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Court Rules that County Cannot Grab Town’s Tax Receipts to Cover Old FIT Tuition Payments

 May 1, 2017
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Court Rules that County Cannot Grab Town’s Tax Receipts to Cover Old FIT Tuition Payments

North Hempstead, NY – In an opinion released on Wednesday, April 26, the NYS Appellate Division, Second Department, in Brooklyn unanimously upheld the Town of North Hempstead's position that Nassau County had waited too long to recover tuition payments to the Fashion Institute of Technology (FIT) made on behalf of Town residents in the years 2004 - 2009.

Under state law, the County must pay FIT a portion of the tuition for County residents. In 2010, the County began charging the cost back to the towns of North Hempstead, Oyster Bay and Hempstead, as well as the cities of Long Beach and Glen Cove. In 2016, the County demanded reimbursement for tuition paid to FIT from 2004-2009 and seized approximately $1.3 million from the Town of North Hempstead’s sales tax to cover the tuition payments in 2004 -05. A trial court granted the Town summary judgment and ordered the County to return the money. The Appeals Court also ordered the County to return the approximately $1.3 million, plus interest, that the County had deducted from the Town's sales tax receipts. The Court upheld an earlier decision that the County had no right to withhold the Town's sales tax for such old claims. The County had planned to deduct approximately the same amount from the Town's 2017 and 2018 sales tax as well. The Court decision rules out that course of action.

The Appeals Court decision will apply to the other two Towns and Cities as well.

"We are gratified by the Court's decision. The County punched a hole in our 2016 budget and we said they did not have that right," said North Hempstead Town Supervisor Judi Bosworth. "I commend the tenacity of Deputy Town Attorney Amanda Abata and Town Attorney Elizabeth Botwin in getting our funds back."


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