QUEENSBURY - The proposed Warren County sales tax increase from 7 to 8 percent will stave off pending double-digit county property tax hikes and would mean lower net taxes for most residents while shifting much of the burden to tourists and transients, eight county supervisors said Monday.
The supervisors held an unprecedented press conference to detail how $7.6 million has been cut from the budget in recent months, which includes eliminating more than 50 county jobs - but the county still faces a deficit of $3.9 million or so, and has nearly depleted financial reserves. These reserve funds, normally used to stabilize taxes or meet short-term obligations, were spent prior to last year on keeping taxes artificially low while county expenses increased, county Board of Supervisors Fred Monroe said.
The depleted reserves, among the lowest for the state's counties, put Warren County in financial jeopardy, necessitating borrowing - and incurring this debt at a higher rate due to a newly-reduced bond rating, Monroe said.
To rebuild the reserves, avoid double-digit county property tax increases for many county residents, a boost in sales tax is the best available solution, Monroe said.
Increasing the sales tax by 1 percent will provide about $14 million in extra revenue, with about $6 million of this sum shouldered by tourists, second-home owners or transients - resulting in a lower total tax burden for county residents, he said.
"We believe this is the best solution for residents and reducing overall taxes," he said.
A sales tax increase would cut the pending property tax increase in Queensbury from 23.2 percent to 12 percent; reduce the similar pending increase in Johnsburg from 26.7 percent to 15.5 percent, the expected 15 percent increase in Bolton to 2.6 percent, and cut the pending increase of 23 percent in Lake George outside the village from 23.3 percent to 10.5 percent.
In Stony Creek, the pending property tax boost would be cut from 10.9 percent to 1 percent, in Thurman reducing an increase from 12.6 percent up to 2.6 percent, in Warrensburg from 14.6 percent up to 4.4 percent, and in Horicon from 7.7 percent up to a decrease of 1.9 percent, and in Chester, from 7.7 percent up to a decrease of 1.8 percent.
In 2011, if mandated expenses stay the same, property taxes likely would be lowered overall, the supervisors said. Johnsburg Supervisor Sterling Goodspeed said the sales tax hike was needed because property taxes have gone so high in Johnsburg and other rural towns that people are being forced out of their homes, and many more are facing foreclosure. A sales tax hike, he said, would shift much of the taxes to the vacation-home owners and tourists would could well afford a one percent increase in discretionary spending, away from low- and moderate-income property owners who would otherwise be spending hundreds of more dollars on county property taxes.
"We have multi-generational families and senior citizens who are struggling to survive," he said. "Property taxes in my community are not just a political issue, they're now a matter of absolute survival."
County Budget officer Kevin Geraghty said the additional revenue would not prompt supervisors to spend more and expand government.
He said money would be dedicated to reducing property tax burdens and restoring financial reserves, while county leaders continue to seek ways of cutting costs and boosting productivity.
"This is not going to be a free pass for county department heads or supervisors to ignore spending in the future," he said.
Lake Luzerne Supervisor said that providing services for the elderly, for public safety and health were "extremely important" and should not be put in jeopardy.
"We can't take any more of these services away without reducing the quality of life here," he said.
He said that proposed cuts to infrastructure repair would have substantial consequences.
"Tourists will not come here if we don't provide good roads and bridges as well as attractions to draw them here," he said.
County Treasurer Frank O'Keefe noted that all residents pay property taxes, although renters pay the taxes through their rent - and they, too would be shouldering tax increases, if not for the solution of a sales tax increase.
The press conference was convened, Queensbury Supervisor William VanNess said, because the area daily newspaper hadn't adequately publicized the pending tax increases in various towns, and how a sales tax hike could offer relief to taxpayers.
"Today we're getting the fact out - the true story," he said.
Goodspeed criticized the daily newspaper's repeated editorials against a sales tax increase, saying they were based on a lack of information. But he praised the news coverage provided by the Adirondack Journal and the North Creek News-Enterprise, calling it objective.
"The Post Star editorials have no basis in reality," he said. "Anyone who sat in the meetings and heard all the information could not have written those editorials."
Supervisors voted Nov. 30 to ask state legislators to pass enabling legislation to set the stage for a temporary 1 percent tax increase. A final vote to enact the tax would occur in several months, and the tax hike would begin next September, or July at the earliest.
Supervisor Ralph Bentley said he had heard from about 30 people, many of them entrepreneurs, who said that a sales tax hike was definitely preferable to much higher property taxes.
"This is tax relief for full-time residents," he said.