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SENATE OKS REFUND LOAN TO CITY TAXPAYERS TO GET $23 MILLION FROM HURD RULING

The State Senate unanimously approved legislation Monday that will lend Buffalo $23 million to pay taxpayer refunds from the 1974 Hurd decision.

The legislation now goes to the Assembly, where it is racing against the clock and a mountain of other legislation. The Assembly and Senate are attempting to conclude their regular session by July 4.

The proposal's sponsor in the Senate, Sen. Dale Volker, R-Depew, expressed optimism that the bill will be approved by the Assembly and signed into law by the governor.

The interest-free loan is modeled after a loan given to Rochester in 1981. Both cities were the victims of a state law that was later ruled unconstitutional.

That law allowed cities to exceed their constitutional tax limits.

As with Rochester's loan, the state would lend Buffalo the funds each year and would be repaid during the same fiscal year. But because the state's treasury is distressed this year, the Buffalo legislation, unlike Rochester's loan, specifies that the funds must be repaid by the end of each fiscal year.

No deadline was set in the legislation that created Rochester's loan in 1981. Instead, Rochester and the state signed a contract establishing a pay-back deadline.

By including the April 1 deadline in the law, the legislation will be able to overcome objections that the state cannot afford the loan, Volker said.

Since the money will be lent by the state at the beginning of the year and repaid at the end, it will be as if the state never lent the money, supporters of the legislation say.

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