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RULING SUBJECTS RESERVATION NON-INDIANS TO PROPERTY TAXES

A state appellate court ruled Wednesday that Cattaraugus County has property-taxing authority over non-Indian residents of the Allegany Indian Reservation.

The five-judge Appellate Division of State Supreme Court in Rochester unanimously overturned the 10-month-old ruling of acting State Supreme Court Justice Wayne A. Feeman Jr., who barred the county from using the City of Salamanca's 1997 tax payments for its own purposes.

The appellate court, which heard arguments Dec. 1, agreed with Cattaraugus County Attorney Dennis V. Tobolski that Feeman, an Allegany County judge on temporary assignment, erred when he cited federal Indian law when ruling in the city's favor last February.

Since last May, the Cattaraugus County treasurer's office has kept more than $700,000 in recent property-tax collections from Salamanca residents and businesses in an interest-bearing escrow account.

Tobolski said Wednesday he will ask Feeman to dismiss a $5 million lawsuit that the city, several of its councilman and National Fuel filed last March, seeking a refund of county taxes paid between 1991 and 1996. Tobolski said he also will ask Feeman to allow the county to begin using the tax money currently being held in the escrow account.

Donald J. Swanz, the Franklinville attorney retained for the case by Salamanca city officials, could not be reached to comment about a possible appeal.

During the Dec. 1 appellate hearing, Swanz contended that the State Legislature and Gov. Pataki acted correctly in September to alter state Indian law, allowing the county to begin collecting such property taxes. Swanz, however, questioned the legality of the state making the change retroactive to 1991 and urged the appellate judges to return the case to Feeman to resolve new legal issues linked to the change.

After the appellate hearing five weeks ago, Swanz doubted the legality of making the state Indian Law change retroactive to Feb. 19, 1991, to cover 40-year leases between the Senecas and Salamanca.

Last February, Feeman ruled city residents and businesses on reservation land were exempt from paying taxes to the county because its authority to collect them expired when they signed new leases with the Seneca Nation of Indians in 1991.

Feeman based his ruling on federal legislation known as the Seneca Settlement Act of 1990.

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