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PLAN TO MAKE 8% SALES TAX PERMANENT DIES

A plan to make permanent Erie County's eighth-penny surcharge of the sales tax apparently has died a quiet and quick death.

With no fanfare, a bill has been introduced in the State Legislature to again extend for one more year the 1-cent-per-dollar sales-tax surcharge, first put in place a dozen years ago.

With proponents insisting the public is not fooled by a "temporary" tax first passed in 1985, the Erie County Legislature three weeks ago voted to ask that the tax be made permanent. But the measure was approved with only 11 votes, all Democrats, which is one short of what would be needed if the matter was handed back to the county lawmakers for final approval if the State Legislature were to back the plan.

"I just don't see it happening," State Sen. Dale M. Volker, R-Depew, said of the permanent surcharge proposal. "There's no indication to us that they can come up with the (12) votes."

Even if the county lawmakers could muster enough votes, Volker said he has seen little support for the proposal among western New York legislators.

"It would be difficult to pass in either house," Volker said, because "it would make Erie County the only county in the state that would have permanently extended the additional sales tax."

Legislative sources also said state legislators, all of whom are up for re-election next fall, were not keen on attaching their name to what would be -- despite the surcharge's existence since 1985 -- a tax hike with the word "permanent."

Volker's measure surfaced in a list of bills that have been "prefiled" for the State Legislature to consider when it convenes Jan. 7. No companion bill to Volker's was found for the Assembly, though Volker said such legislation will be introduced any day.

Volker said he has already been in contact with Erie County Executive Gorski to inform him the votes aren't there for the permanent sales-tax surcharge.

Erie County Budget Director Kenneth Kruly said Gorski and Volker agreed to go ahead again with the temporary surcharge to ensure revenue is not interrupted.

"The conventional wisdom is that (the permanent surcharge) won't be approved," he acknowledged.

Kruly suggested state lawmakers did not want to break with what has become the tradition with other sales-tax surcharges enacted around the state in recent years; most, if not all, have one- to three-year sunset provisions before needing to be extended again by the local and state legislatures.

Kruly criticized the practice of the county having to annually get Albany's OK to extend the surcharge, which is worth $100 million to the county treasury.

"I'm sure it doesn't help with the bond-rating agencies," Kruly said of Wall Street rating firms that judge the county's bond offerings based in part on the certainty of revenue.

"The whole matter can't proceed until the County Legislature, in an act that will have the Democrats eating some political crow, reverses itself and asks the State Legislature to temporarily extend the surcharge."

Twelve votes will be needed by the County Legislature for the temporary surcharge request. The Democrats, who will see their dominance slip to 10 members come January, after losing a seat in the November elections, will need to enlist Republicans for help with that proposal.

The surcharge was set up in 1985 to help with the government's fiscal crisis. With the county's fiscal picture improving from that time, some lawmakers are suggest that the county share some of the money with other local governments. This could surface as an issue in the coming weeks.

"We've told the County Legislature, 'Look, if you guys are real serious about this (permanent) surcharge, give us a request with enough votes to do it. . . .' They just haven't been able to do that," Volker said.

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