County officials fear plummeting sales tax revenue, state reimbursement cuts

Photo by Tom Rivers: County Legislator John DeFilipps, R-Clarendon, reads the resolution this morning calling for temporary county layoffs. It passed in a 7-0 vote.

ALBION – The county government workforce will shrink by 40 employees or about 10 percent as the county grapples with declining sales tax revenue and anticipated reduced state reimbursements.

The county could face big losses in sales tax revenue and expects cuts in state reimbursements for other services. The stock market decline also will mean local government will have to pay more in pension contributions.

“We’re in unchartered territory here,” said Jack Welch, the county’s chief administrative officer.

The county annually receives about $17 million in sales tax. March was down 9 percent and that’s only with nonessential businesses closed for about two weeks.

Early projections from the state comptroller estimated the county would take a minimal hit of about $559,000. That estimate for the minimal decrease has since been doubled to about $1.1 million. And that’s on the low side. The county could see a bigger loss.

“We have no idea how bad it could get,” Welch said.

The sales tax helps fund the county government, and reduces the level of property tax.

If the sales tax drops, the county would have to raise property taxes, unless it reduces expenses.

That’s why the County Legislature voted this morning to temporarily lay off 40 employees, initially for 30 days. The Legislature may extend that in two additional 30-day increments, ending July 31. After that day, if the county is in economic distress, it could make the layoffs permanent, according to the resolution adopted this morning.

The Legislature agreed to have the county continue to pay towards the health insurance of those employees during the temporary layoff.

Welch said employees will be asked if they want to be temporarily laid off. Once the county has a list of names, Welch and department heads will meet mid-week next week to identify 40 people by the end of the week, with the layoffs to start on a new pay period beginning April 26.

Welch said the reductions will include many departments, but not the Health Department or the Sheriff’s Office.

Welch said some county employees, with unemployment and the government stimulus checks for people on unemployment, could actually see more money during the temporary layoff.

Many of the employees have been working from home, or just are at home during the shutdown. Welch said the county isn’t in a position to keep paying people to stay home and not work, especially with a state-imposed shutdown continuing through at least May 15.

Lynne Johnson, County Legislature chairwoman, said the Legislature didn’t make the action lightly.

“Our employees and families are very important not only to county operations but to our community,” she said. “This is a temporary action to help stabilize the situation. Our employees are our most valuable asset.”

Johnson said the union representing the employees agreed later this morning to the temporary layoffs.

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‘A perfect storm of financial difficulty for Orleans County’

ALBION — Orleans County legislators are looking at temporary layoffs in county government due to anticipated steep reductions in revenue.

Legislators will meet at 9:30 a.m. on Saturday to discuss the issue. They are hoping the labor unions among county employees will be a partner in a temporary layoff.

“We are trying to weigh all the factors involved here to do what’s right for our employees and the county taxpayers,” said Jack Welch, the county’s  chief administrative officer.

Welch and county legislators say the financial impact to the county from Covid-19 will be dramatic in 2020 and next year. Sales tax projections will be down at least $500,000 and perhaps much more, with state reimbursements also expected to be cut. Losses in the stock market also will likely mean higher pension contribution rates over the next several years.

“The 2 percent tax cap was made permanent in state law and tied to several state reimbursement formulas,” Welch said in a news release. “These factors come together to create a perfect storm of financial difficulty for Orleans County.”

County officials say a temporary layoff now could ease some of the damage to the county’s finances.

“This is not a course of action that we are pursuing lightly,” said Lynne Johnson, Legislature chairwoman. “Our employees and families are very important not only to county operations but to our community. This is a temporary action to help stabilize the situation. Our employees are our most valuable asset.”

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When Dean Bellack offered his services as director of United Way of Orleans County, he couldn’t have envisioned the challenge ahead with the ensuing coronavirus pandemic.

Dean Bellack

“During a hard time such as this is when charities step up to the plate,” Bellack said. “When you think of United Way you should think of human relief. We are in a time when our lives have been altered, and it is our job is to bring dollars, partnerships and help to those who need it.

Bellack referred to the Buffalo community which just raised $5 million in the past two weeks from corporate donors, philanthropic organizations and community foundations. Being able to help out in a time of crisis improves an organization’s stature and that benefits them in the future when they try to raise money, he said.

Unfortunately, as much as United Way of Orleans County would like to step up and offer assistance now, the allocations for the year have been set, and United Way needs to focus on honoring those allocations. He said the community donations to United Way were up this past year, allowing them to provide funding to all their partner agencies.

However, with the hardships placed on businesses, corporations and individuals with the coronavirus  pandemic, United Way worries whether people will be able to meet their pledges so that United Way can meet its obligations to its agencies. Because of that concern, Bellack is pursuing other funding opportunities.

Bellack’s goal is to position United Way of Orleans County to the place in people’s minds where their mindset is, “When I want to help people, I give to United Way.”

He said that not only means dollars, but also uniting agencies for that purpose, which is a process he has already begun.

The Western New York Fund just announced a connection to the United Way, and Bellack has asked for some specific assistance for food banks and soup kitchens, and the Ministry of Concern and Community Action for housing. This funding will come to Orleans County because of the United Way partnerships.

United Way of Orleans County is registered on the United Way Worldwide network and has the potential to get help from the federal bill which was just passed. The bill designates billions for charity, Bellack said.

Another source of funding which Bellack is pursuing on behalf of United Way of Orleans County is a grant from BlueCross BlueShield’s 2020 Blue Fund. The fund will consider grant requests that address at least one or more health focus areas, such as behavioral health, cardiovascular health, health-care workforce development and healthy children.

