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Sun., Nov. 23
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Serving the communities of Jefferson, St. Lawrence and Lewis counties, New York
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Revenue woes

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The Jefferson County Board of Legislators received a stern warning last week from Finance and Rules Committee Chairman Scott A. Gray, R-Watertown.

“We are not faring as well as the balance of the state in collections,” Mr. Gray said. “We were outperforming the state in 2010, ‘11 and‘12, and now we are lagging. A reason for concern — yes, certainly.”

That warning became more chilling late in the week when state Comptroller Thomas P. DiNapoli reported that statewide sales tax collections were up 4.5 percent over the previous fiscal year and $12 million over projections. Sales tax revenues are the key positive in the state’s third quarter tax receipt report.

Business taxes are down $244 million, or 4.5 percent, from last year and $465 million behind planned receipts. Personal income tax receipts are ahead of last year largely because of a deluge of revenue in the first quarter as New Yorkers paid taxes due on transactions taken at year end of 2012 to avoid higher federal income tax rates effective in 2013. Despite the increase, however, the collections are still $225 million below expectations.

Jefferson County is overly dependent upon the sales tax, which is much more volatile than property taxes. As dependence on the sales tax rises, the County Board will struggle to balance the next budget as it tries every means possible to meet state property tax cap requirements. And the question legislators will have to answer will be much more complicated if Gov. Andrew M. Cuomo is successful in gaining state legislative approval of his tax rebate scheme aimed at jurisdictions that keep their tax rate increase less than 2 percent.

The warning signs are embedded in Mr. DiNapoli’s reports. Business taxes, which reflect the prosperity of the employers of New Yorkers, are waning.

This indicates a lack of economic strength in the business community. That does not bode well for the employment ranks and may lead to a reduction in the number of New York jobs.

It is precisely this economic pressure that fuels out-migration from upstate New York. Fewer and fewer successful businesses hire fewer and fewer New Yorkers. Tax receipts fall and the malaise of cost cutting and higher taxes speed the decline, leaving local governments even further stressed.

Mr. Gray is rightly concerned. The County Board should join him and initiate work on investments in the community that will take advantage of the assets we have to bolster the economy of tomorrow.

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