Mineola, NY- Nassau County Comptroller George Maragos released his audit of SMG, formerly Spectacor Management Group, which operates the Nassau Veterans Memorial Coliseum, and found that it owes the County $176,523 in ticket taxes in addition to $5,992,980 in unpaid utilities, rent, parking and concessions dating back to 2011. Its lease with the County expires at the end of July, and the Comptroller is urging the County to take all necessary steps, including legal action, to collect the money owed plus penalties and interest allowed under law.
“SMG appears to have used numerous delay tactics to avoid paying its rental obligations from the Nassau Coliseum including pleas of ignorance in underpaying ticket taxes,” Comptroller Maragos said. “These delays have gone on for too long. We urge the County Executive to now refer the payment issues to the County Attorney for appropriate legal action so as to ensure that SMG pays its tax and lease obligations.”
The Comptroller’s review of the SMG’s Entertainment Tax Returns found that SMG owes the County a total of $176,523 including penalties and interest for unpaid taxes on 66,704 tickets sold for the period of January 1, 2012 to March 31, 2014. The audit found specifically that SMG did not verify the tax exempt status or maintain tax-exempt certificates of organizations claiming tax exemptions and also did not require payment for tickets to be made directly by the organizations for 65,381 tickets. The audit also identified another 1,323 tickets that were sold but not included on the tax returns.
The Entertainment Surcharge Tax regulation imposes a surcharge tax of $1.50 per ticket for entertainment events held at venues in Nassau County with a permanent seating capacity of at least 2,500 seats. The Nassau County Administrative Code, Article 3a Entertainment Surcharge Regulation[1] also allows tax-exempt organizations to be exempt from the tax. According to New York Tax Law Chapter 179.2 (Section 1202(d)(iii)), “such tax may be collected and administered by the County Treasurer or other fiscal officers of Nassau County by such means and in such manner as other taxes which are now collected and administered by such officers or as otherwise may be provided by such local law, ordinance or resolution”. Collecting this tax in the same manner as other taxes requires the organization to have a valid tax-exempt certificate and be the direct payer of record[2] in order to be exempt from taxes. Any person failing to pay the $1.50 surcharge tax shall be subject to a penalty of fifty percent on the tax amount due plus interest of nine percent per annum, compounded daily on the total tax and penalty amount.[3]
The Comptroller’s Office also confirmed that as of April 29, 2015, SMG owes the County $5,992,980 in unpaid rent, utilities and revenue payments that it is contractually obligated to make. The chart below lists the amount due after a recent $1.25 million payment made on March 11, 2015.
Please click here For Final_Review of SMG Entertainment Tax_5_19_15
