We
hold these truths to be self-evident: 1) You can’t cut taxes and maintain the
same level of services; and 2) Even acknowledging the truth of the first,
people will punish the candidate who says tax increases are a possibility.
But Bill Johnson’s not the only
person who says Monroe County might have to raise property taxes to deal with a
budget deficit. Despite Maggie Brooks’ pledge to continue the Doyle legacy of
freezing the property tax levy, several Republican county legislators say a
property tax increase might be necessary this year.
For a moment, it looked as if Jack
Doyle had pulled a rabbit out of his hat, again. Faced with a $40 million to
$50 million deficit and a budget deadline that fell right before the county
executive election, chances were that he’d have to cut popular county programs
and services so deeply that he’d infuriate voters, or go back on his word and
raise property taxes. That would help Bill Johnson, the Democratic candidate
for county executive. It would hurt Johnson’s opponent, Republican Maggie
Brooks.
Instead, Doyle seemed to have
finessed the Democrats. He closed much of the budget gap with an increase in
the sales tax (which many voters seem to find painless). He actually increases
funding for some popular arts programs, which would please suburban voters. And
the majority of his cuts hit city residents (who’ll vote for Johnson anyway)
and the poor (many of whom don’t vote).
But Democrats in both the county
legislature and state assembly insist that the sales tax proposal is going
nowhere. A change in the sales tax rate must be approved by both the state
senate — where Republicans rule — and the state assembly. Dems have a lock
in the assembly and have proclaimed the sales tax hike dead on arrival.
That could throw the county into
financial chaos — and make the Democrats look bad.
But late last week, there were
strong signs that the Doyle proposal has waning support among local
Republicans, too. They may even be willing to vote for a property tax increase.
“I’m sure there are a number of
legislators who would support a property tax increase,” says Republican County
Legislator Mark Assini. “It’s possible there are enough votes for that.”
When pushed, Assini adds that a
property tax increase is “a likely scenario.”
“If I were a betting man, I’d say
that probably will be the way this gap is closed — a property tax increase.”
Both Assini and fellow Republican
County Legislator Ray Santirocco say it would be pointless to approve a sales
tax increase, knowing the assembly won’t go along.
“I wouldn’t vote for it,” Assini
says. “How could I vote for a revenue stream that doesn’t exist?”
“It’s a dead issue at the moment,”
Santirocco says. He has no reason, he says, to believe the assembly will go
back on its pledge to kill the increase. If the county lej approves the Doyle
proposal as is, he says, it will include the “phantom” additional sales tax
revenue and “I don’t know if we want to do that.”
Santirocco was
one of six Republicans who voted for a property-tax increase to solve last year’s budget
problem. The others were Pieter Smeenk, Karla Boyce, Mike Hanna, George
Wiedemer, and Peter McCann.
Santirocco calls Doyle’s insistence
that a property tax freeze is necessary to draw and retain businesses and jobs
to Monroe County “overstated.” The decisions businesses make have more to do,
he says, with the incentives the county offers through COMIDA and other
programs.
But Republican Majority Leader Bill
Smith says he and other Republicans will try to balance the budget without
resorting to a tax increase of any kind. That means cuts.
“At this point, everything has to be
on the table,” he says, adding that, in terms of preservation, priority will be
given to programs and services that get the most use, including libraries, parks,
highway maintenance, and public safety.
A tax increase, Smith says, is “a
last resort.”
But Santirocco argues that gutting
$40 million from the budget would destroy the fabric of the community.
“We just can’t do that,” he says.
“It’s unrealistic to think we can do it [balance the budget] with future cuts.”
If the sales tax increase dies and
the cuts don’t happen, the legislature will “have to look seriously at the
property tax,” Santirocco says.
The Democrats are hanging tough.
Sales tax makes Monroe County noncompetitive with surrounding counties, Dems
say, and hits middle and low-income people the hardest.
“There’s no sympathy for the sales
tax [among Democrats],” says Stephanie Aldersley, Democratic leader in the
county lej.
Doyle’s proposal, say county and
state Democrats, is an attempt to put Monroe County’s fiscal problems on the
shoulders of state representatives. Democrats worry, too, that it will set a
dangerous precedent for other counties in similar financial straits.
Privately, state Democrats worry
about voter retaliation at the polls should lawmakers approve a jump in the
sales tax. They also dislike the county’s plan to keep the entire
six-tenths-of-a-penny sales tax increase itself, instead of sharing the additional
revenue with the city. And state Dems are smarting over Doyle’s refusal to give
them a heads-up that the sales tax proposal was in the works.
