Bill S4679-2013

Relates to the definition of qualified reservation

Relates to the definition of Indian reservation; ties such term to certain treaties.

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  • Jan 8, 2014: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • Apr 18, 2013: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Memo

BILL NUMBER:S4679

TITLE OF BILL: An act to amend the tax law, the Indian law and the real property tax law, in relation to the definition of "qualified reservation"

PURPOSE: To clarify that Indian nations are only exempt from the payment of sales taxes on cigarettes purchased for their own use on reservations where they exercise sovereignty over such lands and that only such lands are exempt from the payment of real property taxes.

SUMMARY OF SPECIFIC PROVISIONS: This bill amends subdivision (16) of Section 470 of the Tax Law to eliminate from the definition of a "qualified reservation" lands held by an Indian nation or tribe that are located within the reservation of that nation or tribe within the state and instead provides that the term "qualified reservation" be limited to lands within the state over which an Indian nation lawfully exercises tribal sovereignty or lands over which the Indian nation or tribe exercises governmental power and that are either: held by the nation subject to restrictions by the United States against alienation pursuant to the Seneca Nation (New York) Land Claims Settlement Act (25 U.S.C. 1774 et seq.); or held in trust by the United States for the benefit of such Indian nation. The bill also amends Section 6 of the Indian Law and Section 454 of the Real Property Tax Law by defining "Indian reservation" to be consistent with the definition of "qualified reservation" in Section 470 of the Tax Law.

JUSTIFICATION: In 2010, the New York Court of Appeals issued its decision in CAYUGA INDIAN NATION OF NEW YORK V. CAYUGA COUNTY wherein it reaffirmed the Appellate Division 4th Department's 2009 ruling that the Cayuga Nation did not have to collect the sales tax on cigarettes sold to non-Indian consumers at two stores located on their aboriginal land. Specifically, the Court ruled that despite the fact that the Cayuga Nation has no present reservation in the state, the properties involved met the statutory test under the Tax Law of being a qualified reservation (wherein the state is without power to impose a tax on sales to Indians) because their reservation, established by a treaty in 1789 and further acknowledged by the treaty of Canandaigua in 1794, was never disestablished by Congress. Thus, the Court ruled that the two Cayuga Nation stores were located on reservation land even though the Nation exercised no sovereign control over them. Ultimately, only Congress or the United States Supreme Court can settle the issue concerning the ramifications of a Native American nation acquiring real property in an unrecognized but also un-disestablished reservation, Until that occurs, this bill would require that real property owned by a nation could only be deemed a qualified reservation under support for the bill's provisions can also be found in the 2005 decision of the Supreme Court of the United States in CITY OF SHERRILL V. ONEIDA INDIAN NATION OF NEW YORK which held that the Oneida do not exercise sovereignty in whole or in part over parcels they recently purchased on the open market and that such parcels are subject to real property taxes. The holding in SHERRILL applies not only to the specific parcels within the City of Sherrill at issue but also to lands recently purchased by the Oneida within their historic reservation of 250,000 to 300,000 acres. The principle of SHERRILL applies equally to lands recently purchased by other New York tribes. Nevertheless, the Oneida have refused to pay real property taxes and

have argued that these parcels are exempt from such taxes under Section 6 of the Indian Law and Section 454 of the Real Property Tax Law because in the historic reservation has not been "disestablished." In 2010, the Supreme Court of the United States granted certiorari on two questions, including "whether the ancient Oneida reservation in New York was disestablished or diminished." After the Oneida passed a tribal declaration and ordinance waiving "its sovereign immunity to enforcement of real property taxation through foreclosure by state, county and local governments," the Supreme Court vacated the judgment of the Second Circuit and remanded the case to that court, where it is still pending. This bill would provide that real property owned by an Indian nation or tribe could be deemed an "Indian reservation" under the Indian Law and under the Real Property Tax Law only if that tribe or nation lawfully exercises tribal sovereignty over such real property, or that property is (1) either held by the nation or tribe subject to restriction by the United States again alienation pursuant to the Seneca Nation (New York Land Claims Settlement Act (25 U.S.C. 1774 et seq.); or(2) held in trust by the United States for the benefit of such nation or tribe as set forth in the bill.

PRIOR LEGISLATIVE HISTORY: 2011: S.3866

FISCAL IMPLICATIONS: Could result in a minimal increase in sales tax collection from any affected stores.

