Counties wants nation's highest court to decide whether LakeSide Trading stores are on reservation land.
The Lakeside Trading Store on Route 89 in the town of Seneca Falls was open selling cigarettes in this photo from Jan. 30, 2009, after a court ruling that the nation didn't have to pay taxes on its cigarette sales. Cayuga and Seneca counties plan to ask the nation's highest court to rule on whether the stores are on reservation land.“This action represents a responsibility to protect and defend the economic equality of our business community and the hardworking citizens that we were elected to serve,’’ Robert Shipley, chairman of the Seneca County Indian Affairs committee, said in a release.
Last month, the state Court of Appeals sided with the Cayugas in the tax dispute. The state’s highest court ruled the counties could not prosecute the nation for selling tax-free cigarettes to non-Indians at its LakeSide Trading stores in Union Springs and Seneca Falls because the stores are on qualified reservation land under state tax law.
In its decision, the appeals court also sided with the nation because it said there is no state system in place to collect the tax.
Shipley said the reservation issue is the basis for the counties’ decision to take the case to the nation’s highest court. He said the counties believe the state appeals court erred in its ruling that the stores lie on reservation land. The counties maintain that the land, which comprises part of the Cayugas’ original homeland, is not a reservation under federal law.
Daniel French, a Syracuse lawyer representing the nation, said the counties would be better off trying to negotiate a settlement rather than spend more local tax dollars on fighting the court decision.
“For people who claim to be against gaming they sure seem willing to gamble taxpayers’ dollars on a proposition with almost zero chance of success,’’ French said.
The counties, both of which oppose Indian gaming, had 90 days from the appeals court ruling on May 11 to ask the Supreme Court to hear the case. However, there is no guarantee the top court will take the case. The Supreme Court reviews about one in every 100 cases that it is asked to consider for appeal, according to officials.
“The Court of Appeals ruled on a matter of New York state tax law, not the kind of issue the Supreme Court is apt to weigh in on,’’ French said.
The counties have tried for years to legally block the Cayugas from selling tax-free cigarettes because they say it gives the nation an unfair competitive edge over non-Indian businesses that have to collect the tax and charge higher prices.
“The future economic welfare of Seneca and Cayuga counties rely on the commonsense of judges unwilling to circumvent the U.S. Constitution,’’ Shipley said.
You can reach Scott Rapp at srapp@syracuse.com or 289-4839