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State seizes Funk's Diamond Diner
  
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City also seeks claim of ownership for unpaid taxes
By Jamie Larson
Hudson-Catskill Newspapers
The Diamond Street Diner on Warren Street in Hudson displayed three bright orange signs in its windows Wednesday morning announcing its new temporary owner, the state of New York. The Diner has been seized by the New York State Department of Taxation and Finances (NYSDTF) for thousands of dollars in unpaid sales tax.
The seizure comes as another piece of bad news for the troubled diner. Owner, and former Sheriffs Deputy James Funk, was charged by Attorney General Andrew Cuomo last month with stealing bail money from the Stockport Town Court while a sitting judge. According to the report Funk was allegedly using the court funds to pay bills at his diner.
The diner is also in the midst of foreclosure proceedings with the city of Hudson, owing over $19,000 in back taxes as well as water and sewer bills. The foreclosure was scheduled to go to court within the next two months but now the seizure by the state has officials at both levels wondering who has a right to the diner if Funk cant pay up. For now the diner belongs to the state but the city would also try and seize the diner themselves if their taxes are not paid.
The diner currently has four outstanding NYSDTF warrants against it worth $2,890.46 for unreported sales tax. The state Department of Labor has also issued a warrant against the Diner in an attempt to collect $4,123.87 in unpaid unemployment insurance contributions.
“A seizure is an action of last resort,” said Tom Bergin, spokesman for the state department of taxation and finance. “We’d love to resolve the issue and hand the keys back to the taxpayer.
“We don’t want to own a business,” Bergin continued. “But when a taxpayer is collecting sales tax and not sending them to the state he’s cheating the system. He’s cheating other businesses and he’s cheating everybody who eats there and pays sales tax.”
Bergin said the department likes to help people make their payments but in light of Funk’s complicated circumstance they felt the time to act was now.
Funk was charged on Aug. 4 with stealing $27,000 from the Stockport town court. The AG’s office alleges he used the stolen court fees and bail money to pay off previous bills he owed on the diner and his residence. Funk now faces up to seven years in prison and a $5,000 fine.
In one instance, Cuomo’s office says, Funk tried to cover his tracks by having an official bank check issued to one of his employees at the diner. Funk later crossed out the employee’s name and substituted it with “National Grid.”
“As pillars of our legal system, judges are sworn to uphold the law and should be held to the highest professional standards,” Cuomo said. “Allegations of criminal acts from the bench will be thoroughly investigated and prosecuted by my office. Judges, like all government employees, are not above the law and must never use their official positions for personal gain.”
As for the money Funk owes the city of Hudson in back taxes, City treasurer Eileen Halloran said the city tried to help the Diner along the way before taking action on the property themselves. In April 2008 the diner entered into a 24- month installment agreement to begin repaying what was owed. In January however payments stopped coming in, voiding the installment agreement. The diner has also not turned in four months worth of taxes in 2009, and three months worth of water and sewer bills.
If the city forecloses on Diamond Street it is unclear whether the city or the state has the right to take ownership of the property. Both Halloran and Bergin said they would consult legal council on the issue to determine who’s authority takes precedent.
The seizure comes as another piece of bad news for the troubled diner. Owner, and former Sheriffs Deputy James Funk, was charged by Attorney General Andrew Cuomo last month with stealing bail money from the Stockport Town Court while a sitting judge. According to the report Funk was allegedly using the court funds to pay bills at his diner.
The diner is also in the midst of foreclosure proceedings with the city of Hudson, owing over $19,000 in back taxes as well as water and sewer bills. The foreclosure was scheduled to go to court within the next two months but now the seizure by the state has officials at both levels wondering who has a right to the diner if Funk cant pay up. For now the diner belongs to the state but the city would also try and seize the diner themselves if their taxes are not paid.
The diner currently has four outstanding NYSDTF warrants against it worth $2,890.46 for unreported sales tax. The state Department of Labor has also issued a warrant against the Diner in an attempt to collect $4,123.87 in unpaid unemployment insurance contributions.
“A seizure is an action of last resort,” said Tom Bergin, spokesman for the state department of taxation and finance. “We’d love to resolve the issue and hand the keys back to the taxpayer.
“We don’t want to own a business,” Bergin continued. “But when a taxpayer is collecting sales tax and not sending them to the state he’s cheating the system. He’s cheating other businesses and he’s cheating everybody who eats there and pays sales tax.”
Bergin said the department likes to help people make their payments but in light of Funk’s complicated circumstance they felt the time to act was now.
Funk was charged on Aug. 4 with stealing $27,000 from the Stockport town court. The AG’s office alleges he used the stolen court fees and bail money to pay off previous bills he owed on the diner and his residence. Funk now faces up to seven years in prison and a $5,000 fine.
In one instance, Cuomo’s office says, Funk tried to cover his tracks by having an official bank check issued to one of his employees at the diner. Funk later crossed out the employee’s name and substituted it with “National Grid.”
“As pillars of our legal system, judges are sworn to uphold the law and should be held to the highest professional standards,” Cuomo said. “Allegations of criminal acts from the bench will be thoroughly investigated and prosecuted by my office. Judges, like all government employees, are not above the law and must never use their official positions for personal gain.”
As for the money Funk owes the city of Hudson in back taxes, City treasurer Eileen Halloran said the city tried to help the Diner along the way before taking action on the property themselves. In April 2008 the diner entered into a 24- month installment agreement to begin repaying what was owed. In January however payments stopped coming in, voiding the installment agreement. The diner has also not turned in four months worth of taxes in 2009, and three months worth of water and sewer bills.
If the city forecloses on Diamond Street it is unclear whether the city or the state has the right to take ownership of the property. Both Halloran and Bergin said they would consult legal council on the issue to determine who’s authority takes precedent.
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21333 wrote on Sep 8, 2009 11:39 AM: