Here are two bad data points for local governments in New York as the pandemic continues to surge and the economy continues to suffer: Sales tax revenue continued its slide and help from Washington won't be coming in a $900 billion COVID-19 stimulus measure about to be agreed upon in Congress.
Local governments are facing their worst financial headwinds since the 2008 recession as revenue continues to dry up amid the pandemic, making budgeting for next year a significant challenge given the uncertainty surrounding support from the federal government.
Sales tax declined statewide by 71.% in November compared to the same period in 2019, Comptroller Tom DiNapoli's office announced. That's a steeper decline from the October drop of 5.2%, but not nearly as sharp as the drop off in the spring during the first surge of the pandemic in New York.
“Sales tax collections are a crucial revenue source for our counties and other municipalities,” DiNapoli said. “November’s decline reinforces the need for significant aid from the federal government as COVID-19 infection rates increase and more restrictions curb economic activity. Federal aid will keep first responders on the job and help implement the delivery of the vaccine.”
The worst of the sales tax drop was in the Southern Tier, where it fell 10.9%. All but five counties saw revenue fall last month from the sales tax.
The lack of cash could affect how counties budget, meaning property taxes could face increases. And at the state level, Gov. Andrew Cuomo has warned of cuts to schools, health care and further reductions to local government support with aid from Congress.
Meanwhile, county officials knocked Congress for the lack of local government support in the stimulus measure. Aid for states and local governments will likely now have to wait until early next year when President-elect Joe Biden is expected to unveil his own stimulus plan. Biden has pledged help for state and local governments who have lost money during the crisis.
"Congress’s failure to reach a compromise on pandemic relief aid to states and local governments not only fails New Yorkers now, but it fails generations to come," said Dutchess County Executive Marc Molinaro and New York State Association of Counties President Jack Marren.
"They have failed our neighbors who need help, and taxpayers who are trying to make ends meet. They have failed the local health workers who have labored around the clock for nearly 9 months to protect their communities from this terrible pandemic, and they have failed the thousands of county workers who have lost their jobs or may lose their jobs when counties make devastating program and staff cuts."
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December 17, 2020 at 02:21AM
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Sales Tax Continues to Slide, Local Governments Press - Spectrum News NY1
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