Republican members of the New York Senate and Assembly were joined by officials from New York’s education community in calling on Governor Hochul and the Legislature’s Democratic majorities to pause the 2027 statewide implementation of the electric school bus mandate to allow for the completion of a pilot program, cost-benefit analysis, and other feasibility assessments.
The electric school bus mandate, enacted in 2022, requires new school bus purchases to be zero emission by 2027 and all school buses in operation to be electric by 2035. There is no provision made for the geographical disparities, diverse weather conditions, or unique travel demands of the state’s school districts. In addition, this is another mandate from Albany that burdens cash-strapped school districts and taxpayers.
“As the 2027 implementation date of New York’s electric bus mandate approaches, school officials in my district and around the state are becoming increasingly concerned about the tremendous financial and operational challenges associated with this one-size-fits-all requirement,” said Senator George Borrello, SD57.
“This mandated conversion will have a price tag in the billions, with New York State taxpayers simply expected to foot the bill. said Sen. Borrello. “Like so much of the state’s climate agenda, there is no cost-benefit analysis of this mandate or any realistic plan for how to pay for it.”
“Electric buses cost up to three times as much as conventional buses -- it’s a difference of $130,000 versus $400,000-$450,000. Additionally, electrical infrastructure and distribution line upgrades can add hundreds of thousands of dollars or more. The conversion cost has been conservatively estimated at between $8 billion and $15.25 billion more than the cost of replacing them with new diesel buses. However, the multi-million dollar estimates utilities are now providing to some school districts just for the electrical upgrades suggests the total costs will be much higher than $15 billion,” said Sen. Borrello.
“The EV school bus mandate is the Mother of all unfunded state mandates. At a time when our state is bleeding billions of dollars because of the migrant crisis and school aid cuts are hitting rural and suburban districts, neither our schools nor our taxpayers can shoulder crushing new costs,” said Assemblyman Phil Palmesano, AD 132.
He noted the state allocated just $500 million in the most recent Environmental Bond Act to assist schools with the conversion costs of the state’s 50,000 buses.
Assemblyman Palmesano and Senator Thomas O’Mara are sponsoring legislation that would, among other things, require the Commissioner of Education to complete a cost-benefit analysis for each school district that takes into account the costs necessary to comply with the zero-emission school bus mandate.
Legislators cited other problems associated with electric vehicles that are gaining increasing attention and adding to concerns about investing taxpayer funds in the conversion. Those problems include:
- Inability to operate or charge in frigid temperatures, as a well-publicized incident in Chicago in mid-January underscored. Designed to operate best in 70-degree temperatures, electric vehicles lose up to 40 percent of their traveling range in extreme cold and the time required to charge them is much longer. A pilot program in Vermont found traveling range decreased by 80 percent in some instances;
- Poor reliability. School districts engaged in pilot programs and agencies operating municipal buses have reported many electric buses are “gathering dust” in bus garages as a result of numerous mechanical problems and hard-to-access parts and technical support. A study by Consumer Reports found that electric vehicles have 80 percent more problems than conventional vehicles.
“While many states around the nation are wisely testing the feasibility of electric buses for their regions through pilot programs, New York Democrats rushed to enact a mandate without any firsthand data on whether it would meet the needs of our districts. This is a movie we’ve seen before in Albany and it never ends well,” said Senator Borrello.
He noted that he is proposing legislation, Senate Bill 8467, that would rescind the mandate and replace it with a state-funded pilot program that would allow schools to test how these buses perform. A condition of the pilot program is that buses be sited in all three types of settings, rural, urban, and suburban so that their performance can be evaluated. At the end of one year, a report on the program would be presented to the executive and legislature.
“The zero-emission bus mandate for schools is at present unworkable and fiscally catastrophic for rural schools. While the goal is laudable, issues with the feasibility of the vehicles, capacity of the power grid, and fiscal commitment by the state all currently prevent compliance. The proposed legislation is a common sense approach that will answer the needed questions prior to making promises neither the state nor the industry can keep,” said David Little, Executive Director of the Rural Schools Association.
