MEMBERS ON INDIAN RESERVATIONS

News from Attorney General Eric T Schneiderman

FOR IMMEDIATE RELEASE May 9, 2011
New York City Press Office / 212-416-8060Albany Press Office / 518-473-5525https://alb-me3.oag.lawnet/owa/NYAG.PressOffice@ag.ny.gov/UrlBlockedError.aspx


ATTORNEY GENERAL SCHNEIDERMAN WINS SECOND CIRCUIT CASE TO COLLECT TAXES FROM NON-TRIBAL MEMBERS ON INDIAN RESERVATIONS

Court's Unanimous Decision Allows for the Collection of Hundreds of Millions of Dollars in Tax Revenue

Schneiderman: Today’s Decision Respects Tribal Rights and at the Same Time Represents an Important Victory for the State to Collect Deserved Revenue and Protect Public Health

NEW YORK - Attorney General Eric T. Schneiderman today announced that the United States Court of Appeals for the Second Circuit issued a unanimous decision upholding the authority of New York State to collect taxes on cigarette sales made on reservation land to non-Indian Tribe members. The Second Circuit recognized that New York’s law carefully balances the interests of Tribal sovereignty with the State’s legitimate interests in taxing all cigarette sales made to non-Tribal members. The State estimates that the decision will enable the State to collect approximately $500,000 per day in additional tax revenue.

"Today’s decision respects Tribal rights and at the same time represents an important victory for the State to collect deserved revenue and to protect public health," said Attorney General Schneiderman. "The decision closes an enormous tax-evasion loophole that was depriving New York of hundreds of millions of dollars in tax revenue. I'd also like to commend all of the attorneys in the Attorney General's office whose extraordinary efforts on this case helped us achieve the best outcome for New Yorkers."

In 2010, the New York State Legislature passed a law requiring the collection of cigarette taxes on cigarette sales to non-Tribal members. The law provided Indian Tribes with several options for collecting those taxes while ensuring that cigarette sales to qualified Tribal members would remain tax free. The law is important for protecting the public health of New Yorkers as well as raising hundreds of millions of dollars in revenue during a time of economic hardship.

The law was intended to go into effect on September 1, 2010. However, in August 2010, several Indian Tribes sued the State in federal district court to enjoin enforcement of the new law. The Tribes asserted that the law violated their tribal sovereignty and caused them irreparable harm. Two federal trial courts stayed the enforcement of the law. The New York Attorney General’s Office filed an expedited appeal with the United States Court of Appeals for the Second Circuit.

Today's unanimous decision accepted the arguments made by Attorney General Schneiderman. The Second Circuit determined that under settled United States Supreme Court law, the Tribes have no likelihood of success on the merits. Accordingly, the Second Circuit vacated all orders staying enforcement of New York’s tax law.

Deputy Solicitor General Andrew D. Bing argued the case for the Attorney General's office. Special Counsel to the Solicitor General Alison Nathan and Assistant Solicitor General Steven C. Wu also handled the case, all under the supervision of Solicitor General Barbara D. Underwood. The initial case was also handled by Assistant Attorneys General Robert Siegfried, David Roberts and Darren Longo.