Hits: 404
WPCNR QUILL & EYESHADE. By John F. Bailey. Data From the New York State Department of Taxation & Finance August 28, 2019:
The July heat wave did not send city and county residents flocking to the malls and restaurants.
City Sales Taxes receipts were 6.7% lower to start the new fiscal year in July, down $279,762 to $3,883,985 compared to $4,163,747 in July of 2018.
Westchester County July sales tax handle for fiscal year 2019 through the first 7 months rose to $320,357,400 compared to July 2018 through 7 months ($312,561,853). These July County figures just kept pace with inflation.
The new 1% sales tax increase by the County which took effect August 1st according to Westchester County, has not been reported yet and will not be known until mid-September.
Last August through December 2018, Westchester County collected $238,300,628 Million in sales tax receipts.
If you increase that figure by 1%, the amount of revenue of the sales tax increase generated to the county would be $2,380,006, when the county was averaging 5% increased sales tax receipts a month, but it slowed in last 5 months of the year. It had been averaging 5 to 6% growth the first 7 months of 2018.
Total revenue the next 5 months in 2019 to be expected if sales continue at 2.5% growth a month would be $244,258,143. Add the 1% sales tax increase to that and at 2-1/2 percentage sales tax revenue increase, the next five months even following 2.5% inflation would generate $2,442,581, or a total of a possible $246,700,724 over August, September, November and December.
Last year’s county sales tax receipts were $550,562,481. The present mild growth rate of 2.5% (if it continues), will generate a gain in sales receipts to $567,058,481 ( a year to year gain of $16,495,643 or 3%.)
This makes it clear that the county justification for the sales tax increase of 1% does not quite balance the budget. .
Continued strong growth in the county economy balances the budget.
At the present growth rate the county makes up the $15 Million shortfall passed last year by the Democrat-controlled legislature, then settling the union contracts well ahead of the inflation rate retroactively, aggravating the deficit.
The $60 Million deficit was created in part, by the county throwing out the airport lease plan of the Astorino administration and delaying and eventually terminating the Playland lease with Standard Amusements; using fund balance to settle county negotiated contracts; and crossing fingers that the sales tax 1% increase will make up the fund balance bye and bye. You cannot use the same money twice for two different purposes.
The county may be making the classic mistake of betting on a growth rate that may not materialize., they made in the Astorino administration.
Let’s talk about how a 6% growth in sales tax receipts sustained through August, September October, November and December would improve things and if it would balance the budget:
The $238,300,628 from last year’s last five months of sales tax receipts if it sustains a 6% growth rate, would generate $14,298,037 more in sales tax receipts for a total of $252,598,665. The sales tax increase of 1% a month would generate an additional $2,525,986 or a grand total of $255,124,651.
Add that to the $320,357,400 earned the first 7 months through July, and 2019 could generate a sales receipts of $575,482,051, balancing the budget with a $25 Million sales tax receipts increase of 4.5% over last year (which was, as you remember, $550 Million).
That increase only happens if the Westchester economy starts to hum at an average 5 to 6% growth rate. The 1% sales tax increase is insignificant in its effect.
I repeat the Westchester economy is the key
to the county getting out of its budget mess.
So, accelerate your spending Mr. and Mrs. And Ms. Westchester.
Ask not what the county can spend for you, but what you can spend for your county.
Spend, people, spend.