“The goal of having several clean energy options is a good one, but it’s got to be done with common sense and in a realistic way that’s reasonable and affordable for taxpayers, our local governments, and school districts and not add to the high tax burden faced by New Yorkers. We’re offering a reasonable proposal to rescind the electric school bus mandate that will cost school districts in New York State billions of dollars, and replace it with a state-funded pilot program that enables school districts to test and evaluate how these electric buses perform,” said Senator Jim Tedisco, Ranking Member on the Senate Education Committee.
“Rural, upstate schools need more funding to focus on educational services, not an expensive mandate that would raise taxes and divert resources away from students,” said Senator Dan Stec, Ranking Member on the Senate Environmental Conservation Committee. “Green initiatives are laudable, but the electric bus mandate runs counter to the realities our schools face. I’ve heard repeatedly from school superintendents that it simply isn’t feasible. Instead of punishing our schools with an expensive mandate for buses that may prove unreliable, let’s take a step back and replace it with a pilot program that would evaluate the efficacy of electric buses statewide.”
“School districts across New York are already struggling under the weight of excessive state mandates, yet Albany Democrats always seem to find new ways to add to their burden. In my rural senate district, where bus routes can take hours to complete, it is unreasonable to force schools to move forward with untested electric buses that may not be up to the demands. Add on top of that the cost, at a time when many districts are struggling to stay afloat, and we are looking at an entirely unworkable proposal. Senator Borrello’s legislation calling for a pilot program, rather than another Albany mandate, is the best solution,” said Senator Peter Oberacker, 51st Senate District.
“My local schools are raising the alarm about this mandate and we should listen to them. It’s unrealistic, uninformed, and irresponsible. Districts are planning now for how to implement and afford it, with little guidance or funding from the state. We’re talking upwards of $400,000 for just one bus, plus more for the needed infrastructure, not to mention whether our electric grid has the necessary capacity. I want to do everything we can to protect our environment, but this mandate is impractical. Let’s be smart about this and let’s protect our students, schools, and property taxpayers,” said Senator Pam Helming, 54th Senate District.
“These proposals are each common-sense alternatives that would determine if an electric school bus mandate is affordable, reliable, and, most importantly, feasible. Our school children should not be used as the test subjects for this costly and risky mandate,” said Senator Borrello.
Congresswoman Claudia Tenney (NY-24) unveiled her agriculture plan and tax plan that work to support small and locally owned businesses and family farms across New York’s 24th District.
Earlier this month, Tenney visited multiple family farms and local businesses in Cayuga County and Wayne County to discuss their concerns and the Congresswoman’s efforts in Congress to support our farming and business community. To outline her work to support our NY-24 producers and employers, Tenney unveiled her three-pillar agriculture plan and tax plan.
Her agriculture plan focuses on supporting NY-24 specialty crops, bolstering New York’s dairy industry, and protecting American farmland from foreign interests. Her tax plan centers around her work on the House Ways and Means Committee to build on the successes of the Tax Cuts and Jobs Act, revitalize our communities, support our families, and ensure essential taxpayer protections.
“Small businesses and family-owned farms will always be the backbone of NY-24’s economy,” said Congresswoman Tenney. “I’ve toured numerous small businesses and farms across the district to learn more about their daily operations and the challenges they face. It is imperative that we put forward policies in Congress that address these concerns and deliver lasting results for our community. Today, I released my agriculture plan and tax plan to highlight my efforts to unleash the potential of our rural communities and to give farmers, producers, and small business owners the certainty and opportunities they need to succeed.”
To view Tenney’s full Agriculture plan, click here.
To view Tenney’s full Tax plan, click here.
Congressman Chris Jacobs (NY-27) cosponsored the Protecting Family and Small Business Tax Cuts Act to make the 2017 Trump tax cuts permanent.
“Following the implementation of President Trump’s tax cuts, our nation witnessed an extraordinary period of economic expansion, wage growth, and job creation,” Jacobs said.“Businesses were bringing manufacturing back from overseas, employers were using savings from the federal government to hire additional employees, and our nation saw our output and productivity increase.”
