Empire State Restaurant & Tavern Association: Newsletter

The state legislature was heading towards adoption of the final parts of the state budget as the Fourth of July holiday approached until a last minute hiccup in the State Senate caused that plan to be put on hold. The Assembly did its part completing adoption of the budget and the remainder of their general legislative work before leaving Albany. While a resolution to the problem in the Senate will likely cause a few changes to the budget it should not impact your business. The enacted budget does include significant cuts in spending and substantial tax increases and yet some believe that not enough was done to avoid a continued budget deficit. When the dust finally settled at the end of the session here’s where we ended up on our key issues:

Alcohol server training…both the Assembly and Senate passed a bill that provides incentives for those establishments with trained servers. This new law, which we worked to enact for many years, will reduce SLA penalties for establishments whose servers have completed an approved server training program and have a clean record with the Liquor Authority. We expect Governor Paterson will sign this bill into law.

Quick Draw…legislation passed both houses and awaits the Governor’s approval to make the Quick Draw game permanent. The bill also removes the one-hour midday shutdown and eliminates restrictions on the total number of hours the game may be operated each day. The actual hours Quick Draw is operated will be determined by the Lottery Division.

Retail-to-retail sales…our effort to authorize on-premises licensees to purchase wine and spirits from liquor stores fell short when the legislature declined to pass the Governor’s wine in grocery store proposal.

State Liquor Authority…the budget increases the SLA’s funding in order to support technology upgrades at the agency over the next two years. However, legislation to grant the Authority general rulemaking powers and to give the Chairman executive authority to run the agency failed to gain approval by the legislature. The State Senate passed the executive authority bill but it got hung up on its way to final passage in the Assembly.

Tax increases…the budget increases the tax on cigarettes and other tobacco products giving New York the highest tobacco tax rates in the nation.

Native American tax collection…the enacted state budget provides a mechanism to begin collecting taxes on cigarettes sold by Native American retailers to non-natives effective September 1, 2010. We await the details on implementation of these provisions of law.

Tax compliance measures…the budget includes provisions to allow statistical sampling of tax records and requires credit/debit card settlements to be reported to the state. The statistical sampling provision is supposed to be a scientific audit method although we doubt it’s as fair and sound as claimed. The information reporting requirement for banks to report all credit/debit card settlements into retailer bank accounts to the state piggybacks on a new federal rule and is an alternative to the plan we helped defeat last year that would have required all bank deposits to be reported to the Tax Department.