County should direct some of its sales tax money to community projects
Editorial: Villages and towns shoulder burden of beautification, but county keeps revenue
Orleans County officials could learn from the state when it comes to sharing revenue.
About a decade ago the state allowed video gaming machines at race tracks. The sites have been big money-makers for the state, but Albany was smart not to hoard all of the cash.
Initially, the state talked about keeping 70 percent of the profits from the gaming sites. But that left the operators with too little money to fully staff the sites, market the gaming machines and also keep up their facilities, particularly in a competitive gambling industry with nearby Native American-owned casinos.
The state relented. Its share is currently 41 percent of profits at sites such as Batavia Downs, which ended the state fiscal year with a net revenue of $47.1 million in 2013-14. The state collected $19.3 million of that.
The Downs gets 25 percent as for an “agent commission” or nearly $12 million. That is more than enough to cover its costs.
The state also dictated that 10 percent of net revenue or $4.71 million be used for marketing. The state Lottery mandates video gaming sites spend marketing money to bring in customers and better compete with the Indian-owned casinos. Some of that money was used by the Downs to hire Hall of Fame running back Thurman Thomas as an ambassador.
The state also is forcing the operators to set aside 4 percent of the profits for capital improvements. That is about $1.8 million annually at Batavia Downs. That requirement is a big reason why the Downs is undergoing a $27 million expansion and renovation. It no longer feels like an old race track.
Why do I bring this up? In Orleans County we take in about $15 million a year for our share of the sales tax. The state also gets about $15 million in sales for taxable transactions in the county.
The County Legislature decides how to divvy up the $15 million local share. In some counties, the county government will keep half of the money and give the rest with cities, towns and villages. That helps those municipalities fund their government services and ease the burden on property taxes.
That’s how it’s done in Genesee County, which brings in about $38 million in sales tax a year. The county isn’t much bigger than Orleans – 60,000 people in Genesee compared to about 42,000 in Orleans.
Orleans keeps about 92 percent of the total local share. It gives $1,366,671 to the towns and villages. That $1,366,671 hasn’t changed since 2001, when the Legislature chose to freeze the portion to the villages and towns.
A walking trail and pedestrian bridge has been proposed by the Glenwood Lake Commission near the Medina Waterfalls but the project hasn’t moved forward.
I’ve written before about how the county should give more money to the towns and villages, especially the villages which are dense population centers with lots of needs and government services. Many of the businesses that generate the sales tax are also in the villages.
I don’t think the county will give more to the villages or towns. That’s what they’ve told me. In fact, they sometimes threaten to zero out the towns and villages. I don’t see much hope for more money.
I’ve been personally involved in some community projects, whether trying to establish a Sandstone Trail along Route 31 or have a bronze statue erected of a quarryman in downtown Albion. These are in their infancy. Money is always an issue.
I know other people have proposed projects that would draw people to the county, boosting our sales tax. One proposal has been on the shelf for five years. The Glenwood Lake Commission proposed a walking trail to the Medina Waterfalls with a pedestrian bridge crossing the Oak Orchard River upstream near Glenwood Lake. Full development of that would be about $2 million. The state could pay 75 percent of the project with a successful grant application, but you still have a local share and ongoing maintenance.
The Albion Recreation Committee would like a spray park at Bullard, but it seems cost prohibitive for the village. The spray park would draw people from around the county, and outside our borders.
There are other projects – from murals to more attractive welcome signs – that could give our community a little more luster.
If you look at community development projects locally, the burden for getting it done rests almost entirely on a town or village. Those municipalities could invest big money into drawing more people here, yet they wouldn’t see an increase in sales tax benefits. That would go to the county, which isn’t investing in these type of projects off county land.
I would suggest setting aside a measly 1 percent of the total sales tax – that’s $150,000 of the $15 million – and directing it to capital improvements in villages and towns. This wouldn’t be basic infrastructure, such as streets and municipal buildings, but at sites that could draw folks to the area (could be parks or canal facilities, for example). That 1 percent is probably too low, but it could be a starting point.
The county should establish a committee with representation from the four villages and 10 towns. The county could take another lesson from the state’s playbook in making the awards competitive, with money going to the best projects.
Gov. Cuomo and the Legislature established Regional Economic Development Councils and communities have to present projects and make their case for funding each year. The state wants to see jobs and economic development from projects.
The state has funded many heritage trails and tourism projects, believing they help stir commerce, especially in smaller towns. But you still need that local match and the Orleans communities haven’t been going after these type of grants. But if the county dedicated some of the sales tax for that local match, some of the projects could go forward because the villages and towns wouldn’t have to bear the full local cost.
If the county established a sales tax committee, the $150,000 should go to the projects with the most potential to bring in people and help drive sales to businesses.
Going back to the video gaming and the 10 percent marketing requirement, the county should also set aside 1 percent of the sales tax for marketing and special events.
I was struck by the crowd last January at a “Finally Fridays” concert at Lee-Whedon Memorial Library in Medina. There were 150 people there on a bitterly cold night. The library puts on the concerts with little to no support from the county. Yet those concerts get people out of their houses. The concert-goers use gas, and many likely go out for dinner. Those concerts create commerce and sales tax.
The $150,000 for marketing could be used to help fund concert series, festivals and other special events. If you look at the current staple of festivals, most are organized by villages, towns, service clubs or other volunteers. They put a lot of time and money into it, and those events make money for the county.
The committee could direct how to best divvy up the marketing and special events dollars.
With 1 percent for capital projects and 1 percent for marketing and special events, the county would be giving up $300,000 total. But I bet they would see a solid return on that investment with more sales tax. That’s better odds than at Batavia Downs.