The legislation co-sponsored by Jacobs most notably:
- Make permanent the doubled standard deduction of $12K for those filing single and $24K for jointly filed returns
- Make permanent the doubled child tax credit of $2K including full refundability of $1400
- Maintains the mortgage interest deduction at $750K
- Maintains the Medical Expense Deduction to allow the deduction of qualified expenses that exceed 7.5 percent of an individual’s AGI
- Provides a 20 percent tax deduction for small businesses
“Since taking the White House and majority, Democrats have made clear they want to undo these successful policies and force through policies that waste trillions of dollars and raise taxes on Americans,” Jacobs said. “We have already seen the disastrous impact of their policies on our economy. I am proud to join this legislation to ensure a successful Trump policy is made permanent so it can continue to help families and small businesses in the future.”
From Sen. Ed Rath:
It is no secret that New Yorkers pay some of the highest taxes in the nation. Unfortunately, it does not look like there will be any reprieve in our 2021-22 budget, despite the influx of aid coming from the latest round of stimulus funding.
A report recently found that New York State has the third highest tax rates in the nation. New York continually ranks as among the worst states for taxes and for business climate. This needs to change!
News of the Federal aid coming to New York as part of the American Rescue Plan, seemed promising for residents. However, the Governor has made it clear that tax increases are not off the table. In fact, the Governor's budget proposal includes eliminating the State income tax reduction for the middle class.
Now is not the time to be raising taxes on hardworking New Yorkers. Many businesses and families are feeling extreme financial pressure and raising taxes will only make these matters worse. We should be working to jump start our struggling economy by helping businesses reopen and rehire.
I will continue to keep you updated on the progress of the New York State budget and will continue to fight for policies that make New York more affordable for hardworking families and small businesses.
Genesee County is outperforming many other municipalities in New York when it comes to getting the highest possible return on tax dollars, a financial consultant told members of the Legislature this week.
Over the past year, the county has earned almost $1.6 million by adroitly managing cash flows and placing cash reserves in investments with the best returns while minimizing risk and complying with state regulations.
With a $32 million tax levy, that return is about 4.77 percent, which means lawmakers can keep the property tax rate lower. If they wanted to generate an additional $1.6 million in property tax revenue, they couldn't do that without violating the state's tax cap.
The reason: "The county treasurer is willing to step out of the box and do whatever it takes to help the taxpayers," said Garrett Macdonald, a Genesee County resident who is vice president of Three+1, a financial consulting firm based in Pittsford.
Also, Macdonald said the county is "looking at data more intuitively and making sure that we're really looking under every stone to earn more. A lot of times (with) public entities, it's not the first priority to earn more on taxpayer dollars.
"The first priority is to make sure it's safe, to make sure that it's in deposit, that the money gets somewhere that it's recorded. And then budgeting is important. Treasury always is kind of a second priority.
"But in Genesee County's case, they're able to accomplish all the above. So looking at data, working with their banks, really putting treasury and earnings at the top of the priority list, along with safety, legality, liquidity."
Because there is money coming in before it's needed for public services, and because the county is required to maintain a cash reserve, there is always cash on hand.
What a government agency can do with it is regulated by the state, and among the things the county can do is buy treasury bills -- place it in money market accounts or certificate of account registries, or other safe and liquid investment vehicles. There are about seven options in total.
Treasurer Scott German spends time every week looking at the data and working with Macdonald on what the county's portfolio should look like based on market conditions and cash flow needs.
"I want to get the biggest return I can for the taxpayer," German said. "Therefore, using his information that he is able to provide, his negotiations with other banks, we are able to maximize the returns for the taxpayers.
"I mean, you compare me to probably any other county in the State of New York, I'm probably doing probably double or triple in interest rates, percentage-wise."
Macdonald said the county's return is well above the 1.5-percent benchmark local agencies should try to achieve, and that most municipalities struggle to get a 1-percent return.
There's one government agency, he said, that has a tax levy $26 million higher than Genesee County's and is generating $600,000 in investment income, less than half of what Genesee County is generating. And that's the next largest total dollar return in the comparison group.
"The biggest point that I will hone in on again and just reiterate: our goal is to maximize the value that the public creates through tax dollars," Macdonald said. "If we can do that through generating new revenues, that doesn't include increasing taxes, that's a big win."
Among economists, there has been a lot of talk about the inverted yield curve (a graph tracking returns on long-term and short-term bonds; when the economic outlook is good, long-term rates are higher than short-term rates; when the curve inverts, it's a sign investors have lost confidence in long-term returns). The curve inverted last quarter, which is a possible sign of a coming recession.
