Conn. tribe drops suit over taxes on slot machines

HARTFORD, Conn. (AP) – The tribe that owns the Foxwoods Resort Casino will not appeal a ruling that upheld the government’s authority to collect property taxes on slot machines, the Mashantucket Pequot Tribal Nation said Tuesday.

The tribe, which had fought the taxes collected on leased slot machines since 2003, said it will not appeal to the U.S. Supreme Court, but it will take up the issue in discussions with the state of Connecticut.

The tribe said in a statement provided to The Associated Press that it sued “because such taxes are an affront to the tribe’s sovereign authority over its territory,’’ especially since it provides government services within the reservation.

In July, the 2nd U.S. Circuit Court of Appeals in New York ruled against the tribe, which operates one of the country’s largest casinos. The decision overturned a lower-court judge who had earlier ruled for the tribe in its lawsuit against the town of Ledyard and the state of Connecticut.

The 2nd Circuit noted that a ruling favorable to the tribe would have invited other non-Indian owners of personal property on the reservation to bring similar lawsuits, costing the town hundreds of thousands of dollars annually in litigation costs.

The lawsuit pertained to two slot machine companies that generated about $20,000 in property tax income annually.

The attorney who represented the town, Benjamin S. Sharp, said the town could have suffered much more severely if the tribe blocked tax collection from other vendors such as restaurants with a presence at the casino.

“The amount of dollars involved in a single year are probably not huge, but over many years, particularly if the principle used by the tribe applied to all property, it became a significant hit to the revenues of the town,’’ Sharp said Tuesday.

Attorney General George Jepsen said he had no comment on the dispute. But he said he applauded “the willingness of the Mashantucket Pequot tribe to seek an amicable resolution to this matter through discussions with the appropriate local government authorities.’’