Local News
COUNTY IDA: Officials joining legal fight against tax
IDAs statewide planning to sue state over “central services” fee
Niagara County Industrial Development Agency officials pledged Wednesday to help stop New York state from collecting a new “assessment” on IDAs.
The NCIDA board of directors approved spending up to $7,500 on joint legal action with IDAs statewide. The agencies want an injunction preventing the state treasurer’s division from pursuing fees on them for “central government services.”
NCIDA received a bill for $219,349 last month. It came without warning after a line item was inserted into the 2009-10 state budget directing the treasury division to bill IDAs.
Development agents around the state are infuriated by the assessment. According to Mark Gabriele, NCIDA counsel, it appears a 4.7 percent tax is being applied to all monies handled by IDAs in 2008, including grants awarded to third parties through the agencies and, in NCIDA’s case, casino cash that it held in reserve for Niagara County at the state’s direction.
NCIDA received no share of any grant or casino reserves, but it’s being taxed on them anyway; on a straight income basis, the agency actually lost money in 2008.
“And the best part? They’re taxing the very people whose job it is to convince outside companies to come do business in New York state,” Gabriele said. “Only in New York.”
Upwards of 50 IDAs around the state are joining in the legal action, led by counsel still to be determined, he said. Grounds will include the treasury’s lack of an explanation how it came up with the assessment, and the fact it missed the Nov. 1 deadline for alerting IDAs the tax would be imposed. The law firm that Gabriele works for, Harris Beach LLPC, is not taking the case, he added.
State Assemblyman Robin Schimminger, D-Kenmore, pledged last week to introduce a bill to repeal the assessment. It’s supposed to be a companion to a repeal bill introduced in the state Senate by Sen. David Valeski, D-Oneida.
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