Macdonald believes the bond markets are correcting and he doesn't see a recession on the two-year horizon (in the past, when the yield curve has inverted, there has been a recession within 18 months). That said, if there is a recession in the next year, because of the money management practices of German, Genesee County's funds should be protected.
Financial markets are always cyclical, Macdonald noted, which is why it's important to stay on top of what is going on every week.
"If we have a recession in two years, I think the impact is yet to be known because we don't have money invested for two years," Macdonald said. "The longest we have money invested for the county's about one year.
"But when I can tell you is, looking into 2020, even though rates have gone down three times -- once in July, once in September and then once in October -- it's because we've been proactive and because Scott's been proactive at investing early before those decreases.
"We're still going to beat benchmarks going into 2020. So, where most counties are being reactive, Genesee County is proactive."
A proposal to reduce funding from the state for towns and villages, known as AIM (Aid and Incentives for Municipalities) could wind up as just another cost burden for Genesee County, County Manager Jay Gsell told the Ways and Means Committee at its meeting Wednesday.
If the funding cut goes through, the County could make up the $230,000 in difference for towns and villages from its own revenue.
Gsell said the governor’s office is being somewhat disingenuous about how cuts are being presented to municipalities.
What the state says it will do and what it actually does will be two different things, Gsell suggested.
The governor’s office is proposing a new sales tax on products sold digitally, an e-commerce tax, and that new revenue stream -- the theory goes -- will allow counties to share a portion of sales tax with municipalities.
Genesee County is one of the few counties in the state that currently shares sales tax but the proposal by the governor would mandate an obligation, perhaps above current revenue sharing, and force the rest of the counties to start sharing sales tax.
But there’s no guarantee New York will be successful in instituting an e-commerce tax – something state officials have sought for years, and it would certainly be difficult, Gsell said, to institute before the state’s new fiscal year starts April 1.
That could leave the counties, including Genesee County, with another unfunded mandate.
Under the governor's budget proposal, only municipalities that use a lower percentage of AIM for their annual budget would have funding cut. If that holds, neither the Village of Le Roy nor the City of Batavia, which receives more than $1 million in AIM funding, would have that funding cut.
The Legislature will be asked to vote on a resolution opposing the proposed cut to AIM.
Genesee County Treasurer Scott D. German is pleased to announce that Genesee County residents (outside the City of Batavia) now have online access to their Town/County property tax information. This website: http://genesee.go2gov.net can be used to inquire on the status of their taxes, review payment history or make payments online with credit or debit cards or an e-check. A convenience fee will apply for online payments.
Tax information can be looked up by: the property owner’s name; property address; mailing address; or by tax ID number. The site is very easy to navigate and can provide very useful tax information.
Everything on the website is information already available to the general public.
As always, anyone with any questions can contact my office at 585-815-7803.
The commander of the Veterans of Foreign Wars in Alexander is on a mission to get the Alexander School District to reconsider implementing a tax exemption for Cold War veterans.
Eric Radder spoke at Wednesday's school board meeting.
"I notice we’ve got all four service flags up here, so obviously Alexander supports its veterans," Radder said. "I’m here to discuss and implement it and bring it back as a point of discussion."
Several tax jurisdictions in the county have adopted the exemption, including the Town of Alexander and the Village of Alexander.
Qualified veterans who apply can get an exemption on a small portion of the assessed value of their property. The typical exemption is 10 percent off the accessed value with a maximum of $6,000 exempt from the jurisdiction's property tax. In Alexander, both the town and village adopted the higher tier exemption, which is 15 percent off the accessed value with a maximum exemption of $12,000.
More than two years ago, the school district held two public forums on the proposed exemption. The first forum, said Board President Reed Pettys, was lightly attended because of a snowstorm. The next forum had 30 to 40 people attend, Pettys said, and the public was evenly divided between support and opposition.
While the perception is that the Alexander School Board voted against the exemption, Pettys said since the community was divided on the topic, the board just never took the issue up again.
Pettys agreed Wednesday night to go with another board member to the VFW's board meeting Thursday to publicly discuss the proposal again.
He said a lot has changed since the board last considered the idea -- there are two or three new board members, including one -- John Slenker -- who is a veteran and more jurisdictions, including other school districts, have passed it.
