Note 8 - Federal, State and Local Income Taxes:

In accordance with the requirements of the Income Tax Topic of the FASB's ASC, the Company's provision for income taxes includes the following:

	Three Months Ended July 31,
($ in thousands)	2016			2015
Current tax expense:
Federal	$	3,577		$	1,024
State and local		325			72
Current tax expense		3,902			1,096
Deferred tax expense (benefit):
Federal		(189	)		(12	)
State and local		15			(151	)
Deferred tax expense (benefit):		(174	)		(163	)
Income tax provision	$	3,728		$	933

Deferred income taxes are provided for temporary differences between the financial reporting basis and the tax basis of the Company's assets and liabilities. The tax effect of temporary differences giving rise to the Company's deferred tax asset and deferred tax liability are as follows:

	July 31,			April 30,
($ in thousands)	2016			2016
Federal tax benefit (liability):
Unrealized gains on securities available-for-sale	$	(239	)	$	(68	)
Capital loss carryforward		-			86
Operating lease deferred obligation		41			58
Deferred professional fees		17			77
Deferred charges		249			250
Total federal tax benefit		68			403

State and local tax benefits:
Other		28			29
Total state and local tax benefits		28			29
Deferred tax asset, short term	$	96		$	432

	July 31,			April 30,
($ in thousands)	2016			2016
Federal tax liability (benefit):
Deferred gain on deconsolidation of EAM	$	17,726		$	17,679
Deferred non-cash post-employment compensation		(619	)		(619	)
Depreciation and amortization		1,454			1,812
Other		(120	)		8
Total federal tax liability		18,441			18,880

State and local tax liabilities (benefits):
Deferred gain on deconsolidation of EAM		1,702			1,704
Deferred non-cash post-employment compensation		(60	)		(60	)
Depreciation and amortization		140			174
Other		(10	)		(15	)
Total state and local tax liabilities		1,772			1,803
Deferred tax liability, long term	$	20,213		$	20,683

At the end of each interim reporting period, the Company estimates the effective income tax rate to apply for the full fiscal year. The Company uses the effective income tax rate determined to provide for income taxes on a year-to-date basis and reflects the tax effect of any tax law changes and certain other discrete events in the period in which they occur.

The overall effective income tax rates, as a percentage of pre-tax ordinary income for the three months ended July 31, 2016 and July 31, 2015 were 36.96% and 30.57%, respectively. The Company's annual effective tax rate will change due to a number of factors including but not limited to an increase or decrease in the ratio of items that do not have tax consequences to pre-tax income, the Company's geographic profit mix between tax jurisdictions, taxation method adopted by each locality, new tax laws, new interpretations of existing tax laws and rulings and settlements with tax authorities. The fluctuation in the effective income tax rate during fiscal 2017 is primarily attributable to the attribution of 100% of the gain on the sale of the Company's operating facility to one tax jurisdiction and partially to the effect from the scheduled reduction in the allocation factors on the state and local current and deferred tax liability (primarily associated with the gain on deconsolidation of EAM), and the dividend received deduction.

The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory income tax rate to pretax income as a result of the following:

	Three Months Ended July 31,
	2016			2015
U.S. statutory federal tax rate		35.00	%		35.00	%
Increase (decrease) in tax rate from:
State and local income taxes, net of federal income tax benefit		1.99	%		-3.57	%
Effect of dividends received deductions		-0.06	%		-0.32	%
Domestic production tax credit		0.00	%		-0.63	%
Other, net		0.03	%		0.09	%
Effective income tax rate		36.96	%		30.57	%

The Company believes that, as of July 31, 2016, there were no material uncertain tax positions that would require disclosure to GAAP.

The Company is included in the consolidated federal income tax return of the Parent, and beginning with the fiscal year ended April 30, 2017, will file combined tax returns with the Parent on a unitary basis in certain states as a result of changes in state tax regulations.

The Company’s federal income tax returns (included in the Parent’s consolidated returns) and state and city tax returns for fiscal years ended 2013 through 2016, are subject to examination by the tax authorities, generally for three years after they are filed with the tax authorities. The Company favorably concluded certain tax audits during the third quarter of fiscal 2016 that provided the recognition of tax benefits resulting from a favorable outcome. The Company is presently engaged in a state tax audit, but does not expect it to have a material effect on the financial statements.