CANTON — The possibility that St. Lawrence County Legislature may revise the way it distributes sales tax revenue to municipalities is drawing concern from some town and village officials who are afraid they’ll face a significant loss.
The county is considering changing the formula because it’s renegotiating a 10-year agreement with the city of Ogdensburg regarding what share of sales tax money collected by the county goes to the city. The existing agreement expires Nov. 30, 2020.
“I’d like to go on record saying I’m very concerned,” Canton Town Supervisor Mary Ann Ashley said during the town board’s Sept. 11 meeting. “We get an average of $800,000. We’re working on the 2020 budget and any changes to that would be very bad. Other supervisors are concerned. I know the mayor’s association is concerned. I’m just going on record to say that any change will be devastating.”
Ms. Ashley was directing her comments to legislator Kevin D. Acres, R-Madrid, who discussed the issue with the town board that evening.
A five-member committee, headed by Legislature Vice Chairman David J. Forsythe, R-Lisbon, has met with Ogdensburg city officials to try and hash out a new sales tax deal. Besides Mr. Forsythe and Mr. Acres, other legislators on the committee are Chairman Joseph R. Lightfoot, R-Ogdensburg, James E. Reagen, R-Ogdensburg, and Dan Fay, D-Canton.
During the past few weeks, county legislators have been advising town officials within their districts that changes may be in store and numerous.
Finance Chairman Kevin D. Acres told the Canton Town Board that Ogdensburg would like the sales tax formula to remain the same.
“Their comment to us, which you probably know, was leave it alone,” Mr. Acres told the town board. “There wasn’t a lot of back and forth with the city, just discussion about the financial situation in the city and what the county is facing for the future.”
Another meeting between county and city officials is scheduled for Sept. 23.
Mr. Acres said that meeting is not open to the public because it involves negotiations.
Originally, he said when counties were allowed in 1965 to start charging sales tax on top of state sales tax, the purpose was to fund the county’s share of Medicaid expenses.
One of the scenarios now being considered is to pay the county’s Medicaid expenses and then distribute what remains among the municipalities,
Last year, the county collected about $58 million in sales tax revenue.
“One of the scenarios is that whatever comes in we pay the Medicaid bill first, which is close to $24 million and the remainder about, $34 million, would be split up amongst the municipalities. So you would take a great reduction,” Mr. Acres said. “There’s not consensus on anything. There’s not been a vote on anything.”
He said several counties in the state don’t share any of their sales tax revenues with municipalities.
St. Lawrence County shares roughly 43 percent with towns, villages and Ogdensburg, which compares to the 30 percent statewide average.
Mr. Acres also said that data shows that some of the towns and villages have built up fund balances that are much larger than recommended by the state Comptroller’s Office.
Town Councilman James T. Smith said revisions to the sales tax formula are essentially shifting expenses from county taxes to town taxes.