“We found out about it the same way
as everybody else, through the press,” says a spokesperson for state Assemblyman
David Gantt. “At the very least, he should have called them beforehand.”
Monroe County
has three options, according to Republican State Senator Joe Robach: raise
sales tax, raise property tax, or cut services. He hopes the county is
“exhausting every means they can” before voting for a tax increase of any kind.
“They have a challenging task,” he
says.
The senate would probably approve
the sales tax proposal, Robach says, if it makes it that far.
“They [Monroe County] are the ones
responsible for making the decision,” he says, adding that the senate
historically tries to honor the will of the local municipality.
Even if the sales tax proposal is
enacted, it’s, at best, a temporary reprieve for the county, say local
lawmakers.
“What we have is a real structural
problem,” says Democratic County Legislator Carla Palumbo. “This doesn’t solve
it.”
“It won’t make it an easy ride,”
adds Santirocco. “It would get us some distance, but I don’t know how far.”
Doyle wants the sales tax boost to
offset ongoing increases for Medicaid, public assistance benefits, and employee
pension costs. Mandated expenses, he says, are driving the county to the brink
of ruin.
Assini offers a dire prediction. As
long as the state continues to expand programs like Medicaid, he says, county
governments will start to shrink.
“It will not be long before those
mandates will force county governments to go out of business,” he says. “I
predict within 10 years.”
Devilish
details
Every
budget is, at best, a prediction. And County Executive Jack Doyle’s 2004 budget
for Monroe County is no exception.
In many cases, revenues and savings
are based on learned expectations, forthcoming grants, or impending
efficiencies. But there are a few predictions in Monroe County’s 2004 budget
that seem soft. Following is our list of budgetary projections worth watching:
Frontier fairy
tale: When
Frontier Field was built in 1995, then-County Executive Bob King promised it
would never cost taxpayers a penny. But from 1995 to 2002, the county has spent
$8.9 million more on Frontier Field’s operating costs than it has received in
revenue from the stadium.
This is due, mainly, to the 20-year
lease agreement the county signed with the Rochester Red Wings. In the same
period that the county subsidized Frontier by nearly $9 million, the Red Wings
have reported $4,064,473 in net profits.
Under the terms of the Wings’
20-year lease, the team would pay more if its season-long attendance tops
300,000. The Red Wings consistently fall short of that number.
The facility, which opened in 1996,
cost roughly $41.5 million to build. The state pitched in a $16 million grant
toward construction costs, but the county covered much of the rest of the
expense with county-backed bonds. The county still owes millions on the stadium,
and servicing that debt costs county taxpayers about $1.7 million a year.
Late last year, County Executive
Jack Doyle decided to redirect roughly $700,000 in annual income generated by
an increase in the hotel occupancy tax toward debt payments on Frontier Field
(the money was initially earmarked for PaeTec Park). But even with that money,
it has left the county with about $1 million on average to pick up every year.
The 2003 and 2004 budgets both call
for the county to break even on the stadium. In 2002, the county had to
subsidize Frontier by $424,176.And the beautiful sports facility’s finances
won’t improve much next year, when its second-most-important tenants, the
Rochester Rhinos, leave for their own facility nearby.
Crime might
pay: Monroe
County’s 2004 budget includes $3,560,500 in anticipated revenue from “jail
facilities charges — federal & local.” (This is money other governments
pay the county to hold prisoners waiting for arraignment.) Last year, the
county pulled in $1,082,000 in the same jail facilities charges. Why the huge
increase? The budget says it’s due to “a negotiated increase in the daily rate
and also based on experience and expectation of an increase in the number of
inmates housed.”
So what’s this expectation based on?
And is it safe to assume the county will be able to pull in more than three
times the projection for 2003? (The 2003 fiscal year is not over yet.)
Blood from a
stone: The
county is anticipating nearly $3.6 million in savings after “implementing
management consulting firm recommendations.” This is the type of top-down
approach to efficiency for which Doyle has drawn criticism. Instead of having
consulting groups determine the amount of potential savings, Monroe County
seems to be giving them specific monetary goals to shoot for.
The county insists that it will save
$30 million in 2003 due to reforms in the Department of Social Services. That’s
about what the county predicted it would save. But critics say that’s not
likely, since the county had predicted that welfare caseloads would fall.
Instead, they’ve gone up.
The big
turnaround: Jack Doyle is predicting that the economy will start recovering soon enough to
impact the 2004 budget. Even without his proposed sales tax increase, Doyle
expects the county to receive more sales tax revenue in 2004 than it did in
2003. In fact, he expects that revenue to increase by nearly $2 million, from
$114 million to $116 million.
This article appears in Oct 29 – Nov 4, 2003.
