Villages suing for $20 million

Municipalities join Freeport in sales tax class-action lawsuit


With Freeport Mayor Robert Kennedy leading the effort, 13 villages are suing Nassau County and the Town of Hempstead for not fairly sharing sales tax revenue with the villages.

Kennedy filed a $2.5 million notice of claim on June 1, and an amended claim for a minimum of $20 million on July 31, which included 11 other villages — Atlantic Beach, Bellerose, Cedarhurst, East Rockaway, Hempstead, Hewlett Bay Park, Hewlett Harbor, Lynbrook, South Floral Park, Valley Stream and Woodsburgh. The Village of Rockville Centre has filed its own lawsuit, according to Kennedy.

Villages that have not joined the lawsuit include Island Park, Lawrence and Malverne.

“In the event a settlement is agreed between the town, county and villages,” Kennedy said, “I will not include villages that elected to not participate in our legal action.”

Last August, Kennedy, a past president of the Nassau County Village Officials Association and the current first vice president of the New York Conference of Mayors, helped launch a petition, with support from NCVOA, requesting equal distribution of sales tax revenue at the beginning of fiscal 2018. Sixty village mayors signed the petition.

Freeport generated $15.8 million in state sales taxes in 2016 (the most recent year for which records are available), but re-ceived only $119,088 in revenue, or $2.64 for every resident, in fiscal 2018. Lynbrook generated more than $2.8 million in sales tax in 2016, but this year the village has re-ceived just $53,979 in reimbursements from the town and county, or $2.76 for every village resident. East Rockaway generated $1.4 million in sales tax in 2016, but this year it received $27,280, or $2.78 per resident. Meanwhile, the county and town received $49.50 per resident, according to Kennedy.

Nassau County is authorized to collect 0.75 percent of state sales tax, and distributes one-third of that to cities and towns in the form of local assistance programs to minimize real property taxes and defray the costs of collecting, transporting, treatment and disposal of solid waste, documents show.

According to Kennedy, however, the Town of Hempstead does not provide solid-waste management to villages. And villages like Freeport, which has its own water, sanitation and police departments and an electric company, need a greater share of sales tax revenue to maintain services, Kennedy said.

Freeport Village Attorney Howard Colton claims that the town uses the money to balance its budget, and Kennedy says that the town uses the villages’ populations to “boost its allocation of monies” without providing them with any services.

East Rockaway Mayor Bruno Romano, who joined the suit, said that receiving a fair share of the sales taxes would offset some of the expenses of the village’s Department of Public Works.

“The town has been discussing the villages’ interpretation of the law, and looks forward to resolving the matter amicably,” a spokesman for Town Supervisor Laura Gillen stated in a past email.

Kennedy has criticized County Executive Laura Curran for not keeping a 2017 campaign promise to share a fair portion of sales tax revenue with Nassau County villages. “She has reneged,” Kennedy said.

The Herald was unable to reach Curran or a representative of her office for comment.