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Mar 24, 2010 2:39 PMPublication: The Southampton Press

Southampton Town Board considers joining lawsuit against MTA

Editor's Note: This story has been updated to reflect the version that ran in The Southampton Press-Western Edition on March 25.

The story was updated again, on March 26, to reflect the fact that the Town Board authorized the town attorney to initiate litigation.
Mar 24, 2010 2:39 PM

Three Southampton Town Board members want to make the town a plaintiff in a lawsuit contending that the Metropolitan Transportation Authority payroll tax is unconstitutional.

In a statement released on March 17, Town Board members Chris Nuzzi, Jim Malone and Nancy Graboski urged the town’s involvement in a lawsuit filed in New York State Supreme Court last December by businessman William Schoolman, the owner of two Long Island bus companies. The lawsuit does not seek a specific amount of damages but argues that a new payroll tax approved by Albany in May 2009 violates state law and the state constitution.

When reached on Friday, Mr. Nuzzi expanded that statement to say that the town might choose to file a separate lawsuit instead of joining Mr. Schoolman’s litigation. “We’re exploring what legal options are available to us, with the end result, hopefully, being that this tax gets rescinded,” said Mr. Nuzzi, who is spearheading the initiative.

The tax, which took effect last September, was designed to help pay off soaring deficits in the MTA budget and currently requires employers in the 12 counties that are part of the MTA system, including Suffolk County, to pay 34 cents for every $100 in payroll.

The three Town Board members said in the joint statement that the payroll tax was burdening local businesses amid a constricting economy, and was hurting Southampton taxpayers, who lose money when the town pays its share.

“The Town of Southampton, on behalf of its residents and businesses, needs to fight this tax more aggressively,” Mr. Nuzzi said in the prepared statement. “We’re in a recession, laying off employees and trying to reduce costs. But the MTA just took another $50,000 from the Southampton taxpayer.”

To date, Southampton Town has paid nearly $47,000 toward the new tax since its inception, according to Ryan Horn, a legislative aide for the town.

East End politicians have spoken out vehemently against the tax since its approval, arguing in a series of statements, public hearings and press conferences that the region is paying more money and still receiving paltry train service.

“We don’t use their services, but they take our money anyway,” Ms. Graboski said in last week’s statement.

Mr. Schoolman, who owns Hampton Luxury Liner and Classic Coach, named a number of state agencies and officials as defendants in his lawsuit, and contends that Albany approved the tax in violation of its own laws and constitutional requirements. The suit also charges the MTA with “fiscal irresponsibility.”

An MTA spokesman said the agency had no comment about Mr. Schoolman’s lawsuit, or the prospect of a Southampton Town lawsuit.

The Town Board will need to pass a resolution in order to join Mr. Schoolman’s lawsuit or file its own litigation, according to Mr. Horn. He said the council is likely to first discuss the idea in executive session in the coming weeks.

Mr. Nuzzi said board members broached the topic in a work session last Thursday, March 18, but could not comment on the discussions. He said that he hopes to put forward a resolution “within the next several weeks.”

New Town Councilwoman Bridget Fleming said she supports the push to fight the tax, and wants to explore the town’s legal options. “I am completely supportive of whatever is going to be successful in fighting this onerous tax,” she said. She explained that litigation can be “very expensive,” and said she wants to pursue the most cost-effective strategy.

Supervisor Anna Throne-Holst could not be reached this week to find out where she stands on the issue.

Mr. Schoolman, meanwhile, said he was encouraged by the support of the three Town Board members. “I think it’s a terrific move,” he said. “Because it shows how it’s hurting everybody and the seriousness of it.”

In February, New York Governor David Paterson announced that he will try to cut the payroll tax for employers outside New York City by half, lowering the rate to 17 cents per $100 in payroll, and raise the tax rate for businesses within New York City to 54 cents per $100. The change is intended to spread out the tax burden in proportion with the levels of MTA service. That proposal would require approval by the State Legislature, along with the rest of the 2010-11 budget this spring.

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Mr. James, you're reporting on March 24 about a statement released a week earlier, on March 17, which strikes me as running a little late, but that's not the point. The point is that your piece ignores the Town Board meeting that took place on March 23, at which I believe all five members, including Supervisor Anna Throne-Holst and new Councilwoman Bridget Fleming, expressed support for the objectives of this lawsuit against the MTA tax.
That's my recollection of the meeting, but I'm sure ...more
By Turkey Bridge (1979), Quiogue on Mar 24, 10 12:07 PM
you should spend some time around town hall and open your eyes at to what happens outside of town board meetings.
By ridiculous (214), hampton bays on Mar 26, 10 7:50 PM
I don't understand. I know that if I follow Town Board meetings closely, I'm doing more than ninety-plus per cent of citizens do. What more do I have to do? I come to Town Hall to watch my Town Board do its job, no more and no less. If that exercise isn't enough to keep me informed, then the apparatus is badly broken.
By Turkey Bridge (1979), Quiogue on Mar 27, 10 5:29 PM
OK, Mr. James, since I commented earlier today, you've posted the rest of the article in place of the usual (justified) suggestion to buy the paper and read it there. In this later part, you at least refer to Ms. Throne-Holst and Ms. Fleming, but you're still behind the events because you don't make any reference to last night's Town Board meeting. Anna Throne-Holst's comments at that meeting show where she stands,and render obsolete your statement that she "could not be reached this week to find ...more
By Turkey Bridge (1979), Quiogue on Mar 24, 10 9:02 PM
Sounds great. What will the lawsuit cost????? Who pays the bill?????
By nellie (451), sag harbor on Mar 24, 10 10:41 PM
MTA tax another great idea from the democrats.
By reg rep (408), Southampton on Mar 24, 10 11:18 PM
MTA = Metropolitan Taxing Authority?? All they do is charge us taxes and provide NO SERVICE in return. Peconic County needs to start NOW by seceding from the MTA. You want a green initiative, no traffic, happy residents? PROVIIDE A REAL PUBLIC TRANPORTATION SYSTEM. The TIME IS NOW. if you build it, they will come. DITCH THE MTA and use the money we pay them now to start our own light rail system. Please, someone in authority take this issue seriously and be a pioneer to save the east end ...more
By eagleeye (81), Sag Harbor on Mar 25, 10 9:05 PM
1 member liked this comment
let the users of the service pay for it! I've never taken the bus and the last time I was on the LIRR was over 15 years ago, I fail to see why a business owner who receives no service or benefit rom the MTAshould pay anything at all .
By bigfresh (4661), north sea on Mar 27, 10 5:48 PM
Can we use the funds from the MTA tax to pay for the lawsuit?
By nellie (451), sag harbor on Mar 27, 10 6:32 PM
Nothing like the MTA having us pick up the tab for their fiscal negligence!

And frankly, I always thought one lane in, two lanes out was a nice, subtle hint. Well, now we have four, and our resources have become more inadequate. Nothing can change the fact that what we live in here is a confined space, which really can only sustain a certain number of people.

And, P.S., stop feeding the strays, and maybe they'll leave...
By Mr. Z (11816), North Sea on Mar 30, 10 8:08 PM
Mr. Z: "stop feeding the strays, and maybe they'll leave ..." What do you mean by that?
By Turkey Bridge (1979), Quiogue on Mar 31, 10 1:34 PM