"I think we’ll discuss it at the next meeting and see if we can get a public forum," Pettys said.
The exemption, Radder said, would help keep veterans in the community.
"You could retain the veterans who bring a set of values that they learned in their military training experience and then in return benefit the community at large," Radder said.
There have been several phone calls to my office regarding the pre-payment of 2018 Town/County property taxes to be paid to the Town Tax Collector before Dec. 31, 2017.
- The new Federal Income Tax Law will only affect an estimated 10-15 percent of the population in Genesee County as far as the SALT deduction. The law allows taxpayers to deduct up to $10,000 a year in a combined New York State income tax and property taxes. So if your deduction of those taxes are less than the $10,000, it probably doesn’t make sense to pay your 2018 taxes early. For example, if your 2018 town/county, school and village taxes are $2,500 and your total New York State taxes paid will be $3,500 = $6,000. Total taxes paid are $6,000 which is less than the maximum $10,000 allowed; therefore your taxes would still be deductible on your 2018 tax return.
- It is unclear whether or not the IRS will allow a deduction of pre-payment of 2018 taxes on your 2017 tax return; please consult your tax accountant for clarification.
- The tax bills are effective for the county fiscal year of Jan. 1, 2018 – Dec. 31, 2018. Payment for these taxes should be made Jan. 1 or after.
- This law has no effect on residents of the City of Batavia since city/county tax warrant isn’t until May.
(Photo: Chris Collins during a meeting today at the Job Development Center in Batavia.)
Rep. Chris Collins thinks he has the proof he needs to label Gov. Andrew Cuomo now and forevermore a pathological liar.
Following a meeting with county employment officials at the Job Development Center in Batavia, Collins took questions for reporters and in response to comments by Cuomo that the recently passed House tax reform bill will cost New Yorkers money, Collins immediately launched into a prolonged attack on Cuomo for claiming he had spoken with Collins about the bill.
"He attributed a quote to me that said that I said the reason I voted for the tax act was that I was pressured by Republican leadership," Collins said. "As I said, and it’s in The New York Times today, 'liar, liar pants on fire.' In seven years, I’ve never spoken to the governor. I certainly did not speak to him on this. Aand the outrageousness of him even fabricating a quote will tell you, if he will lie about something like that, he will not hesitate to lie about our tax plan."
The Batavian reached out to the governor's office for a response and received this statement:
The Governor's point was the Republican congress members he spoke to said they were under pressure from their political leadership to vote yes. Collins and the rest of the New York Congress members who voted for their donors and against their own constituents can try to deflect from this irresponsible vote, but it's the Governor who stood up for New York taxpayers and always will.
Contrary to Cuomo's assertions about the reforms, the changes in the tax code will save most of his constitutes money Collins promised.
"I have said I will stake my career, my election next year, on the fact that 95 percent of the folks in GLOW and Erie County will pay less in taxes," Collins said. "If you do, then vote for me, and if you don’t, then don’t vote for me."
He challenged Cuomo to make the same pledge.
"If under our plan you pay more, then the governor was right and you should re-elect him, but next year when 95 percent of my constituents pay less, I would expect them to vote against our governor because he’s lying to them," Collins said.
Why isn't every single taxpayer in the NY-27 saving money? Collins explained it this way: If you're a married couple with no kids, with $80,000 in current state and local taxes, making $300,000 a year, living in a $1.5 million home, then, he said, you might pay $1,000 more in taxes.
Collins said most of his constituents will be quite happy when they get their first paycheck after Jan. 15 if the House bill passes the Senate -- and the Senate has its own ideas about how to change the tax code -- and they see their withholding has gone down.
"(The governor) is lying and he’s deliberately lying," Collins said. "He lied again and he exposed himself by talking about this and then attributing a quote to me. That’s beyond outrageous. I think he’s lost it.
"Now, from this day forward I can remind people, he is a pathological liar," Collins added.
Congressman Chris Collins (NY-27) applauded legislation to update our nation’s tax code that was released today by House Ways and Means Chairman Kevin Brady. Collins cited the fact that this legislation will provide tax relief to hardworking families across America, create jobs, and grow our nation’s economy.
