The St. Lawrence County Board of Legislators Finance Committee put Ogdensburg officials in a bind over how to disperse sales tax.
By a close vote, the Finance Committee once again rejected a resolution to extend the November deadline for the city and county to agree to revenue-sharing plan. The proposal would lengthen this period by a year, giving both entities more time to determine the most equitable formula.
Postponing a deadline just for the sake of postponing it isn’t necessarily good. But members of the Ogdensburg City Council want to move ahead with a plan for the city to collect its own sales tax rather than share revenue with the county and other municipalities.
This could end up benefiting Ogdensburg if the sales tax it generates each year is more than the amount it received from the county. But then again, this measure could be to Ogdensburg’s detriment.
The problem is that it’s not known how much sales tax is generated in the city. The state records sales tax generated by each county, not individual municipalities. A pre-emption plan could result in Ogdensburg receiving a lower amount of sales tax revenue than it does now.
“Despite a rapidly approaching deadline, the city is moving full speed ahead with a plan to collect its own sales tax. The St. Lawrence County Board of Legislators Finance Committee shot down a resolution Monday night that would have again extended the city’s and county’s agreement on how sales tax collected in the county is distributed. The agreement has been in place since 2011 and, if the extension was approved, would have expired on Nov. 30, 2023. With the resolution failing Monday, 8-7, the city has until November of this year to finalize its negotiations with the county about how sales tax is distributed to the city,” according to a story published Tuesday by the Watertown Daily Times. “Under the proposed resolution, beginning on Dec. 1, 2023, the city would have its 6.64% share of sales tax lumped in with that of other municipalities and would be subject to the same formula in place to distribute sales tax based on population and assessed value. The city is seeking to pre-empt, which would allow the city to collect its own sales tax instead of sales tax being collected on the county level, then being distributed to the city. According to [Ogdensburg City Manager Stephen P. Jellie], the city was given a list from the state of about 20,000 businesses across the county, and the city was asked to identify ones that fall within the city limits in order to be able to collect its own sales tax. There is currently no further breakdown of sales tax dollars than the county level, as the state, for the most part, collects taxes by county. The exception would be in counties where cities already pre-empt taxes. Right now, the sales tax goes to the state simply as money from St. Lawrence County.”
We understand that a deadline is meant to keep parties on track to complete their respective work as part of an agreement in a timely manner. If no deadline is set, negotiations could go on indefinitely.
But figuring out how much sales tax revenue Ogdensburg takes in will be a complicated process. St. Lawrence County should want to ensure the plan it has with the city is mutually beneficial. Extending the current formula wouldn’t hurt either side in the short term, so county legislators should approve such a measure the next time they meet as a whole.