Seneca Indian Gas Station Would Cost $1.6 Million a Year in Lost Tax Revenue, Maybe More

NIAGARA FALLS, NY (03/15/2016)(readMedia)-- The New York Association of Convenience Stores estimated today that at least $1.6 million a year in state and local tax revenue will be lost if the proposed Seneca Indian Nation gas station is built adjacent to the Seneca Niagara Resort and Casino property in Niagara Falls.

"It appears the proposed facility would have 12 multi-product dispensers with pump nozzles facing either side, providing 24 fueling positions for motorists," said NYACS President Jim Calvin.

"Based on the experience of local gasoline retailers, a facility that size would be designed to pump approximately 5 million gallons of motor fuel per year. Factoring in a steady, 24-hour clientele, and an ability to promote gas fill-ups as an incentive to casino patrons, the volume could range as high as 6.5 million gallons.

"If one were to liberally assume that one-fifth of that volume (1 million to 1.3 million gallons) would be sales that otherwise would occur at existing 'tax-free' tribal enterprises elsewhere in Western New York, the 'impact volume' of the new facility would be 4 million to 5.2 million gallons.

"At non-Indian gas stations in Niagara County, assuming an average pump price of around $2 a gallon, about 41 cents per gallon in state and county taxes are collected.

"That means if 4 million to 5.2 million gallons of volume shifted from tax-collecting gas stations to the new 'tax free' fueling facility proposed by the Senecas, the state and county combined would lose $1,640,000 to $2,132,000 in tax revenue annually," Calvin said.

This doesn't even factor in the loss of additional excise and sales taxes on cigarettes that would be sold "tax free" inside the convenience store that is part of the gas station plan.

Existing New York State law requires the collection of state taxes on motor fuel and cigarettes sold by tribal enterprises to non-Indian customers, but the law is not actively enforced.