“Passing comprehensive tax reform will be one of the most important accomplishments we will see under President Trump,” Collins said. “Making America more competitive on the world stage will truly 'Make America Great Again' and allow more Americans to achieve the American Dream. Our nation is struggling and we need to fix the broken, outdated tax system that has burdened hard-working individuals and has crushed our economy.”
The plan outlined by House Republicans will strengthen the American middle class by doubling the standard deduction, and for those who want to itemize deductions to continue to write off property taxes, mortgage interest, and charitable contributions. The legislation also reduces rates for middle-class Americans, eliminates the Alternative Minimum Tax (AMT) and enhances the Child Tax Credit.
“Tax reform is essential in order to grow our economy for our children and grandchildren’s generations,” Collins said. “I am confident that we will get this bill to President Trump’s desk and will see explosive economic growth.”
The framework puts America’s corporate tax rate below the average of other industrialized countries and promotes greater investment in American manufacturing. Collins supports reducing the minimum tax rate for small businesses and corporations in order to increase American competitiveness, create jobs and grow the nation’s economy.
For more information on H.R. 1, Tax Cuts and Jobs Act, click here.
Congressman Chris Collins (NY-27) released the following statement applauding Ways and Means Committee Chairman Kevin Brady’s decision to include a state and local property tax deduction in the House Republican tax reform bill.
"I am pleased that Chairman Brady has agreed to keep the SALT property tax deduction in the new tax reform legislation. It goes to show you that leadership does listen to the concerns we as members point out. Now, New York taxpayers are poised for a big victory when federal tax reform provides them with more money in their pockets and better economic opportunity. It’s time for Andrew Cuomo to follow our lead and deliver comprehensive tax reform when it comes to the state income and property taxes New Yorkers pay."
The Ways and Means Committee is expected to release its tax reform legislation on Wednesday. For more information on the unified framework for fixing our broken tax code, click here.
The County Legislature won't take a position on a GOP proposal to eliminate deductions on state and local income taxes after the Ways and Means Committee failed Wednesday to move forward a resolution to oppose the change in the federal tax code.
A draft resolution, written by the NYS Association of Counties and the National Association of Counties, was sent to the County Legislature and after Legislator Marianne Clattenburg made a motion for the committee to send the resolution to the full Legislature, Ray Cianfrini, a member of the committee and chairman of the Legislature, said he opposed the resolution.
"I think it only benefits the very rich and not most of the people," Cianfrini said.
Cianfrini said when practiced law, a portion of his practice involved tax law and he saw very few clients taking the kind of itemized deductions that would allow them to deduct their payments of state and local income taxes.
Congressional Republicans are also talking about increasing the size of the standard deduction and Cianfrini calculates that the first $34,000 earned by a household would not be taxed. That would make it even more impractical for most people to itemize their deductions.
"I don’t pay $20,000 in state income tax, so what benefit is this to me?" Cianfrini said.
Clattenburg said she supported the resolution because New York is one of the highest taxed states in the Union and New York sends more money to Washington than it gets back.
Legislator Andrew Young said he supported the motion only because he thought the full Legislature should get a chance to vote on it but that he would probably ultimately vote against it.
Committee Chairman Bob Bausch opposed the resolution because he said he didn't think the Legislature should be lobbying Congress on tax policy.
With a 2-2 vote, the motion to move the resolution forward failed.
“New York’s taxes and spending have reached monumental proportions. It is a shameful reflection of the policies pushed by New York City elites and state leaders that our families must work over four months a year to pay off their collective tax burden.
We have some of the highest property taxes in the country right here in our state, and it is abundantly clear that many businesses and families would rather uproot and relocate to more tax-friendly states than remain in New York.
We need to cut business and income taxes to incentivize families to remain in our state and reinvest in our citizens rather than spending money on programs for illegal immigrants and Hollywood movie producers.”
"Year-end Tax Planning Tips -- Smart Investments in Your Business to Help You Grow!" is the topic of a workshop sponsored by the Genesee County Chamber of Commerce on Wedensday, Oct. 12.
Networking begins at 7:30 a.m. and the seminar runs from 8 to 9 a.m. at the chamber office, 210 E. Main St. in Downtown Batavia.
It is to be presented by Denise Neamon, CPA/Partner, The Bonadio Group. A questions-and-answer session will follow.
