CHARLESTOWN -- The Narragansett Indian Tribe opened a tax-free smoke shop on tribal lands yesterday, saying that the tribe would no longer wait for the economic-development initiatives that Governor Carcieri had offered as an alternative.
"I don't know what the temperature in hell is this morning, but we can't wait for it to freeze over," said the tribe's chief sachem, Matthew Thomas, puffing on a cigar while TV cameras rolled. "Specials this week: Marlboros are $25 a carton, so come on down."
Seven weeks ago, the tribe postponed opening the shop at Carcieri's request, and state and tribal officials discussed other ways to advance the tribe's interests. The governor made a historic visit to the tribal lands and pledged his help.
But the talks with the Rhode Island Economic Development Corporation have stalled, Thomas said yesterday. Even if they resume, he added, the state hasn't offered enough help.
If the state will not help the tribe's 2,600 members, Thomas said, the tribe has no choice but to help itself. "It was somewhat of a tough decision. We're at the end of our rope. . . . Our money is running out."
Carcieri was visiting his son Matthew in Cincinnati yesterday, but he released a statement at 5 p.m.:
"I have been in constant communication with my staff today regarding the opening of the smokeshop in Charlestown. The sale of cigarettes without charging state sales and tobacco taxes is illegal under both state and federal law. The appropriate departments of state government have been notified and we are in the process of responding to what appears to be an illegal act."
CUSTOMERS FLOCKED to the little trailer on South County Trail yesterday, even though the opening had not been advertised. By forgoing a $1.32-per-pack state excise tax on cigarettes, and the 7-percent sales tax, the smoke shop can offer cartons of name-brand cigarettes at deep discounts.
"All different flavors. You want it, we got it," said Keith Huertas, the store manager. Only cigarettes were available yesterday, but the tribe plans to branch out into other tobacco products.
Ray and Ann Knowles of Narragansett bought a carton of Merits for $22.99. Tax included, the same carton would have cost them $54.55 at Rippy's Marketplace, a little farther up the road.
"I'd have to say I'm 100-percent behind this. They have every right to do what they're doing," Ray Knowles said. Turning to a tribe member, he said, "I wish you every success. I think it's proper and I think it's overdue."
State tax officials have said that the smoke shop could eventually gain 10 percent of the state's cigarette business. That would punch a hole of more than $10 million in the state's excise-tax revenue, along with a $2-million loss in sales tax.
The budget passed by the General Assembly, which Carcieri has vetoed, calls for a 39-cent hike in the cigarette tax, which would make tax-free cigarettes even more attractive.
THOMAS SAID his last word with state officials was a June 27 meeting with Michael McMahon, executive director of the EDC. Talk of a follow-up meeting never came to fruition, he said.
Carcieri spokesman Jeffrey Neal said he couldn't comment on EDC's talks with the tribe.
Thomas said the tribe's annual budget of roughly $6.5 million may show a $1.5-million shortfall in the next fiscal year, mostly because of cuts in federal grants.
The tribe's police department and senior and youth services are at risk, he said. When the fiscal year begins in January, he said, "we'll have to face reality and start laying people off" unless more money is found.
Thomas said he would honor McMahon's request not to discuss the specifics of the state's economic-development proposals. But he said that the state's proposal does not address his main concern, the impending revenue crunch.
Thomas said he is still interested in talking with state officials, but "whether they'll continue to meet with us now is anyone's guess."
The tribe's hopes for economic advancement were dealt a blow last week when a bill to allow a statewide vote on casino gambling died in the Senate. For years the tribe has been seeking state permission to build a casino in West Warwick.
For the tribal leaders gathered at the smoke shop yesterday, the "grand opening" was a gesture of defiance. The Narragansetts have a long list of grievances against the state, some centuries old.
"The state has taken away our religion, our water rights, our language. It's taken away our right to have a casino," said Paulla Dove, a tribal council member who watched clerks ring up the first cartons yesterday. She urged the state to take an interest in the Narragansetts' problems in health, education and homelessness.
THE TRIBE notified the governor's office of the smoke shop's debut in an e-mail message shortly before the 11 a.m. opening.
The president of the Charlestown Town Council, which has vowed to oppose the shop, learned of the opening only when contacted by a reporter yesterday afternoon.
"The what?" said Deborah Carney. "It opened today? This is news to me.. . . . I have no comment at this time. Let me call and see what I can find out about it." Carney was not available later for comment.
Thomas acknowledged yesterday that a legal battle over the smoke shop is all but inevitable. "When it comes time to battle, we'll battle. We're not afraid to fight."
His parting words to a reporter: "I'll see you Monday in court."
