No Sales Tax Break; Putnam to Share Revenue With Towns & Villages

By Holly Crocco

The Putnam County Legislature last week approved a resolution requesting the state to pass legislation extending the county’s additional 1 percent sales tax, while also mandating that one-ninth of the revenue generated from that 1 percent be allocated to the towns and village in Putnam County.

It will be distributed based on population, with each municipality guaranteed a minimum of $50,00 to be used exclusively for local infrastructure and capital projects.

Last month the Legislature passed a resolution seeking to reduce the county’s sales tax rate by a quarter of a percent ($5 million), but that resolution was vetoed by County Executive Kevin Byrne, who later announced a “historic agreement” with all the town supervisors and village mayors to share sales tax revenue.

Essentially, that’s what the County Legislature was voting on last week.

The consensus among lawmakers was that, after much negotiations and, (let’s just call a spade a spade) fighting, amongst themselves and with the county executive over various different proposals on how to share the county’s “wealth,” they weren’t entirely happy with the final compromise but were willing to approve it so some relief can be realized.

The vote passed 7-1, with Legislator Paul Jonke, R-Brewster, the lone opposing vote. (Legislator Dan Birmingham, R-Southeast, abstained from the vote due to a conflict of interest.)

“I’ve been opposed to the extension of the full 1 percent because we don’t need the money,” said Jonke.

He said he disagrees with the county executive’s opinion that if the extension isn’t maintained it will jeopardize critical infrastructure projects and public services. “That money has already been set aside,” he said. “We don’t need additional sales tax revenue to pay for those projects.”

Jonke said both sales tax and property tax relief can be offered.

“I just think we could do more and when we have an opportunity like we do in front of us today, we should take advantage of it and show the public that we’re serious about cutting their taxes. We have an (unassigned) fund balance that sits today at $90 million… The first thing we need to do is stop taking the money from the taxpayers.”

Legislator Nancy Montgomery, D-Philipstown, said that while she originally proposed and supported a different way to offer tax relief to residents, after five months of deliberations, she’s learned that “governing isn’t about holding rigidly to one idea but adapting and moving forward in the best interest of our residents… Let’s get over the fact that we don’t like the way it happened.”

Legislator Toni Addonizio, R-Kent, expressed frustration that the county executive’s “historic” proposal was never formally presented to the Legislature for approval, and that an alternative that the Legislature proposed which would have shared $5 million two years in a row with municipalities didn’t get traction.

“That proposal would have more than doubled the financial benefit to our communities, but it would have been vetoed by our county executive – that’s is why it didn’t move forward,” she said.

Legislator Greg Ellner, R-Carmel, agreed that although it was not his first choice, the Legislature was in a position to either offer some relief, or none at all.

“We’ve gotten here. Even though I don’t like the way we’ve gotten here,” he said. “I’ve been saying all along these are two mutually exclusive issues – two issues that don’t need to be handled together, and that’s what I don’t like.”

Legislator Amy Sayegh, R-Mahopac Falls, said the county has been pinning the towns against the taxpayers.

“The towns consistently ask for more money, but these are two distinct issues that should be voted on separately,” she said. “We can lower the sales tax for the taxpayers, though the county executive will probably veto that again. We can also share funds with the towns, and there are multiple plans that we could consider or that we have considered, including sharing the undesignated fund balance.”

However, Sayegh said, “It’s the taxpayer who receives no sales tax relief. It’s the taxpayer that is left out of this historic compromise. I was elected to serve the taxpayers, and they deserve a break.”

While she said she’s in favor of keeping part of the sales tax extension to share that revenue with the towns, she would have also liked to see consumers keep some of the sales tax in their pockets.

“It’s take it or leave it,” she said of the resolution before them. “That’s our vote here tonight – shoved down our throats from Albany politicians. It’s another unfunded mandate.”

Legislator Erin Crowley, R-Mahopac, called the resolution “a good start.”

“Could we always do better – should we always do better?” she asked. “Absolutely. But this is a start and it’s more than we’ve ever done before.”

After the vote, Byrne released the following statement:

“While I understand this compromise may not have been everyone’s first choice, it was the best choice before us. The alternative was allowing the county’s sales tax rate to drop, immediately creating a revenue shortfall of tens of millions of dollars, forcing the county to borrow, raise property taxes, or both. Needless to say, Putnam County’s credit rating and long-term financial outlook would have suffered as a result.

“I intend to sign the home-rule resolution immediately so that the county can send it to our state delegation for final consideration by the respective chambers of the State Legislature.”