POUGHKEEPSIE – Dutchess County Comptroller Robin Lois Tuesday summarized the New York State Association of Counties’ (NYSAC) update on year-to-date sales tax payments to counties. The summary shows that out of the 57 counties outside of NYC, Dutchess The report shows of the 57 counties in New York outside of NYC, Dutchess has the 12th largest drop in sales tax revenue for the period of January through August 2020, compared to the same period in 2019.
“Dutchess County sales tax revenue dropped 8.5%, or $11 million, from $131 million in 2019 to $120 million for the same period in 2020. These drops are a direct result of the COVID-19 pandemic and the mandatory closing or limitations of many businesses from March until August of 2020,” stated Dutchess County Comptroller Robin Lois. “Most businesses in the state currently can operate at some capacity; I’m hopeful that, short of a second shut down, the worst of the sales tax hits are behind us.”
Sales tax is the largest source of revenue for Dutchess County, accounting for 41.1% of 2020’s total budgeted revenue, or $211 million of $514 million total budget. Over the past decade, Dutchess County’s sales tax revenue as a percentage of total revenue has increased from 32% in 2010 to 40% in 2019. Total actual revenue increased from close to $126 million in 2010 to over $208 million in 2019, an increase of 66%.
Dutchess County budgeted a 1.45% increase compared to the projected sales tax for 2019 at the time. The actual 2019 came in above projections which resulted in sales tax budgeted at only 1.2% growth over 2019 actual, according to county officials.
Comparatively, half of the counties in the state experienced less than a 5.4% drop in sales tax receipts, including 10 counties that had a slight growth of revenue during the period. Westchester County was one of those counties that saw a growth of 14.1%, due largely to a 1% tax rate increase that took effect on August 1, 2019. Overall, New York State counties and New York City total sales tax revenue has decreased 10.7%, or $1.14 billion.
Regionally, neighboring Counties of Putnam and Ulster have both seen a sales tax revenue decrease of 6.4%. Orange County saw the largest decrease in the Hudson Valley of 11.5% followed by Rockland County at 8.8%.
Dutchess County towns and cities will also be impacted by this loss of revenue, due to a sales tax sharing agreement signed in 2013. While the towns and cities are guaranteed a baseline payment of $25 million according to the agreement, municipalities have often depended upon additional “growth payments” which totaled over $7.8 million in 2019. The municipalities rely on growth payments to ease the financial pressures they are facing. “It remains to be seen how significantly these payments to our partners in government will be impacted by the economic downturn.” added Comptroller Lois.
“With businesses opening up all over the state it is anticipated that sales tax revenue will slowly recover,” continued Comptroller Lois. “The hard steps we needed to take as a State and as a County to shut down businesses and isolate was a huge economic sacrifice, but a necessary one in light of this once-in-a-lifetime pandemic. It is imperative we all do our part, continue to be diligent, and support the social distancing and mask-wearing initiatives that are in place to keep us safe, and has helped keep Dutchess County COVID cases low. A resurgence and another shut down will undoubtedly strain our businesses and our County finances to a point we do not want to see.”
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