Time for a reality check
St. Lawrence County legislators have now been personally introduced to the hard choices we mentioned here a couple weeks ago. They were presented a budget that offers no increase in the tax rate, but is predicated on some choices, and some predictions, that ultimately may be difficult if not impossible to support.
County manager Karen St. Hilaire's budget includes cuts in staffing and overtime, although it doesn't propose to lay anyone off. Still, it would eliminate 24 positions through attrition, a figure that's often hard to pin down because it relies upon the decisions of employees, not employers, to attain. And the budget contains a wage freeze, even though most county employees are covered under union contracts that could prevent that from being enacted. With at least $12 million in unexpended funds, and with the county committing only $1.8 from the unexpended balance to reduce the tax levy in this budget, I don't see any unions that won't put the wage freeze proposal on an express train to Nowheresville.
To the extent that total spending has only gone up by about $750,000, the budget appears lean. But you have to put that in perspective, noting the county will still spend more than $222 million in 2010. And Ms. St. Hilaire continues the inane claim that the levy will be reduced by an increase in taxable full-value assessments. Let's put that fiction to bed right now: the levy is the levy. It can be reduced only through the budget; it cannot be reduced through a change in assessments. Tax rates will benefit from higher taxable full value, because the levy will be spread over a larger sum. But this is of little consolation to the property owners whose reassessed value contributes to the increase in full-value assessments; if the tax rate stays the same and their assessment has gone up, they are in most cases going to pay more in taxes next year.
And Ms. St. Hilaire's revenue enhancement schemes rely on the state Legislature, on unproved assumptions and on establishing an entirely new tax that will quietly slip onto the monthly bills of all wireless telephone customers in the county. The proposal to raise the mortgage tax from 0.75 percent to 1.25 percent sounds tiny. But it will raise the cost of recording a $75,000 mortgage from $562.50 to $937.50, a hefty increase in real dollars. And Ms. St. Hilaire's projections of how much that will mean to the budget are based on no changes to the mortgage market, even though there is little on the economic horizon to distinguish her estimates from mere hopes. Even if she's right, both actions will require the approval of the state Legislature – and lawmakers have begun asking counties to justify these requests before they'll submit a home-rule bill. The passage of these measures is no longer guaranteed.
The proposal to take $700,000 from the Mohawk's casino gambling payment and apply it to the general fund simply isn't going to pass state review, because that money is supposed to be spent on economic development and gambling addiction programs. I don't know if St. Lawrence County even HAS a gambling addiction program, but if it does, I suspect it spends about $1.98 on it. The county does have economic development programs in place, but to take $700,000 in gambling money and apply it to that budget category while removing $700,000 in money from other sources and applying it to the general fund is really no different from just sticking the Mohawk's cash into the general fund to begin with. I don't see Empire State Development Corp. going along with that transparent subterfuge.
There are no easy choices in municipal budgets this year. But budgets must be based on measured expectations and on reasonably assured projections. By presenting a budget with cuts that cannot be sustained, or revenues that are purely pie-in-the-sky, local officials virtually assure midyear corrections that can be truly painful, like sudden reductions in staffing, cuts in essential services and deep, unplanned dips into the reserve funds. A government paralyzed by a bad budget can present some suddenly unpalatable surprises.
The St. Lawrence County Legislature should beware of enacting a budget that isn't firmly grounded in reality. The one they're looking at right now doesn't appear to pass the test.
