BALLSTON SPA -- Worried that a new GlobalFoundries computer chip factory could unfairly skew Saratoga County's sales tax distribution system in favor of the facility's host communities, officials are re-opening the debate over how the tax revenue is awarded to local governments.
Northumberland Supervisor Bill Peck, sworn in as the 2010 chairman of the county's Board of Supervisors on Monday, used the occasion to announce the creation of a new sales tax committee that will examine the decades-old distribution system this year.
Peck said the six-supervisor group will look specifically at what impact GlobalFoundries' $4.2 billion facility will have on the way funds are distributed to municipalities. It will not be asked to look at the possibility of increasing the sales tax rate, Peck said.
Under the current system, about half of the county's sales tax revenue stays with the county, while the remainder is awarded to villages, towns and cities using a formula based on each community's overall property values.
The setup creates stark differences in the amount doled out each year.
Clifton Park, for example, has received the largest amount of sales tax income so far this year - $7.9 million - while the village of Galway has received the least amount - a little more than $26,000. The city of Saratoga Springs is the only community not included in the distribution formula.
Peck said he fears that Malta and Stillwater, as hosts to the Luther Forest Technology Campus where GlobalFoundries is building, could receive an inordinate amount of sales tax income if the rules are left unchanged.
He offered no immediate suggestions for how the system could be re-configured, but he said the overriding goal is to come up with a way to distribute proceeds fairly and equitably.
Every community contributed in luring the computer chip maker and will have to deal with the impacts of its arrival, Peck said in describing the rationale behind his proposal.
"I'm not looking for anything out of the ordinary, just some fairness and equity," he said.
Wilton Supervisor Art Johnson, one of the six supervisors named to the new committee, said the discussion about changing the formula will be difficult to grasp until officials get a better idea of exactly what the computer chip factory's assessment will be.
The 222-acre site GlobalFoundries purchased in order to build the facility - which straddles the Malta-Stillwater town line - is due to receive its first partial assessment in March. Officials said the property is expected to be re-assessed annually.
And although the company has said the construction project could ultimately cost more than $4.2 billion, much of that money is tied to costly equipment needed to outfit the space, a cost that will not be included in the property value assessment.
"First and foremost, you have to know what the impact is, or to at least have an idea," said Johnson, whose town has received nearly $4 million from sales tax distributions so far this year.
Malta Supervisor Paul Sausville, whose town has received $2.8 million in sales tax income so far this year, said he was open to discussing changes.
But he also pointed out that the town has used ample resources to build and maintain new roads at the tech park, planning for GlobalFoundries' arrival and providing other services, such as fire protection.
The costs for inspecting the site alone will top $2 million, said Sausville, who will also sits on the sales tax committee.
"All of that takes a toll on us," Sausville said. "We're taxed to the limit right now."
If the town sees less revenue under a new system, Sausville said the county should also consider taking on more of the responsibility associated with hosting the factory in the future.
The move to re-examine the distribution system comes as sales tax income in the county falters for the first time in decades.
Final figures for 2009 are not in, but officials have estimated sales tax revenue could be as much as $8 million shy of the $52 million county leaders expected to receive this year.
Next year, officials estimate the county will receive $48 million in sales tax revenue.
Peck said his concerns about the formula originated three years ago, however, when he first saw leaders at the Ballston Spa Central School District talk about how much tax revenue they expected to get from GlobalFoundries.
"It came to light to me that this was a pretty big issue," he said.
Peck said he hoped the new committee would finish its work in the next six to seven months so that any proposed changes can be acted upon and approved by state lawmakers this year.
A date for the initial committee meeting has not been set.