Two members of the Common Council, Demone A. Smith and Bonnie E. Russell, have financial

histories that include liens for failure to pay their state income taxes, a Buffalo News

investigation has found.

A search of public records showed Smith — who represents the Masten District and

serves as president of Grassroots Inc., the political club affiliated with Mayor Byron W.

Brown — had three noteable problems:

The state Department of Taxation and Finance filed a lien against Smith last

February for $6,012 for unpaid personal income taxes from 2000 and 2001. Smith said that he

protested the lien and that the state settled with him for an unspecified amount that involved

applying a refund due him and a payment of $89 from him.

The state attorney general placed a lien against Smith in 2000 for $972 for failure

to pay for a course Smith enrolled in at the University at Buffalo that he said he

subsequently withdrew from without taking any classes. He paid off the lien in February 2007.

Smith has failed to pay $1,282 in judgments that the state Board of Elections has

filed against him for his habitual failure to file campaign financial disclosure reports on

time.

Russell, who has represented the University District since 2004, also has had tax issues.

The state filed three liens seeking unpaid income taxes against Russell and her husband,

Robert, who has been a City Court judge since 1992.

The Department of Taxation and Finance filed a lien for $573 in 1994 and two separate liens

in 2004 that totaled $3,574. The liens sought unpaid income taxes from 1990, 1998 and 1999.

All liens were satisfied shortly after they were filed.

Russell took much longer to pay off a lien filed in 2005 for $9,620. She said it involved

her son's loans that she co-signed for. The lien was satisfied last September.

Russell, 50, didn't have a recollection of the 1994 tax lien and said those filed in 2004

were the byproduct of "marital related issues" that she declined to discuss further.

Public records also show that the state Department of Motor Vehicles has suspended her car

registrations three times — on two vehicles in 2004 and one in 2006 — for a lapse

in insurance. She was at a loss to explain those suspensions. Her vehicle registrations are

now current.

The News conducted similar background searches on the finances of all nine Council members.

Russell and Smith were the only ones with histories of bad debt, as indicated by liens.

Russell and Smith are the mayor's strongest supporters on the Council.

Russell said she couldn't take issue with those who might criticize her for failing to pay

her taxes, given that Council members have the power to raise taxes and spend public funds.

"I would agree. It's definitely a good point," she said.

Smith's financial difficulties are more complicated.

He acknowledged failing to file a state income tax return for 2000, while maintaining he

submitted a return in 2001 that he said the state failed to process.

Tax officials, who noted they give taxpayers numerous opportunities to pay overdue taxes

before taking legal action, filed a lien against Smith a year ago seeking $6,012 for unpaid

income taxes in 2000 and 2001.

Smith, 36, said he filed a protest and submitted his missing tax return after the state

obtained the lien. He said the state then recalculated his taxes and determined he was owed a

refund, the amount of which he did not disclose. That refund was applied against what he owed

after his protest, a figure that state tax officials said they could not disclose because of

confidentiality laws. The balance then was settled with a payment of $89.

It is unclear how much of that $6,012 lien Smith eventually owed after the protest process

was completed.

Smith did not return phone calls Thursday and Friday seeking that figure.

Earlier, Smith said he should not be open to criticism about the tax issue because it was

settled with only a nominal payment.

"All my taxes have been paid," he said. "I haven't had a problem with paying taxes at all."

As for the lien filed to recoup unpaid tuition, Smith said he disputed it but eventually

paid the debt for a course he registered for but never took at UB. He said he protested the

assessment but said the state refused to waive it.

"I was fighting that because I never took the class. I enrolled and dropped it," he said.

Smith still owes money stemming from his failure to file campaign disclosure report with

the Board of Elections.

His campaign has failed to file most, if not all, of his campaign finance disclosure forms

on time during his time in public office.

He first ran for the Erie County Legislature in 2005 and was required to file seven reports

over the course of the year. He didn't file any reports until the summer of 2006, after his

failure prompted coverage in The News. During this period, he served as chairman of the

Legislature's Finance and Management Committee.

Smith did the same thing when he ran for the Council in 2007, failing to file any of seven

reports until December of that year, after the election was over.

Since then, Board of Elections records show that non-election year reports due twice a year

in 2008 and 2009 also were filed late. As of Friday, Smith had not filed the report that was

due Jan. 15 of this year, according to the Board of Election's Web site.

"His treasurer has a history of doing things late," said John Conklin, a spokesman for the

Board of Elections.

Failure to file on time is a civil violation of state election law, and the Board of

Elections has obtained three judgments against his campaign committee totaling $1,282.

Smith has not paid any of the judgments, the oldest of which dates to March 2008. He said

he was unaware of the judgments and has not received any bills.

"I have filed late, definitely," he said, adding that he is considering hiring an

accountant to ensure the reports are submitted on schedule in the future.

"I definitely have to do better and take it more seriously," he said.