Growth seen in sales tax receipts

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Schenectady County saw the largest growth in sales tax receipts in the Capital Region in 2008 while Fulton County had the largest decrease, according to state figures.

Schenectady County’s $85.9 million is the largest amount it has collected to date, according to records. “Our percentage increase is well above the state average, and the seventh highest in the state,” said Ray Gillen, commissioner of economic development and planning for Schenectady County. “There is a ripple effect to this,” he said.

The ripple effect is that the city of Schenectady and the towns and villages will split $544,000 in sales tax revenues, in addition to their guaranteed awards of $11 million and $7.8 million, respectively. The sales tax in the county is 8 percent with the state getting 4 percent of this total.

This is the first time they are receiving extra sale tax revenue under a sharing formula. However, it is the only year they will share the extra receipts under the formula, as it was eliminated under a new agreement.

Schenectady County’s total represents an increase of 5.86 percent from 2007’s total. Fulton County’s total of $17.6 million is down 1.69 percent from the prior year.

Other counties

Saratoga County finished the year with $96.8 million in sales tax receipts, up 2.38 percent; Albany County’s year-end total was $237 million, up 2.97 percent; and Montgomery County’s was $25.5, up 4.97 percent.

Schoharie County had the second greatest decrease, 1.52 percent, in its total sales tax receipts for 2008, $13.4 million. It also had the worst fourth-quarter drop in sales tax receipts, 14.45 percent, of counties in the region.

Schoharie County Treasurer William Cherry said the decline will not have a major impact as long the county’s annual receipts stay around $13.7 million.

“If it remains in that range, the mid-$13 millions, we’ll be fine and we’ll tighten our belt and hold the line on spending,” Cherry said. He called the fourth-quarter results the worst he has ever seen.

Fulton County interim Treasurer Michelle Ippoliti said Fulton County’s 2008 sales tax total “obviously reflects the economic downturn.”

Sales tax in Fulton County is apportioned differently from most other counties in the Capital Region. The cities of Gloversville and Johnstown both receive only the sales tax generated inside their borders while the rest of the money is pooled and divided between the county government and the towns and villages.

The city of Johnstown actually saw a $34,361 increase in sales tax receipts year-over-year for the fourth quarter, while Gloversville was socked with a $77,284 decrease.

Johnstown city Treasurer Mike Gifford said the city’s 2008 total sales tax income was $3.1 million, flat from 2007. He said he suspects an increased number of retail stores on Route 30A may have helped the city’s fourth-quarter numbers.

“Rather than pump gas in the car and drive to Albany maybe people were buying more locally, but that’s a guess,” Gifford said.

Gillen said Schenectady County’s sale tax boost is due to the benefits of economic development efforts begun 10 years ago and continued by the Metroplex Development Authority, of which he is chair. Metroplex has helped revitalize the city’s downtown and brought new jobs and development to the towns.

In Schenectady, the county shares tax receipts with the towns and villages, giving them a guarantee of $7.8 million. It also gives the city a guaranteed $11 million annually. It keeps the remainder.

The towns and villages also receive a portion of the sales tax used to fund the Metroplex Development Authority. Under this agreement, the towns and villages will receive a record total of $3.3 million for 2008. They have received a total of $29 million since Metroplex was started in 1999. Metroplex receives one-half of 1 percent of the sales tax. It retains 70 percent of that and distributes 30 percent to the towns and villages.

Under a new four-year agreement signed last year, the county guaranteed the city will continue to receive $11 million and the towns and villages $7.8 million annually. It also agreed to give the city an extra $25,000 per year, on top of the previous year’s $25,000, for a total of $250,000 during the term of the agreement.

In return, the city agreed to forgo sharing any growth in sales taxes receipts after the county collects at least $83.5 million in any one year.

Gazette reporters Jason Subik, Stephen Williams and Edward Munger Jr. contributed to this story.