Sales tax down, property taxes up in Chenango
NORWICH – County sales tax revenues were down and property taxes were up in 2015, setting the stage for a tough financial year ahead, according to county administrators.
Recent reports from the New York State Tax Department show that sales tax revenue in Chenango County dropped by nearly one percent, or $200,000 over the last year. Despite early predications of a possible 1 percent sales tax revenue increase back in October, the months of November and December brought in less revenue that county officials had expected.
Sales tax revenue in Chenango has struggled to bounce back since the economic downturn in 2008, according to County Treasurer William Craine. Any growth in recent years has been minimal – about one percent per year.
“We didn’t see the growth we hoped for at the end of the year. It’s going to be interesting to see what heppens in the January and February reports,” said Craine.
The State Tax Department report also shows surrounding counties in a similar situation, some down as much as six percent. Cortland, Broome, Delaware, and Otsego counties were all in the red by year’s end. Madison County saw some growth, but only by a marginal one percent.
In 2015, 12 counties throughout the state collected less in sales tax revenue than they did in 2013. For 11 other counties, while not negative, they averaged less than 1 percent growth per year in sales tax receipts between 2013 and 2015.
At the same time, the Tax Foundation reports that New York ranked first in the country when it comes to the 2015 state and local tax burden. New York had the highest combined state and local tax burden in the country in 2011 and 2010, as well.
According to the most recent report, New Yorkers spend 12.7 percent of their income paying combined state and local taxes. Gov. Andrew Cuomo has called on local municipalities to combine services and form intermunicipal agreements to save taxpayers money. He has even offered a $20 million incentive to the governments that agree to consolidate and whose plan would bring about the greatest permanent reduction in property taxes.
But the best solution to high property taxes may not be through consolidation, said Craine.
“New York is the only state in the country that requires each municipality to contribute to Medicaid,” he explained.
Approximately 15 percent of Chenango County’s revenues go to the state for the purpose of Medicaid. Craine proposes that the state foot the entire cost of Medicaid. Doing so would decrease the county’s tax bill by as much as 40 percent.
“The Governor wants us to be more efficient, and that’s one of the ways that we could be a lot more efficient,” he added.
Facing a possible 0 percent tax cap for the 2017 budget year, Craine said there’s concern from the county about how officials are going to meet their obligations when they begin the budgeting process later this year – especially considering the nominal increase in sales tax revenue which helps offset increases in property taxes.
“We could be looking at a very marginal tax cap increase,” he said. “We’ll have very little tax cap movement and very little if any sales tax movement, so it will make it a very difficult year in adhering to the cap. We’re still going to work to that end, but it will be difficult.”
Recent reports from the New York State Tax Department show that sales tax revenue in Chenango County dropped by nearly one percent, or $200,000 over the last year. Despite early predications of a possible 1 percent sales tax revenue increase back in October, the months of November and December brought in less revenue that county officials had expected.
Sales tax revenue in Chenango has struggled to bounce back since the economic downturn in 2008, according to County Treasurer William Craine. Any growth in recent years has been minimal – about one percent per year.
“We didn’t see the growth we hoped for at the end of the year. It’s going to be interesting to see what heppens in the January and February reports,” said Craine.
The State Tax Department report also shows surrounding counties in a similar situation, some down as much as six percent. Cortland, Broome, Delaware, and Otsego counties were all in the red by year’s end. Madison County saw some growth, but only by a marginal one percent.
In 2015, 12 counties throughout the state collected less in sales tax revenue than they did in 2013. For 11 other counties, while not negative, they averaged less than 1 percent growth per year in sales tax receipts between 2013 and 2015.
At the same time, the Tax Foundation reports that New York ranked first in the country when it comes to the 2015 state and local tax burden. New York had the highest combined state and local tax burden in the country in 2011 and 2010, as well.
According to the most recent report, New Yorkers spend 12.7 percent of their income paying combined state and local taxes. Gov. Andrew Cuomo has called on local municipalities to combine services and form intermunicipal agreements to save taxpayers money. He has even offered a $20 million incentive to the governments that agree to consolidate and whose plan would bring about the greatest permanent reduction in property taxes.
But the best solution to high property taxes may not be through consolidation, said Craine.
“New York is the only state in the country that requires each municipality to contribute to Medicaid,” he explained.
Approximately 15 percent of Chenango County’s revenues go to the state for the purpose of Medicaid. Craine proposes that the state foot the entire cost of Medicaid. Doing so would decrease the county’s tax bill by as much as 40 percent.
“The Governor wants us to be more efficient, and that’s one of the ways that we could be a lot more efficient,” he added.
Facing a possible 0 percent tax cap for the 2017 budget year, Craine said there’s concern from the county about how officials are going to meet their obligations when they begin the budgeting process later this year – especially considering the nominal increase in sales tax revenue which helps offset increases in property taxes.
“We could be looking at a very marginal tax cap increase,” he said. “We’ll have very little tax cap movement and very little if any sales tax movement, so it will make it a very difficult year in adhering to the cap. We’re still going to work to that end, but it will be difficult.”
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