Due to Superstorm Sandy, the state Department of Taxation and Finance has extended some of its tax filing and payment deadlines, including one to file “protective claims” in case the Metropolitan Commuter Transportation Mobility Tax is ever ruled unconstitutional, The Journal News/Lohud.com reports today.
The first payment for the Metropolitan Transportation Authority payroll tax was due three years ago today. Originally, today was the deadline for employers to file these claims to meet the three-year statute of limitations. The deadline has been extended until Nov. 14.
About 165,000 businesses have submitted claims so far through the online process, according to the Department of Taxation and Finance. Four lawsuits filed against the levy were dismissed, but one filed by Nassau County and joined by Westchester and Putnam counties and other parties was found by a state Supreme Court judge last summer to be unconstitutional. The state and MTA have appealed. The state Court of Appeals declined to hear the case this fall and kicked it back to the Appellate Division.
Rockland County’s lawsuit was one of the cases that was dismissed, but the county is preparing an appeal.
The devastation caused by Sandy begs the question of is it appropriate to talk about reducing the revenues the MTA, which serves New York City and seven suburban counties, gets from the tax now.
Al Samuels, president of the Rockland Business Association, said the damage caused by Sandy doesn’t change the organization’s opposition to it. “Constitutionality and need are not necessarily the same,” he said.
Spokesmen for the Department of Taxation and Finance and the MTA said they are confident the Nassau County decision will be overturned on appeal. Below is a statement from MTA spokesman Aaron Donovan:
“The MTA strongly believes that the ruling from Nassau Supreme Court is erroneous. We expect it will be overturned, since four similar Supreme Court cases making the same argument were previously dismissed.
“Our top priority right now is restoring railroad, subway, bus, and vehicular tunnel service to all New Yorkers. For now, no one here is tallying the costs of this enormous undertaking, but our need for capital funding to keep the lifeblood of New York running was substantial even before the hurricane.
“The last week has shown how much the entire New York metropolitan region and the State as a whole rely on a well-functioning MTA. The Payroll Mobility Tax maintains a regional transportation system that moves more than 8.5 million people every day and drives the economy of New York City, Long Island, the northern suburbs and the entire state.
“Removing more than $1.8 billion in revenue from the Payroll Mobility Tax and other fees affected by the ruling would be catastrophic for the MTA and for the economy of New York State. In 2010, to help reduce our budget deficit, we implemented what were described by outside observers as the worst service cuts in a generation; they saved a total of $93 million per year.
“The MTA is getting its fiscal house in order. We have cut more than $700 million from our annual operating budget and eliminated 3,500 jobs, and we are on track for this year’s discretionary spending to be lower than last year’s.
“Without the Payroll Mobility Tax or another stable and reliable source of funding, the MTA would be forced to implement a combination of extreme service cuts and fare hikes. The Payroll Mobility Tax remains in effect and we expect that it will survive this legal challenge.”