Sales tax revenue appears to stabilize in Nassau, Suffolk

Sales tax collections that fund much of Nassau and Suffolk County government appear to have stabilized after falling sharply last year, officials said Thursday.

In Nassau, sales taxes were up 3 percent for the first quarter of this year, or $6 million more than the same period last year, according to county Comptroller George Maragos.

Robert Lipp, director of the Suffolk Legislature's budget review office, reported that county sales tax revenue was essentially flat for the quarter -- down .08 percent or $l83,096 from last year.

At the same time last year, Nassau collections were down 14.8 percent while Suffolk revenue had fallen 1.7 percent. Sales tax receipts continued to lag, leaving Nassau with a $70 million shortfall by the end of 2014. Suffolk's collections fell $28.5 million short of the adopted 2014 budget.

Officials in both counties last year initially blamed the harsh 2013-14 winter, but later acknowledged that spending dropped after the one-time boost in 2013 as homeowners and businesses rebuilt after superstorm Sandy.

Lipp Thursday again blamed harsh weather, including "the coldest February in three decades" and the drop in gasoline prices for a short-term negative impact on this year's sales taxes.

Nassau County Executive Edward Mangano continued to question last year's numbers.

"This 3 percent growth in sales tax receipts is good news and we believe the past abnormality could be an auditing error," he said in a statement. "The administration is working with New York State Department of Tax and Finance to identify any deficiencies in prior checks."

Sales taxes fund 40 percent of Nassau's $2.98 billion budget.

Maragos attributed the 3 percent increase in Nassau to an improving economy, reduced unemployment, wage gains and growing consumer confidence. The positive results "will relieve the fiscal pressures on the county from the poor results of the prior year," Maragos said.

Nassau Legis. Judy Jacobs (D-Woodbury) said, "Its a blip in the right direction, but not enough."

Because of last year's dip, Nassau needs sales tax revenue to grow by 5.2 percent for the rest of the year to meet budget, officials said. If collections continue at 3 percent, the sales tax shortfall will be $20 million.

Suffolk had budgeted a 4.86 percent sales tax increase this year. Because of the 2014 shortfall, the county needs revenue to increase by 6.4 percent to meet this year's budget.

Suffolk County budget director Connie Corso said the latest sales tax numbers indicate the county is facing a sales tax shortfall this year of $20 million to $30 million.

However, Deputy County Executive Jon Schneider noted that building permits are up. "We're hopeful once the ground thaws, people will start spending money and we'll have a nice summer to make up for the brutal winter," he said.

Presiding Officer DuWayne Gregory (D-Amityville) said the numbers show "we're continuing to struggle with our economy."

The executive and legislative budget offices will make presentations to the Suffolk legislature's finance committee April 21 to lay out how they plan to proceed for the rest of the year.