Small business owners need to plan and pay special attention to planning for each year's taxes. Putting a plan in place it invest wisely in your company is critical. Reducing your taxable income can help you keep more monet to grow your business.
The seminar is free to chamber members; cost is $10 for non-members.
Contact Kelly B. at 343-7440, ext. 26.
Press release from County Manager Jay Gsell:
As New York State prepares to renew or make permanent the cap on local government property tax levies, a new report by the Pew Charitable Trusts highlights why local property taxes in New York State are so high. The problem has little to do with local governments and won’t be solved by a tax cap.
The Pew Trust data show that an average state receives about 2 percent of its revenue as transfers from local governments. In New York State, the number isn’t 2 percent. It is 15. Over one-seventh of the State’s revenue comes from local governments.
As the Pew report notes “New York got more of its revenue from local funds (15 percent) than any other state. Among those states that require local governments to pay for part of the health care costs incurred by Medicaid patients within their jurisdictions, New York’s local governments make a particularly large contribution.”
Simply put, New York State has shifted over one-seventh of its costs to local governments, which must then raise property taxes to pay those bills. Rarely has the disparity between New York and other states been so clearly presented, and the mystery of high local property taxes so effectively explained.
Clearly, the problem of high property taxes in New York State will not be solved by a permanent tax cap, or rebate checks, or by Albany conjuring up false images of wasteful local governments.
A real solution depends on the State acknowledging and addressing what is shown with such elegant simplicity by the Pew Charitable Trust's analysis – that the State has shifted 15 percent of its own costs to local governments. When that local property tax subsidy of the State budget ends, so will the era of high local property taxes in New York State. Albany, the next move is up to you!
Tax season is here. Richmond Memorial Library, 19 Ross St., Batavia has partnered with volunteer auditors from the New York State Department of Tax and Finance to offer income-eligible citizens (earning up to $60,000) assistance with filing their taxes online. Auditors are available most Saturday mornings from 9:30-1:30, Mondays from 2:00-7:00 pm, and Wednesday from 12:00-5:00 pm from now through April 13. To schedule an appointment, call the reference desk at (585) 343-9550 x 3.
The drop in gas prices may be great for your pocketbook, but it's costing Genesee County, and other local governments, a bit of money, though the precise amount of lost revenue is dependent on how the local economy does in other sectors.
County Treasurer Scott German's back-of-the-envelope calculation is at least $500,000 in lost sales tax revenue for the county and another $500,000 distributed among the county's other municipalities, based on current gas prices.
Officials, however, expect much of that drop in revenue to be offset by increased local sales and a seemingly growing local economy.
Since the county already budgeted for a $300,000 drop in sales tax, said County Manager Jay Gsell, any decline in gas sales tax will be a soft blow.
"The level of consumer spending and consumer confidence being up in last quarter of 2014 and new retail opportunities in late 2014 and 2015 could also help stave off fuel sales decline estimated by the county treasurer," Gsell said. "Sales tax projections are not an exact science and statewide figures during 2014 have been all over the map and inconsistent."
German said there are so many variables in sales tax, it makes it hard to predict revenue, even though the sales tax on gas is a nice chunk of change for local governments.
"Who would have thunk back in August that we would be paying less than $3 a gallon for gas around the holidays?" German said.
There is a delay in transfer of sales tax revenue from the state to the county, so determining the exact amount of the revenue decline isn't possible just yet, German said.
Most of the local fuel sales is from travelers on the Thruway and fuel prices could also increase the number of travelers on the Thruway, thereby increasing gross sales tax revenue.
The county -- with its fleet of snow trucks, maintenance trucks and patrol cars -- will realize some cost savings on its own fuel expenditures, but it's too soon to get those numbers, officials said.
Batavia City Manager Jason Molino said that while sales tax accounts for 18 percent of all sales tax revenue, he's planning on either a slight increase or flat sales tax revenue.
"That's got to have an impact when one-fifth of your sales tax comes from fuel sales," Molino said, but there's also an upside to lower fuel prices that will help boost revenue.
"I was out on the west side of town before Christmas and the parking lots were packed," Molino said.
An informal survey of a handful of The Batavian's advertisers found a universal sentiment that these stores had a strong holiday sales season.
