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THE PRICE OF DISCORD

Mike McCagg

ccSCOOP News

07-01-09 – 2:15 p.m. - Columbia County and its municipalities are likely to lose more than $7.5 million in sales tax collections if the State Senate cannot resolve its leadership squabble.

Requests to extend the county’s authority to collect an additional one percent of sales tax—part of the 8 percent sales tax levied in the county—and the authority to collect a property transfer tax are among the countless “home rule” laws awaiting Senate action—laws which could cost taxpayers millions of dollars if not enacted.

Columbia County expected the legislation, which has already cleared the State Assembly, to be enacted prior to the July 1 deadline, as has happened several times in the past decade, but, as a result of the three-week-old leadership squabble in the Senate, it has not been.

 

County officials, including Board of Supervisors Chairman Art Baer (R-Hillsdale), were at the State Capitol on Tuesday as the deadline loomed for the legislation to be authorized, but instead of seeing positive results, they ended up witnessing the chaos that erupted as the Senate remained divided and a Democratic contingent attempted to enact legislation, claiming a quota after a Republican senator passed through the chambers in his way to get a soda. The legislation, which some senators claim was passed as a result of the Republican senator’s peripatetic presence in the chamber, will not be signed into law, Governor David Paterson said.

 

Columbia County Treasurer Ken Wilber said on Wednesday that for the time being the county still has the authority to collect the sales and property transfer taxes, with the legislation set to “sunset” later this year. But, he told ccSCOOP, the loss of the county’s one percent sales tax could spread misery to the county and its municipalities.

The one percent sales tax, he said, generates $7.5 million in added revenue—a quarter of the $30 million the county collects from sales tax each year. A third of the collection is then distributed to county’s towns and the City of Hudson, he said, with the remainder applied to offset the county’s $140 million budget. “The misery is going to be spread around,” he said.

In addition, Wilber said, the county collects $250,000 from the property transfer tax, and while mortgage tax revenues are shared with the municipalities, the property transfer tax that accompanies the mortgage tax remains solely a county revenue.

The Board of Supervisors passed the resolution requesting the sales tax extension in January, and the State Assembly took action on the request within the last month or so. As recently as last week, county officials were saying that the sales tax extension had cleared the Senate and would not be held up by the Senate leadership debate, but, Wilber said, that was the result of “some confusion.” County leadership has since learned that Columbia County, as well as numerous other counties in the state, may be financially harmed by the ongoing power struggle in the State Senate.

     
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