WPCNR County Clarion-Ledger. By John F. Bailey July 9, 2018:
PKF O’Connor Davis, Westchester County auditors, advised the County Legislature: a 5.7% Property Tax Hike and a ½% Increase in the county sales tax could close the county budget gap.
County Executive George Latimer declared that increases in property taxes and county sales tax rates were not foregone conclusions and any member of the press reporting so was “mistaken.”
Latimer commenting on the current upward trend in Sales Tax Revenues through May, said it has to be monitored, and he is not planning to set aside the sales tax receipts surpluses now accruing monthly at present.
The impact of using a property tax cap accumulation of savings achieved through two years of the county being under the tax cap was explored by O’Connor and Davis Partner Nick DeSantis said, as well as the revenue to be gained from a ½% increase in the county sales tax rate, was explored.
DeSantis said because in analyzing the dimensions of the county deficit in the 2018, DeSantis felt his firm should explore with the legislature possible ways to eliminate the looming deficit.
DeSantis said the deficit is $47 Million He said this is the figure if –as little as a a hypothetical 1% retroactive increase in the Civil Service Employees Association (covering approximately 3,000 county workers)–, is agreed on. That 1% would add $16.5 Million to the budget gap of $32 Million.
If the county is unable to keep the raises at 1% the deficit would rear higher than the $47 Million. The CSEA has been without a contract the last 7 years.
After a detailed look at how the county got into this budget deficit, DeSantis, Partner of PKF O’Connor Davis, said the deficit developed because
* The county borrowed to cover pension liabilities since 2012;
* Failed to fund current labor settlements with county high ranking officers in the 2018 budget,
*Used $19.9 Million to furnish those expenses in the county budget for 2018, after the legislature refused to go along with the former Astorino airport lease plan.
DeSantis pointed out in his report to the County Board legislature that the $47 Million longfall in the 2018 budget ahead, could be met by a combination of property tax increase and sales tax rate increase.
He said a county legislator figured that a 5.7% property tax increase would take care of the 2018 budget gap in combination with a ½% increase in the county sales tax rate which he said would gain the county $50 Million to keep and $20 Million to share with towns and villages it collects the sales tax for ($70 Million total). The ½% would have to be approved by the New York State Legislature.
WPCNR emphasizes this combination is just a hypothetical, and Mr. Latimer warned against even thinking the county was going to do this doing this.
The union situation regarding the settlement with the teachers with Westchester County Community College, and the 3,000 CSEA members remained to be settled.
County Legislator Benjamin Boykin told WPCNR that built-in salary increases in the expired previous union contracts and step level increases were paid over the years without a new contract years based and in negotiation were the retroactive increases due on any new contracts remaining to be negotiated.
Asked by WPCNR whether the positive performance of sales tax receipts at the conclusion of 2017 ($520 Million collected through 2017 compared to $505 Million in 2016), and the strong 6% $13 Million gain in sales taxes the first five months of this year, would be used to meet the $32 Million deficit in 2018–
Latimer said it was too early to tell, that the sales tax would be monitored.
Present sales tax receipts for 2018 project, combined with the 2017 surplus in sales tax receipts already amount to a $13 Million surplus and if you figure the 6% can sustain itself the rest of the year, that amounts to a $32 Million gain in sales tax receipts –almost $32 Million.
Asked if the developing surpluses in sales tax receipts month by month might be put in escrow month by month to lower the deficit, Latimer did not say one way or another, saying the county would watch the trend.