Senator pleads guilty to failing to pay sales tax, keeps Senate seat

INDIANAPOLIS -- A state senator from East Chicago pleaded guilty Tuesday to failing to pay sales taxes.\nSen. Sam Smith, a Democrat, will be allowed to retain his seat in the Indiana Senate because the charge was not a felony.\nThe 46-year-old senator, who is running for re-election this year, had no comment after the hearing.\nSmith politely told Marion Superior Court Judge Mark Stoner "Yes, sir" when asked if he was guilty of the tax charge as part of a plea bargain, The Indianapolis Star reported.\nSmith's attorney, Linda Pence, said it will be up to voters to decide if he stays in office.\nState law would have forced his removal had he been convicted of a felony.\nSmith originally faced one count of failing to file an income tax return, two counts of theft, two counts of failure to remit sales tax and two counts of perjury. The charges came during a probe of the Build Indiana Fund by the Marion County Prosecutor's Office.\nAs part of his plea bargain, Smith has repaid at least $15,000 in penalties and sales taxes he did not give the state from his Divinity Funeral Home in East Chicago. He also was ordered to serve a year of probation.\nDeputy Prosecutor Ellen Corcella said legislators should be held to a higher standard because they have the public's trust. But she said prosecutors could not find another situation of someone being charged with a stiffer felony charge even after paying taxes and penalties.\n"We couldn't treat him differently than other taxpayers," she said.\nEast Chicago Pastor Lee Gilliam was sentenced in November to four years in a halfway house for stealing Build Indiana money that was supposed to be used to construct a battered women's shelter. Instead, he used much of it to buy fur coats and boots.\nSmith had earmarked the grants for Gilliam.\nMarion Superior Court Judge Cale Bradford also ordered Gilliam to pay back more than $150,000 and give the state the proceeds from the sale of three buildings he bought with government money.\nState lawmakers created the Build Indiana Fund in 1989 to pay for infrastructure needs, such as sewer projects or police and firefighter equipment. It is funded by Hoosier Lottery profits and casino taxes.