A report issued by State Comptroller Thomas DiNapoli shows sales-tax collections for 2015 dropped in 30 of New York’s 57 counties outside New York City. While two Hudson Valley counties fit this profile, one bucked the trend well beyond its neighbors.
Ulster County had the third highest increase in sales-tax collections outside New York City last year. Brian Butry is a spokesman for the state comptroller.
“When we looked at Ulster County, they had one of the larger increases in the state at 4 percent from 2014 to 2015. That was an increase of a little over $4 million in their sales-tax collections between the two years,” says Butry. “And most of that can be attributed to a change in their sales-tax rate between the two years. They had gone back to a 4 percent sales tax in 2015, January 2015, after a temporary decrease the year prior.”
In addition to Ulster, there were three other counties outside New York City with an increase of more than 3 percent: Hamilton, Saratoga, and Steuben. Ulster County Comptroller Elliott Auerbach calls the increase a far cry from 2014, when the county saw an increase of just a few hundred thousand dollars. He says the increase in 2015 has a trickle-down effect on the 20 towns, two villages and City of Kingston, which share in the gain. Meanwhile, county officials are in discussions with town leaders and Kingston’s mayor to address the sales tax revenue sharing agreement, which is set to expire at the end of the month. The issue has been contentious in recent years.
The rest of the Hudson Valley counties that experienced increases did so by less than 3 percent. On the flipside, Putnam is one of 10 counties statewide and the only one in the Hudson Valley that saw a decrease of more than 3 percent. Sales tax is Putnam County’s top revenue source.
“In 2014, we collected $55,885,000 and in 2015, we collected $53,954,000,” Carlin says. “Now, according to data we got from the New York State Association of Counties, the county actually collected $2 million less in 2015 due to the sales tax derived from motor fuels at our gas stations. So it’s obvious that the plummeting gas prices have taken their toll on the county sales-tax revenue.”
That’s William Carlin, who is Putnam County’s commissioner of finance.
“If this is indeed now the new normal instead of a short-term trend, when the 2017 budget process begins in just a few short months from now, we’re going to have to take that into consideration, and it may affect the services that the county provides its residents,” says Carlin.
As for counties in other regions of the state that experienced sales-tax collection decreases, Butry offers a general explanation.
“With some of the areas in the state, what we’ve seen is some uneven economic recovery from one region to another,” Butry says. “For example, this year’s largest decreases in sales-tax collection were mostly in the North Country, in far upstate New York, the counties on the border with Canada there as well as those in the Southern Tier. And these generally tend to be more rural communities.”
Carlin is pinning the decrease predominantly on lower gas prices.
“We’re highly rural and just about everybody drives and everybody needs gas,” Carlin says. “And I think that’s the bulk of where our problem now lies.”
Westchester is the only other Hudson Valley county to show a decrease, and it was less than 1 percent.