GLENVILLE — Unless it can get more money through the Schenectady County sales tax disbursement formula, rising benefit costs will render the town’s budget “unsustainable,” said Town Supervisor Chris Koetzle.
Koetzle, a Republican in a Republican-controlled town, is hoping to persuade the Democrat-controlled County Legislature to change the sales tax distribution formula to share more money with municipal governments. The county now keeps 75 percent of the sales tax money the county collects, with much of the rest going to the city of Schenectady.
During the first in a series of presentations about the tentative 2018 town budget, Koetzle said the town faces a 9 percent increase in health care costs next year, while anticipating very little sales tax revenue growth and trying to remain under the state’s 2 percent property tax cap.
For 2018, he believes the property tax increase will be about 1.5 percent, but he told a large audience at Town Hall the trend can’t continue without a remedy. For at least the past decade, the town pulled funds from an accumulated fund balance to make its budgets work. Next year, it will draw $400,000 from that fund, the lowest amount since Koetzle became supervisor in 2011.
“Benefits are going to break every town — not just our town, every town,” Koetzle said. “I’m not saying that’s eminent, but when you model that out, you can’t continue to absorb 9,10, or 11 percent increases in the health insurance line while your sales tax revenue is flat without having a significant levy increase.”
The current town budget calls for $17.2 million in total spending, with $1.9 million of that spent on employee health care coverage. The tax rate is $3.66 per $1,000 of assessed property value.
Schenectady County currently shares only 25 percent of its sales tax revenue with local governments, with the city of Schenectady and Schenectady County Metroplex Development Authority receiving the bulk of the local distributions. While Glenville receives $2.7 million of the sales tax revenue each year, Koetzle said it received only $9,000 from each $1 million of new sales tax revenue generated in the county in recent years.
“It has essentially been a flat source of revenue,” Koetzle said.
In response, County Legislature Chairman Tony Jasenski, D-Rotterdam, said the county faces its own financial challenges and doesn’t have to share sales tax revenue at all.
“That’s not something we have to do. We do that because the Legislature is sympathetic to the needs of the municipalities,” he said.
If the town were in Saratoga County, which distributes half of its sales tax revenue to the towns, Koetzle said Glenville could basically eliminate its property tax, as comparably-sized Saratoga County towns like Wilton and Clifton Park have done.
Jasenski responded that the county provides a number of services to the towns, including libraries, and has provided central emergency dispatching since 2014, which he said saves Glenville $150,000 per year in personnel costs over having its own dispatching, even though the town is also billed for the service.
“Saratoga County is a different county; statistics don’t lie. Schenectady County has a different set of expenses and challenges than Saratoga County,” Jasenski said.
According to the state Comptroller’s Office, there are 12 counties that share no sales tax with their municipal governments and 14 that share 25 percent or less. Seven counties share 45 percent or more. But between 2000 and 2015, the comptroller said a dozen counties negotiated new agreements, with municipalities often getting more than they previously received.
The current sales tax distribution formula has been in place since 1999, and it is due to last through 2020. But Koetzle said there is nothing that prevents the county from negotiating a new agreement sooner — though he acknowledged getting the county to agree will be difficult.
Once the series of budget forums is over, Koetzle said he plans to ask county legislators to discuss the issue. He said he will invite the District 3 legislators, who represent Glenville, to a meeting on Sept. 27.
Jasenski said Koetzle hasn’t approached him directly.
“It is easy as an elected official to point the finger elsewhere,” Jasenski said.
“He wants to make it personal instead of trying to find a solution,” Koetzle responded on Friday.
Wednesday’s budget forum was the first in a series leading up to the Sept. 30 release of the tentative 2018 spending plan.
Future board presentations will take place at 7 p.m. on Sept. 14 in the Glenville Senior Center on Worden Road, and at 2 p.m. on Sept. 28, also in the Senior Center.
Reach Gazette reporter Stephen Williams at 518-395-3086, [email protected] or @gazettesteve on Twitter.
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Categories: News, Schenectady County