Taking a firm stand for the first time in public on reducing the city’s share of sales tax revenue, County Executive Mike Hein has charged the City of Kingston with accepting some $8 million from the county in Safety Net welfare relief over the past four years and using it to “mask” a collective spending increase of almost 40 percent.
The record shows city spending increased from $36.5 million to $40.7 million between 2012 and 2016 (about 11.5 percent) with a corresponding increase in the property tax levy of almost $4 million. Former mayor James Sottile drew up and the Common Council approved the 2012 budget. The council, over outgoing Mayor Gallo’s veto, adopted the 2016 budget Gallo proposed, the council modified and new Mayor Steve Noble will administer. All the budgets stayed within Kingston’s particular limit for property tax levy hikes in those years.
“I have no idea where they’re getting those numbers. They’re not calling us and asking for information,” Noble said after attending Hein’s speech.
Noble said the city’s share of Safety Net welfare costs prior to county takeover was carried in the budget as a separate item, like the library fees. “Eliminating it had no impact on our general fund,” he said.
Hein raised the subject of sales tax himself during a 10-minute question and answer session following his speech before almost 300 attendees at an Ulster Regional Chamber of Commerce breakfast at the Best Western Hotel early Tuesday morning, Feb. 23.
“I’m not singling out the city. They’re just the biggest one,” Hein told. He has accused the county’s 20 towns of acting in similar fashion.
The five-year sales tax distribution agreement between the city and the county expires on Feb. 29. Under the current agreement, the city gets 11.5 percent of sales tax revenues collected by the county (worth about $12.5 million a year), while the towns divide three percent (worth about $3.5 million). The county keeps the rest, budgeted at $110 million in 2016.
Hein noted that the county has picked up some $22 million of city and town Safety Net and election expenses over the past four years — and anticipates spending $32 million over the next four. A proposal first made by county legislature Ways & Means Committee Chairman Richard Gerentine proposed reducing the city’s share to the 2001 level of 10 percent and the towns to 2 percent. City and town officials have strongly protested, arguing that a reduction in county sales tax support would require them to either reduce services or raise property taxes.
Mike Hein, speaking Wednesday morning, said he has never proposed any specific number, “in any way, shape or form,” of a revised sales tax formula and said he was looking forward to weighing in on the matter at a future date.
Directly following the breakfast, Noble told the Ulster County Town Supervisors’ Association meeting that “he [Hein] accused us of really misusing the funds that we have, basically saying we raised the property tax by 40 percent in the last three years. I think if that were the case, all of us would have been voted out of office.” He said that Hein was “taking his message to the business community. I’m not sure it’s holding a lot of weight, there were a lot of people rolling their eyes as he was speaking about this issue. But he’s attempting to broker this deal. I’ll be honest. We are not interested in negotiating behind closed doors on this.”
Noble called out the county legislature, saying he was excited that “the Kingston Common Council has stepped up and this Wednesday we have a special full council meeting … to pass a resolution authorizing me to sign a contract that I will be signing that says the City of Kingston will receive 11.5 percent and that the towns will receive 3 percent, the county will receive the rest, and we will be sending that to the county legislature for their review. I hope they will bring it to the floor for an up or down vote because I want to know where the legislature stands on this issue, as well as the county executive, because no one has publicly sent us anything in terms of a proposal of what they want, so I’m telling the county what I want, what I think is the best for the City of Kingston residents.”