County Executive Mark C. Poloncarz is holding one number close to the vest as he prepares to unveil his first budget next week – how much the county will collect in property taxes next year.
Whether the proposed budget will increase the county tax rate remains undisclosed, despite a requirement that the county executive hand over all revenue estimates to the county comptroller by Oct. 1, so those projections can be reviewed.
Poloncarz’s budget director, instead, delivered the information without saying how much would be raised by county property taxes next year. That number had not been finalized by the time the information was due, Budget Director Robert W. Keating said in a letter to the comptroller.
The revenue projections did provide several clues about what could impact the 2013 budget:
• The assessed value of property in the county, which Poloncarz had expected to increase by 1 percent next year, now is slated to go down. Typically, the county receives some increased revenue each year as the assessed value of local properties goes up and those property owners pay more taxes. Next year will be only the fourth time since 1979 that tax assessments will have decreased, Keating said in a letter to the comptroller.
• The cost of fringe benefits for employees and retirees will continue to increase. The County Budget Office has forecast that health insurance and retirement expenses will increase by $13.8 million, or about 15.5 percent, next year compared with what was budgeted in 2012.
• Poloncarz has estimated that the county sales tax revenue will grow 3.65 percent compared with what was budgeted this year – a projection that County Comptroller David J. Shenk warned could be too high, given historic fluctuations in sales tax revenue.
“Given that the potential remains for a double-dip recession, this budgeted amount may prove overoptimistic and problematic,” Shenk warned in his analysis of the revenue projections.
Peter Anderson, a spokesman for Poloncarz, said the sales tax estimates are based on 3 percent growth over what county budget officials predict will be the actual amount the county receives in sales tax this year.
Based on what the county has collected so far, the Poloncarz administration anticipates the county’s share of sales tax this year will be $413.6 million – 3.15 percent more than what the county’s actual share of sales tax was in 2011.
“We disagree with some of the findings in the comptroller’s review but will not be discussing specific items until the budget is released on [Monday],” Anderson said.
Shenk also said he is concerned that the county executive plans to continue to dip into the county’s fund balance to help offset rising expenses next year.
Poloncarz, in the new revenue estimates and in his four-year plan, has called for the county to use $5.4 million from the fund balance next year and phase out the use of those funds in future years. The fund balance is money the county has left over from earlier budgets when revenues were greater than expenses.
How much the reduction in tax assessments will impact the county budget remains unclear. Poloncarz said in July that a reassessment of the Huntley Power Plant in the Town of Tonawanda was one reason overall assessment growth in the county has stagnated, but the revenue projections provided to the Comptroller’s Office did not specify how much assessments would decrease next year.
Poloncarz is scheduled to release his tentative budget Monday, setting off a lengthy review process by the Erie County Legislature that will likely finalize the annual county spending plan in December.
The County Charter requires the county executive to deliver estimates of all revenues for the next year’s budget, as well as several major expenditures, to the county comptroller by Oct. 1. Poloncarz, however, did not submit the tax levy estimates, despite seeking those same estimates from former County Executive Chris Collins in 2008 when Poloncarz was comptroller.