German said the impact of holiday sales won't hit the books until April. Before then, it's not possible to put a number on how well the county did in November and December, at least according to sales tax figures.
Molino said the county's low employment rate combined with one of the strongest growth rates in real wages in the state is helping to offset any drop in gas sales tax revenue.
"How long prices are going to stay ... at this low level is the bigger question," Molino said. "There's no real answer to that question. It would be nice if there was some price stability."
Enough robbing Peter to pay Paul. Maybe its time to send a little cash back Peter's way, county legislators suggested during a budget session Wednesday afternoon.
County Manager Jay Gsell's early-stage draft budget calls for a reduction of the county's property tax rate from $10.04 to $9.85 per thousand.
After years of diverting sales tax revenue to balance the general fund budget, maybe the county should replenish the "1-percent fund," Legislator Bob Bausch suggested, followed by words of agreement from legislators Ed DeJaneiro and Frank Ferrando.
The 1-percent fund was created following an increase in the county's share of the sales tax in 1996 to help fund the county court complex.
From that point forward, that 1 percent cut of sales tax was supposed to go to a capital reserve fund -- money in the bank for roads, bridges and other infrastructure.
But in recent years, as a stagnant economy caused tax revenue to sag and out-of-control state mandates put unrelenting pressure on the county's ability to fund basic programs, a portion of that 1-percent fund has been diverted into the general fund.
Meanwhile, roads and bridges continue to age and deteriorate.
"If we have some more money this year, I would kind of like to see that replenished and do some more capital projects, because as the residents of the county know, between the highways, bridges and roof and general capital budget items, we have fallen somewhat behind," Bausch said. "...if at all possible, I would like to see us address some of those issues if we have some extra revenue."
Through the typical budget process, department managers from throughout the county submitted their funding requests for 2015.
Requested spending topped $27 million, which would have required a tax rate of $9.96 per thousand of assessed property value.
Gsell made cuts and reduced the recommended levy to $26.8 million, requiring a tax rate of $9.85.
The reduction in proposed spending is possible, Gsell said, because of sound fiscal management over the past 20 years, negligible staff growth the past couple of years, and the state capping how much it expects the county to contribute each year to mandated programs.
Mandates still eat up 82 percent of the county's revenue, but at least the figure isn't growing the way it has in years past.
"The state has capped Medicaid at $9.9 million, and that's great, but in every other state but one, counties don't pay anything for Medicaid," Gsell said. "If I could take $9.9 million and tell the State of New York, 'you pay for Medicaid, you control the program, you write the rules, you tell us (what) we can't do as far as reforming a local version that doesn't exist,' then I could say our tax rate goes down by 38 percent. It's not going to happen, at least (not) the way the State of New York is thinking at this point."
With less spending pressure on the county budget, though, Bausch and other legislators are saying, let's review capital funds a little further.
"We can't keep telling people your bridges are going to fall down, but we're going to cut your taxes," Bausch said.
DeJaneiro said he knows it's not an issue in his district (a portion of the City of Batavia), but he knows there's been an issue elsewhere with school buses and fire trucks being unable to pass over bridges because of structural deficiencies. Andrew Young and Bausch both said those have been issues in their parts of the county.
"Bridges are reality and people not getting an ambulance on time or a fire truck on time because of a bridge is something we should be concerned about," DeJaneiro said.
Ferrando agreed with the general sentiment.
"We should replenish the fund when we have a year where we have an opportunity," Ferrando said. "We should consider it."
Gsell was asked to prepare a report on the fund and provide more information to the Legislature.
Also discussed during the budget session was female prisoner transport. It's an expense that is continuing to rise and also takes a deputy or two off patrol at a time.
Gsell said options including having corrections officers transport female inmates, or hiring a private contractor who can provide licensed and bonded security officers for transport.
A few years ago, the Sheriff's Office would have seven or eight female inmates housed at the jails in Orleans, Wyoming or Monroe counties. Now there are 19 or 20 women in the county's inmate population at any one time, all needing transport occasionally to and from the county for court appearances or meetings with attorneys. But adding to the cost burden is the fact that some inmates are now housed as far away as Allegheny County and Wayne County.
Because of behavioral issues, certain inmates are no longer accepted by closer, neighboring counties.
Nothing was settled Wednesday on how to resolve the issue.