EFFECTIVE DATE: Immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 4679 2013-2014 Regular Sessions IN SENATE April 18, 2013 ___________
Introduced by Sen. NOZZOLIO -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Govern- ment Operations AN ACT to amend the tax law, the Indian law and the real property tax law, in relation to the definition of "qualified reservation" THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 16 of section 470 of the tax law, as added by section 1 of part K of chapter 61 of the laws of 2005, is amended to read as follows: 16. "Qualified reservation." (a) Lands [held by an Indian nation or tribe that is located within the reservation of that nation or tribe in the state] WITHIN THE STATE OVER WHICH AN INDIAN NATION OR TRIBE LAWFULLY EXERCISES TRIBAL SOVEREIGNTY; (b) Lands within the state over which an Indian nation or tribe exer- cises governmental power and that are either (i) held by the Indian nation or tribe subject to restrictions by the United States against alienation PURSUANT TO THE SENECA NATION (NEW YORK) LAND CLAIM SETTLE- MENT ACT (25 USC 1774 ET SEQ.), or (ii) held in trust by the United States for the benefit of such Indian nation or tribe PURSUANT TO THE INDIAN REORGANIZATION ACT (25 USC 461 ET SEQ.); (c) Lands held by the Shinnecock Tribe or the Poospatuck (Unkechauge) Nation within their respective reservations; or (d) Any land that falls within paragraph (a) or (b) of this subdivi- sion, and which may be sold and replaced with other land in accordance with an Indian nation's or tribe's land claims settlement agreement with the state of New York, shall nevertheless be deemed to be subject to restriction by the United States against alienation. S 2. Section 6 of the Indian law is amended to read as follows: S 6. Exemption of reservation lands from taxation. 1. No taxes shall be assessed, for any purpose whatever, upon any Indian reservation in
this state, so long as the land of such reservation shall remain the property of the nation, tribe or band occupying the same. 2. FOR THE PURPOSES OF THIS SECTION, "INDIAN RESERVATION" MEANS: (A) LANDS WITHIN THE STATE OVER WHICH AN INDIAN NATION OR TRIBE LAWFULLY EXERCISES TRIBAL SOVEREIGNTY; (B) LANDS HELD BY AN INDIAN NATION OR TRIBE SUBJECT TO RESTRICTIONS BY THE UNITED STATES AGAINST ALIENATION PURSUANT TO THE SENECA NATION (NEW YORK) LAND CLAIMS SETTLEMENT ACT (25 USC 1774 ET SEQ.); (C) LANDS HELD IN TRUST BY THE UNITED STATES FOR THE BENEFIT OF SUCH INDIAN NATION OR TRIBE PURSUANT TO THE INDIAN REORGANIZATION ACT (25 U.S.C. 46, ET SEQ.); OR (D) LANDS HELD BY THE SHINNECOCK TRIBE OR THE POOSPATUCK (UNKECHAUGE) NATION WITHIN THEIR RESPECTIVE RESERVATIONS. S 3. Section 454 of the real property tax law is amended to read as follows: S 454. Indians. 1. The real property in any Indian reservation owned by the Indian nation, tribe or band occupying them shall be exempt from taxation and exempt from special ad valorem levies and special assess- ments to the extent provided in section four hundred ninety of this chapter. 2. FOR THE PURPOSES OF THIS SECTION, "INDIAN RESERVATION" MEANS" (A) LANDS WITHIN THE STATE OVER WHICH AN INDIAN NATION OR TRIBE LAWFULLY EXERCISES TRIBAL SOVEREIGNTY; (B) LANDS HELD BY AN INDIAN NATION OR TRIBE SUBJECT TO RESTRICTIONS BY THE UNITED STATES AGAINST ALIENATION PURSUANT TO THE SENECA NATION (NEW YORK) LAND CLAIMS SETTLEMENT ACT (25 USC 1774 ET SEQ.); (C) LANDS HELD IN TRUST BY THE UNITED STATES FOR THE BENEFIT OF SUCH INDIAN NATION OR TRIBE PURSUANT TO THE INDIAN REORGANIZATION ACT (25 U.S.C. 46, ET SEQ.); OR (D) LANDS HELD BY THE SHINNECOCK TRIBE OR THE POOSPATUCK (UNKECHAUGE) NATION WITHIN THEIR RESPECTIVE RESERVATIONS. S 4. This act shall take effect immediately.

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