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Reasons for holding sales tax

As many people know, the County Legislature will be voting tonight on raising the sales tax from 7.5 percent to 8 percent.

Proponents of raising the sales tax point to the additional $7.6 million per year that will be raised (a portion supposedly used to reduce property taxes), the inequity of Chautauqua County’s property tax rate compared to a neighboring county, while downplaying the regressive nature of the sales tax.

Let’s look at some of these arguments.

Regarding the $7.6 million in additional sales tax revenue, the amount of money mentioned that will be used to reduce property taxes is $1 million to $2 million. How will the remaining $5.6 million to $6.6 million be spent?

Does anyone remember the $26 million tobacco settlement money the county received a few years ago?

Did you notice any substantial reduction in your property taxes at that time, or more recently the sale of the County Home? Many times did we read in the newspaper that the Home was costing us $9,000 per day and that if we sold it we would be saving $3.2 million per year? That savings, plus the proceeds from the sale of the Home – selling price $16 million – would result in lower property taxes.

Actually, that did happen. The County Legislature was able to lower the property tax rate two cents, from $9.17 per thousand to $9.15 per thousand dollars of assessed valuation, or $20 on a $100,000 home.

As far as the inequity of Chautauqua County’s property tax rate, yes there are counties in Western New York that have a lower property tax rate than Chautauqua County. But there are also neighboring counties such as Cattaraugus and Allegany that have property tax rates of $13.19 and $15.83.

Besides having higher property tax rates than Chautauqua County, Cattaraugus County has an 8 percent sales tax, and Alleghany an 8.5 percent sales tax.

The regressiveness of an increase in the sales tax is downplayed by mentioning the clothing tax exemption on purchases under $110, unprepared food and residential energy. But what about prepared foods, electric bills, phone bills, building materials to repair one’s home, parts to repair the family car, appliances, etc.? Won’t seniors, people living on fixed incomes, and working families living from paycheck to paycheck be hurt more by a rise in the sales tax than upper middle class and rich individuals? I happen to think so.

Instead of viewing the 7.5 percent sales tax as a negative, why not view it as a positive? Why not view it as a safety net, to be used should the county face a financial calamity in the future. Or better yet, how about viewing it as a thank you to the county’s small businesses and retailers who have to compete with a 6 percent sales tax in both Erie and Warren counties in Pennsylvania?

Small businesses and retailers who despite hardships, provide jobs, generously support our local sports teams, churches, civic organizations and continue to be the backbone of economic activity in Chautauqua County.

Lastly, the county’s fund balance – the amount of money we should have on hand at the end of 2015 – is projected to be $17,244,120; the highest it’s been in years.

I don’t believe it is necessary to increase the sales tax at this time.

Government, in this case county government’s problem, is not that we are not raising enough revenues. It’s that we are not doing enough to find innovative ways or make the difficult decisions, necessary to reduce spending. Therefore, I will be voting no on the resolution to increase the sales tax.

Terry Niebel is a county legislator from District 5, representing the towns of Arkwright, Villenova, Sheridan, the town and village of Cherry Creek, and part of the town of Pomfret.

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