QUEENSBURY — A Queensbury supervisor pitched a plan Thursday to increase Warren County’s sales tax rate so property taxes could be cut for county residents as county leaders debate how best to divvy up sales tax receipts.
Queensbury at-Large Supervisor Doug Beaty asked his fellow county supervisors to support a plan he believes would transfer much of the county’s property tax burden to visitors who come to the region. He termed it a “school tax” reduction program.
He proposed raising the sales tax to 8%, on par with or lower than the majority of New York counties, and splitting the money (estimated at between $17 million and $19 million annually) between school districts and municipalities to lessen property tax burdens.
County residents would come out ahead because an estimated 40% of the sales tax paid in the county comes from tourists and visitors, so outside money would be used to offset local property taxes, Beaty said.
Beaty, who worked with Queensbury Town Board candidate and Warren-Washington Counties IDA member Travis Whitehead on the plan, said he has had numerous financial professionals review the numbers, and all agreed it would benefit county residents, financially.
He has begun speaking with school officials as well, and the discussion has been encouraging, he said. The key will be getting officials’ pledge that the money will go to reducing the tax levy instead of additional spending.
Beaty said he is not an advocate for increasing taxes, but hiking the sales tax is a way to give local taxpayers a break if the money is used correctly.
“For every $2 that a Warren County resident pays, they will be getting a $3 break in school or property taxes, so I do not view this as a tax increase, except for the out-of-county people who will still be paying no more and often less than they would in their home counties,” he said. “This will be a tax reduction for county residents.”
While some expressed concern about how the plan could affect car sales, Beaty said the county’s car dealers would not lose business, because buyers pay the sales tax rate in their home county. So the increase should not deter residents of nearby counties from buying cars locally.
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Bolton Supervisor Ron Conover, chairman of the county Board of Supervisors, said the board had to be careful about making moves that could hurt the county’s economy.
No action was taken, but Beaty’s proposal was scheduled for more discussion at the November meeting of the Board of Supervisors.
The proposal received mixed responses Thursday, as county supervisors again discussed complaints by some leaders that the sales tax distribution formula is unfair to towns without much waterfront property, particularly Lake George waterfront. Sales tax is distributed to towns based on assessed value of property instead of population, so towns such as Bolton, Hague and Horicon benefit while towns like Warrensburg and Lake Luzerne are hurt.
County Administrator Ryan Moore said the county must distribute sales tax receipts based on assessed value, because the city of Glens Falls elects to receive its receipts separately from the county. Under state law, that triggered the current distribution formula more than 50 years ago. State legislator approval, and a change to Glens Falls practices, would be needed to change it.
Another emotional discussion lasting nearly 90 minutes ensued, with supervisors of towns that receive more money not willing to relent.
“This issue has been divisive,” Moore said. “It’s divided the board and I haven’t enjoyed watching it.”
A number of supervisors have broached a 1% sales tax increase in recent months as the board struggles over the distribution formula. The proposal has been shot down in the past because of concerns from the business community.
Warren, Washington and Saratoga counties are the only ones in the state that impose a 7% sales tax. Three percent of it goes to the county, 4% to the state.
Sales tax rates in other counties range from 8% to 8.875%.