Noting that the six villages of the county are the center of commerce for Schoharie County, members of the Village Officers Association Friday asked supervisors to share more of the county’s sales tax revenue with the towns and villages.
Middleburgh Mayor Bill Ansel-McCabe told supervisors that the villages supply many of the services that “help the county to generate the sales tax revenue the county enjoys.”
Mayor Ansel-McCabe, one of three mayors to attend the county board meeting, said he respects the county’s costs but added, “We too are facing rising costs for goods and services.”
The association, Mayor Ansel-McCabe said, wants “to help everyone by increasing commerce.”
The county currently shares five percent of the sales tax collected with the 16 towns and six villages based on assessed valuation.
Association members want the county to share another five percent and this time base it on population.
The measure was strongly supported by some supervisors, criticized by others before they agreed to discuss the issue again next month when there will be more information about the upcoming 2009 county budget.
Cobleskill Supervisor Roger Cohn supported sharing more of the county’s sales tax revenue.
Sharing another five percent would be an “attempt to level the playing field to some extent,” he said.
He said that Fulton, Montgomery and Otsego counties gives back more to their towns and villages.
“It’s time to share,” he said.
Middleburgh Supervisor Dennis Richards supported the change.
“We are not asking for any additional taxes from the taxpayers,” Mr. Richards said Monday.
More than 40 counties in the state share a greater percentage of their sales tax revenue than Schoharie County, he said.
The towns and villages are the municipalities that support the fire departments, the rescue squads and highway departments that affect residents everyday, Mr. Richards said.
If the board agreed to give the towns and villages another five percent of the sales tax, it would total about $700,000.
County Treasurer Bill Cherry said that the county could be facing some severe increases in the 2009 budget that may total $2.5 million for Social Services, fuel, insurance and union contracts.
It is too early to tell about the 2009 budget, but the state may reduce reimbursements which could create a shortfall of $600,000 to $800,000, Mr. Cherry said.
The county’s fund balance is back to 2003 levels and the county could absorb a hit of $700,000, but combined with the increased costs and less revenue, the county would be looking at a hit of $3.2 million if it gave up another five percent of the sales tax revenue.
It would be next to impossible to find an extra $3.2 million, Mr. Cherry said.
Blenheim Supervisor Bob Mann, the head of the county’s finance committee, said unless cuts were made equaling the additional sales tax that would go to the towns and villages, that county taxes would rise.
“We have no choice,” he said. “We don’t print money.”
Using the county’s fund balance is a “temporary fix at best,” he said.
Mr. Cherry said that in the 11 years that the county has shared the sales tax revenue that more than $4.1 million has gone back to the towns and villages.
He said his concern is not for one year.
Over time, he said, the decrease in revenue would have a detrimental effect on the county’s financial condition.
Mr. Cherry added sales tax receipts have been flat and real estate prices are stagnant or falling.
Several supervisors suggested more study on the proposal.
Susan Loden of Wright said in the end that taxpayers could be paying more as some towns could see the extra funds as a “windfall.”
She said the villages of the county may need the extra funds more than the towns.
Board Chairman Earl VanWormer said the board needs to wait before making a decision.
“I’ve like to have all the facts before we head down the road one way or another,” he said.
Supervisors need to assess what the county budget will look like and allow the department heads to make their proposals before making a decision, Mr. VanWormer said.
“We need to consider all options,” he said.
Schoharie Supervisor Martin Shrederis said that supervisors have to look at the county as a whole.
“Can we really afford it?”
It is worth looking at, he added.
Mayor Ansel-McCabe said it would probably take about two years for the change to take effect, if supervisors approved.