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WPCNR QUILL & EYESHADE.  By John F. Bailey. Based on NY State Dept. of Taxation & Finance Statistics. December 4, 2018:

Westchester County Sale Tax Receipts experienced a lackluster October that was expected to be bolstered by start of school and consumer returns from vacation.

As the County Legislature prepares to approve the county budget, the approximate 6% increase in sales tax receipts has failed to continue into the fall.

The  County sales tax dollar momentum in July started to slow with a 4.7% increase over 2017  after demonstrating a strong 6% trending through the first six months.

In August  the county had its first decline compared to 2017—declining $400,000 from 2017 figures. In September, there was a ½% increase.

The figures for October,  from the State of New York  put in doubt whether the County Budget Department  estimate of $578 Million in sales tax dollars 4 weeks ago will be met.

WPCNR previously estimated that the county would hit the $550 Million level, (if 6% were sustained the last four months of the year.

Now with a very soft  2018 October of $41,374,329 , (1.5% more than October 2017), the trend of softer retail activity has to be of some concern.

The Department of Taxation and Finance does hold out hope that figures are not reconciled until the final month of the quarter, and there may be some  dollar lag.

• The Westchester economy would have to generate a 35% lift over sales tax dollars received in November and December of 2017 ($95 MILLION in the two months of Nov-Dec in 2017 with 33.3 Million above that $95 Million) to break over the $578 Million figure estimated by the county in early November.
• More realistically, a 12% Gain (returning to the growth sustained through the first 7 months of the year over the Nov-Dec totals last year)would create $106 Million(over last year’s final two month total of $95 Million  ) would generate a handle of $556.5  Million way off $578 Million
• A 15% gain would create an additional $14 Million more plus the $95 Million and put the county at $559 Milion.
• A 20% gain would mean $19 Million more over the 95 Million over the next two months and  $564.2 Million.
• A 25% gain over last year’s $95 Million would add $23.8 Million and we’d be getting close: $569 Million
• A 30% gain over $95 Million would add $28.5 Million and get County Sales Tax dollars to $573.7 Million
• A 35% gain over $95 Million would add $33.3 Million (a total of $128 Million) and hit the target $578.4 Million

 

(Note: the above calculations start from the sales taxes generated so far this year $449,943,467. To that figure WPCNR figured what a 12%, 15%, 20%, 25%, 30%, and 35%  increase in the $95.2 Million collected in November and December last year would bring in  then added those % increases to $95.2 Million and added the sum to $449,943,467 to figure roughly what the county needs to come close to their projection of $578 Million)

How likely is it that the receipts are way late in coming in in October?

Is it plausible the $95 Million generated the last two months of 2017 will grow by  $33.3 Million more generating the $128,511,517 needed to hit the $578 Million?

That  requires a lot of consumer buying, about $16 Million more in sales tax dollars each month over last year.

I  hope there is just a big delay in reporting in October to account for that anemic growth of 1.5%

The gruesome October figure of 1.5% was unfortunate had October rebounded to the 6% level of growth, the October handle would have been $2,446,437 more for the kitty.

A 15% Gain would put the county at $559 Million;  20% Gain in Nov-Dec would generate $564.2 Million. A 25% gain, had October been a rebound month.

The County Legislature may be wrestling with devoting the $25 Million surplus generated so far fully to fund balance to stabilize the county’s bond rating which the rating agencies lowered slightly. Or they could devote the surplus to cover the $35 Million existing at the end of 2018.

However the bigger picture that fall numbers are flat with last year’s pace is more sobering looking to county revenues in 2019. The county will definitely need an increase in the sales tax rate, or a BnB tax or an Uber/Lyft tax to keep pace.

Unless of course the county has been promised $578 Million in sales tax already, and the county knows that figure is coming. It is a mystery how the county arrived at the $578 Million figure even when the 6% trend did not compute to that high a figure.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WPCNR REALTY REALITY. From the Westchester County Industrial Development Agency. December 4, 2018:

 The Westchester County Industrial Development Agency (IDA) has unanimously approved a resolution of intent to provide financial incentives for a $76.8 million transit-oriented, mixed-use residential project to be built next to the Metro-North train station on Halstead Avenue in Harrison.

At its November 29 meeting, the IDA Board approved $1,352,966 in sales tax exemptions for Avalon Bay Communities to develop the three-building complex which consists of 143 rental units, seven affordable units, 27,000 square feet of commercial space and 758 on-site parking spaces. The project also includes two landscaped plazas connecting the train station platform with Halstead Avenue. Monthly rents for the apartments are estimated at $2,500 for one bedroom and $3,000 for two bedrooms. The exterior design takes cues from existing storefronts opposite Halstead Avenue and will complement the Halstead Avenue streetscape. The project, which will be built in two phases over a 30-month period, is expected to create 410 construction jobs and 8 permanent jobs.

Avalon Communities is also constructing a parking garage on a lot adjacent to the residential building that is owned by the Metropolitan Transportation Association (MTA). The garage will have 475 spaces owned by the MTA for commuters, 77 spaces for residents of the residential project and 46 spaces for the commercial users.

“The IDA is pleased to provide financial incentives to Avalon Communities for this innovative   transit-oriented development that will bring new rental housing and retail space to downtown Harrison as well as improved access to the Metro-North train station. We are also pleased that this project will create more than 400 new construction jobs for the County,” said Bridget Gibbons, Director of the Westchester County Office of Economic Development.

In other business, the IDA board approved resolutions for final authorization for financial incentives for two residential projects in White Plains. The projects are:

131 Mamaroneck Avenue & 1 Mitchell Place (The Bridgestone) is a $223.4 million mixed-use residential development in downtown White Plains comprised of 434 rental apartments and approximately 8,000 square feet of retail space in three multi-story buildings with parking and other amenities.  Twenty-seven of the apartments will be affordable. The IDA is providing project developer Lennar Multifamily Communities with $27 million in real estate tax benefits, $3.25 million in sales tax exemptions and $1.5 million in mortgage recording tax exemptions.

 

440 Hamilton Avenue is a $203 million mixed-use residential development in downtown White Plains that involves the adaptive reuse of a 12-story office building for construction of 255 apartment units and 2,420 square feet of commercial retail space. Six percent of the units will be affordable at 60% of Westchester County Area Median Income (AMI). The plan also calls for developing an adjacent surface parking lot on Barker Avenue with an apartment building with

213 units and parking for the project’s residents and associated retail space. IDA benefits include $3,335,400 in sales tax exemption and $1,685,630 in mortgage recording tax exemption.