OGDENSBURG – The city council decided on Wednesday evening to keep the last 1% of sales tax within the city limits instead of sharing it with the county.
The council members passed the resolution 6-0 as council member Nichole L. Kennedy was absent from the council meeting on Wednesday evening.
The resolution states that the St. Lawrence County’s Board of Legislators has proposed a new agreement that would allow the city to receive a lower portion of the sales tax it collects. The city council believes that it is not in the best interests of the city to reach a new agreement with the county, but to pursue prevention and collect its own sales tax.
City administrator Stephen P. Jellie said the city would use the formula the county would prefer to transition over to give the city the same share of sales tax as cities and villages, with sales tax revenue of 1.9 million for 2020 . USD would have received. Under the current agreement, the city raised $ 4 million last year.
“Essentially,” said Mr. Jellie, “$ 2.1 million would have been the hit.”
The current formula calls for 4% of sales tax revenue to be distributed to the county. The district keeps 50% of the first 3% and distributes 6.44% to the city. The remaining 43.56% will be distributed to towns and villages based on property value and population.
The district retains 83.56% of the additional 1% of sales tax and distributes 6.44% to the city. The remaining 10% is distributed to towns and villages based on property value and population.
“Fifty percent, 55 percent of our second highest income form – the formula (county officials) we provide just can’t work for us,” added Jellie, adding services equivalent to $ 2.1 million. “
According to the resolution, the city has the authority to prevent 3% sales tax under state law. The state tax law states that the county has the “sole right” to levy an additional 1% sales tax, which is not subject to the preliminary ruling.
According to the decision, the legislature has in the past granted certain cities and districts the right to levy an additional sales tax of 1% under the Tax Act.
The resolution states that the city must enact its local sales tax law no later than September 1st.
The decision was made after deadlocked discussions with county officials so that the city can begin collecting its own sales tax. The city and county had been going back and forth since last year before the county legislature finally shot down city officials as they looked for an extension to the current formula.
Ogdensburg is the only town in St. Lawrence County, and therefore the only state licensed parish to negotiate the sales tax distribution formula with the county. This prompted the city to advocate expanding the current formula to further consider long-term options, including prevention.
After the denials of the extension, the city decided, according to Jellie, “to start the process of prevention”. The preventive process that would allow the city to develop its own formula for collecting sales taxes directly from the state involves laws at the state level before a county-separate formula can be implemented.
If the city completes the pre-emptive process, Ogdensburg would be stripped entirely from the county equation and “bet on the idea that they’d make more money if they could collect their own tax,” District Attorney Stephen D. Button told lawmakers earlier this year .
Mayor Jeffrey M. Skelly told city councils on Wednesday that years ago there was 3% sales tax and the city was able to collect half of it – meaning the city amassed 1.5% of the 3% within the city limits.
There’s now a fourth cent, Mayor Skelly said, which increased sales tax from 7% to 8%.
The resolution passed on Wednesday essentially calls on local state officials such as Senator Patricia A. Ritchie, R-Heuvelton, and Rep. Mark C. Walczyk, R-Watertown, to come up with a bill either in the Senate or in the Assembly providing permission You the last dime to go straight to town, not the county.
“We’re not raising sales tax at all,” said Alderman John A. Rishe on Wednesday. “What we’re doing is that the county wouldn’t give us another agreement in which we shared the revenue. They refused to do that. So we have to go alone and we don’t have the ability to collect what is currently being collected … we have to have state legislation to do this.
“If we’re successful,” he added, “the local share would stay 4 percent of the total 8 percent.”
Councilor Daniel E. Skamperle asked if the resolution included the city in the prevention process.
“We have no choice,” said Rishe.
Councilor Michael B. Powers stepped in and asked if sales tax negotiations with the county were really over.
“It was over when they voted,” said Rishe, “and they rejected two resolutions and refused to do either.”
City administrator Stephen P. Jellie said there had been no further talks between city and county officials about sales tax.
After the legislature agreed in August last year to extend the deadline to November 30 of this year, a proposal was made for an additional extension of two years until November 30, 2023. That resolution failed last month by 8-7 votes at the county’s finance committee, but not before an amendment that limited the extension to 2022, it also failed 8-7 against the opposite.
When the city’s November 30 deadline is up, its share of the county’s sales tax revenue will be aggregated with cities and villages, and the city will receive a share based on its population and estimated property value through 2030. At that point, new formula negotiations will take place instead of starting.
“It’s possible the county may have a change of heart,” Mayor Skelly said, “but the fact is we have through November and the contract expires.” If we don’t get legislation … from New York State, then we don’t get that (last) penny. “
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