The possible elimination of state aid to municipalities is sparking a drive to change how Schoharie County distributes sales tax revenue to towns and villages.
The change at the local level would redistribute thousands of dollars from towns with little commercial activity––Gilboa, Wright and others––to villages––Cobleskill, Middleburgh, Schoharie, Richmondville, Sharon Springs and Esperance.
Although redistributing sales tax revenue has been discussed before, Governor Andrew Cuomo’s recent proposals raised the issue again.
The Governor’s proposed budget would eliminate Aid and Incentives to Municipalities (AIM). The Village of Cobleskill would lose $31,461, and the other villages would lose lesser––but still important––amounts.
To replace AIM, Governor Cuomo wants a new tax on internet sales to go to towns and villages. The new tax isn’t law yet, so nobody knows how much it would raise.
The local concern is that the county distributes sales tax revenue according to assessed property value and presumably would do so with the internet tax revenue. Village officials feel they’ve been short-changed all along––and would be again––because their commercial centers generate most of the sales tax.
Richmondville Mayor Kevin Neary is active with the state Conference of Mayors, which wants the Governor to restore AIM.
While restoring AIM is a top priority––and maybe an unlikely one––local village officials want a change in the distribution of sales tax revenue.
“We [villages] are at a disadvantage because the county decides how to appropriate that money,” Mayor Neary said.
“We don’t get a fair share of the revenue we provide.”
He wants the Board of Supervisors to change the distribution formula from assessed property value to population. To that end, Mayor Neary is looking for village officials to meet with supervisors.
And Cobleskill Supervisor Leo McAllister is ready to listen.
“Kevin has an excellent point,” Mr. McAllister said. “This one of the things I wanted to work on.”
He pointed to the 2018 fourth-quarter sales tax distribution that supervisors approved February 15. The Town and Village of Cobleskill received about $36,000, while Gilboa––with little commercial activity to generate sales tax––received nearly $24,000.
“Ludicrous. Absolutely ludicrous,” Mr. McAllister said.
Not to single out Gilboa, but other towns with little business also received sizable amounts; Blenheim, Carlisle, Wright and Jefferson all received more than $10,000 in 2018’s fourth quarter.
Village officials argue that they should get more revenue because not only are they population centers, but they need the revenue to maintain infrastructure that supports businesses.
Cobleskill Mayor Linda Holmes wants that extra revenue, in particular, to repair now-rough Grandview Drive, the street to Cobleskill Regional Hospital and the Bassett Health Clinic. Everyone in the county uses that street, Mayor Holmes said.
“It’s antiquated and has never been fair,” she said of the revenue distribution. “And what are your catalysts for economic development in the county? It’s the villages.”
Patty Johnstone is a trustee on the Sharon Springs Village Board and is also president of the Schoharie County Village Officers Association. Like Mayors Holmes and Neary and Mr. McAllister, she believes the distribution formula should change.
“It should be by per capita,” Ms. Johnstone said.
“Just because it’s always been done the way it is doesn’t mean it should stay that way.”
And also like Mayor Neary, Ms. Johnstone believes the villages––commercial and population hubs––should have a say in how the revenue is distributed.
“We’re being left out of that conversation,” she said.