New York State Comptroller Tom DiNapoli is renewing warnings about the financial impact of the COVID-19 pandemic on local governments.
In a report released Thursday, the Democrat finds statewide local sales tax collections declined by 24% in April and 32% in May and will likely continue to decline over the next several months. From March through May, local governments have received $824 million less in sales taxes than they did during that same period in 2019.
DiNapoli said, “Local governments can only tighten their belts so far. They need federal aid and they need it now.”
New York state’s 2020-2021 budget held most forms of state aid at about the same level as the previous year, including school aid. But school aid is subject to a “Pandemic Adjustment,” a reduction of $1.1 billion. The state budget also included provisions that give Governor Andrew Cuomo unprecedented power to reduce spending. The state budget also includes an initial “gap-closing plan” that would reduce aid to localities by $8.2 billion.
