Sales tax hike ditched in new Saratoga County budget plan

PHOTOGRAPHER: Stephen Williams

With plans to raise the county sales tax suddenly dead, county supervisors on Friday made a series of budget cuts and voted to raise property taxes 3.5 percent, the first tax increase in nearly a decade.

The Board of Supervisors unanimously accepted a plan crafted by Supervisor John E. Lawler, R-Waterford, that makes $7 million in cuts and included the tax increase.

“We are not going to get any help from the state. We are going to have to solve our own problems, even if they are problems forced on us by the state,” Lawler said.

He was referring to costs like Medicaid payments and community college tuition charges that are mandated by the state, but not reimbursed.

The average county property tax rate would rise from $2.15 to $2.23 per $1,000, or a $16 increase for a house assessed at $200,000.

It will be the first increase in the average county property tax rate since 2002, officials said. “We should be heralded as stewards of the money,” Lawler said.

There are proposed cuts to the Saratoga Performing Arts Center and other outside organizations the county helps fund, cuts to the county paving and highway equipment purchase program, and there will be an effort to get more employees and retirees to contribute to their health insurance costs.

“This avoids the need for immediate layoffs, and I think all my colleagues realize hard choices have to be made,” Lawler said. “It solves our budget problem for 2012. I think this shares the pain across the board as reasonably as we can.”

During 2012, supervisors said they will look at other budget options, including selling both the money-losing Maplewood Manor county nursing home and the never-used county landfill in Northumberland.

The revised tentative budget, which now totals $308.3 million, will be the subject of a public hearing at 5:30 p.m. Thursday, Dec. 1, at the county board room in Ballston Spa.

In its most radical change, the revised budget includes no attempt to raise the county sales tax to generate new revenue.

The tentative budget proposed by County Administrator Spencer Hellwig III on Nov. 9 included an increase in the combined state-county sales tax from 7 percent to 8 percent, but public criticism of that idea has been growing.

On Thursday, the county’s two state senators said they wouldn’t introduce the “home rule” legislation necessary to increase the tax in the state Legislature, even if supervisors asked them to.

“The sales tax increase is effectively removed from the table,” Lawler said.

Several supervisors said they were “disappointed” by the state legislators, and felt the legislators shouldn’t be second-guessing the supervisors’ budgeting decisions.

“I think they got out in front of us without communicating with us,” said Supervisor Bill Peck, R-Northumberland, drawing applause from colleagues.

State Sen. Roy McDonald — who on Thursday said the supervisors should look at budget cuts before raising the sales tax, and said he would not advance the tax hike proposal — could not be reached for comment for this story.

“I think this is a good budget. I’m comfortable with it now,” said Law and Finance Committee Chairman Frank Thompson, R-Milton, who had been an opponent of the sales tax increase.

The budget cuts include:

• $1 million in the county road paving program, dropping it to $3.5 million. The paving program had already been scaled back by about one-third from normal levels, even before the new cut. Also, $598,000 was cut from highway equipment purchases.

• Nearly $2.2 million set aside against the possibility of the county having to pay an assessment to fund the Hudson River-Black River Regulating District. That matter is in court, and a final decision may be several years away, Lawler said.

• $1.2 million from outside agency funding. The cuts include eliminating contributions to the Hudson-Mohawk Urban Cultural Park, SPAC, the Saratoga County Museum, the Saratoga County Fair and the Capital District Regional Planning Commission. The Saratoga Economic Development Corp. would be asked to absorb a $97,000 cut, reducing its total funding to $200,000.

“We looked for agencies we could reduce or eliminate without affecting the operations of Saratoga County,” Lawler explained.

• A potential $2.5 million loan to the Saratoga County Water Authority to cover 2012 operating deficits was reduced to $1.5 million.

• Members of the Civil Service Employees Association and other employees hired before 2001 will be asked to pay 15 percent toward their health insurance — a matter than will require negotiation with the union. The county will also stop reimbursing retirees for the Medicare co-pays, as it does now.

After those cuts, there would still be a 3.5 percent property tax increase that would raise $1.7 million. Because pension contributions are not counted toward the state’s new tax increase cap, the county’s increase is within the 2 percent tax cap.

Lawler said a property tax increase at this point can be justified. “People would be hard-pressed to find another county where taxes are lower than they were 10 years ago,” he said.

The only planned layoffs are two part-time employees at Maplewood Manor — a dietician and a pastoral care worker — whose positions the facility’s administrator had recommended eliminating.

“Cuts are never easy, but they’re spread throughout the budget,” said Supervisor Art Johnson, R-Wilton.

Supervisors said the cuts and tax increase balance the budget for next year, giving them time to look at the future of Maplewood Manor and the landfill.

Board Chairman Tom Wood, R-Saratoga, said a three-member committee has been formed to look at options for the infirmary. It loses millions of dollars every year because of low Medicaid reimbursement rates for nursing home care; it is expected to lose $9.4 million next year, a deficit the county has to cover from its general fund.

The Public Works Committee will also look at a possible sale of the county landfill. The facility was built in 1998 after a lengthy fight with local officials, but has never opened. Potentially, it could be sold to a company that operates landfills or needs waste disposal space.

“The landfill is going to be tracked for coming up with a viable solution,” said Public Works Committee Chairman Alan R. Grattidge, R-Charlton.

Selling either facility is likely to spark controversy.

No further changes to the tentative budget are expected until after the Dec. 1 public hearing. Plans call for adoption of the budget at a Dec. 14 meeting.