Each grant request will be between $100,000 and $300,000.

Bellack has met with the YMCA, Community Action, Ministry of Concern, Praising Kids Childcare, Iroquois Trail Council, The Arc, OCAL’s, and Cornell Cooperative Extension to invite them to join in applying for the funding. This is the first time these agencies have applied together under the United Way.

“Our community and our non-profits are uniting to change our impact,” Bellack said. “The agencies involved in this process are excited and are planning future collaborations going forward.”

“I believe that bringing these agencies together will give us a bigger impact on this and bring in more dollars to Orleans County,” Bellack said.

Bellack and the board want the community to know they are working very hard to remain visible, fulfill their commitments and provide assistance in the future.

The annual Day of Caring scheduled in May has been canceled, but will be rescheduled in the late summer or fall. As of now, the June 5 golf tournament is still a go, but may be rescheduled if necessary, as it is a major fundraiser for United Way.

Bellack’s final comment is, “United Way is neighbors helping neighbors. Please help your neighbor. Help them go to the store. Help them with a meal. Please be generous in what you can do. If you are able to donate, give where your heart leads you.”

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Press Release, Lynne Johnson, Orleans County Legislature chairwoman

ALBION – Take 5 for New York is a new county-wide campaign that is being launched to encourage Orleans County residents to take five minutes out of each day to call a friend, loved one, or acquaintance who may be alone and feeling isolated during this period of social distancing.

Lynne Johnson

It is part of a state-wide effort promoted by the New York State Association of Counties (NYSAC).

“Participating county officials are calling on their residents to take just five minutes of everyday to call on a loved one, friend, neighbor, acquaintance to say hi, check on them, see if they need anything, lift their spirits, and tell them they are not alone, “ said Stephen Acquario, NYSAC Executive Director. “It doesn’t matter what you talk about. You can talk about this crisis or the latest show you are watching. The point is connecting with people in our community who could use it the most.”

This statewide campaign is being launched with the hashtag #Take5ForNY.

The New York State Association of Counties is a bipartisan municipal association serving all the counties of New York State, including the City of New York.

Photo by Tom Rivers: The VFW Post is Medina is among the many places that serve food and alcohol that are currently closed to the public.

Orleans County could see a $1.7 million loss in sales tax revenue due the economic slowdown, according to a report from State Comptroller Tom DiNapoli.

The comptroller said county governments will take a hit in their sales tax revenues as many businesses are scaled back or shut down in response to the coronavirus.

The sales tax is used to fund many programs and also helps offset some of the burden with local property taxes.

Orleans County receives about $17 million a year in sales tax and shares $1,366,671 with the 10 towns and four villages in the county.

The comptroller has released a sales tax impact report, offering two scenarios. In a mild recession, Orleans would see a 3.4 percent reduction in sales or about $559,585. In a prolonged recession, the county would take a 10.2 percent hit or $1,704,954, according to the comptroller’s report.

State-wide, counties could see an estimated $2 billion loss in local sales tax revenues due to economic slowdown.

“These revenue forecasts are very troubling for local governments and property taxpayers,” said John F. (Jack) Marren, chairman of the Ontario County Board of Supervisors and president of the New York State Association of Counties. “Counties are on the front lines executing this public health state of emergency, while the state manages it and the federal government supports it financially. We’ve never seen anything like this, ever. Our personnel is exhausted, our resources are scarce, but our spirit to defeat this silent enemy remains strong.”

The report’s estimates do not account for the local workforce related revenue losses, and the costs associated with responding to the COVID-19 pandemic, NYSAC said.

“Every level of government is going to feel the impact of the COVID-19 crisis, and local governments are bracing for that loss of revenue,” said NYSAC Executive Director Stephen J. Acquario. “But we are also urging a partnership with the state as we confront the public health threat. We represent the same taxpayer at the local level and we have limited revenues. As the state enacts its operating budget, we ask for flexibility so that we can manage the fiscal impact locally. All units of government need a financial lifeline, and we will work with the state to rebuild the economy.”

The state also will take a huge hit with what could be a $10 billion to $15 billion revenue loss, Gov. Andrew Cuomo said.

As the state struggles fiscally, it is anticipated that significant state aid reimbursement cuts to counties and local government will follow, and those cuts could be significant, according to NYSAC.

Counties face a quadruple threat of declining local revenues, especially sales tax, but also mortgage recording taxes and hotel occupancy taxes; higher spending necessary to respond to the health emergency; the loss of state reimbursement; and the potential of significant losses for small businesses on main streets that could threaten jobs and the property tax base over the short to mid-term, NYSAC said in a report today.

“We cannot stress enough how uncertain any forecast is,” Acquario said. “The potential spread, severity, and duration of the virus are poorly understood, and expert knowledge is evolving.

“The extent and duration of lockdowns, travel restrictions, and other responses that protect public health but damage short-term economic growth have been increasing as policy makers and public health officials learn more. The stock market has been swinging wildly. Economic forecasters have been rushing to release unscheduled forecast revisions in an effort to keep up with events.”

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The U.S. Census Bureau’s latest population estimates show Orleans County has one of the largest population declines, by percentage, among the 62 counties in the state.

Orleans County had a population of 42,883 in the 2010 Census. The 2019 population estimate puts the county’s population at 40,352. That’s a drop of 2,531 people. The 5.90 percent reduction ranks 56 out of 62 counties.

Counties with a larger percentage decrease than Orleans include: 57th, Chautauqua, (-5.93%); 58th, Chemung, -6.05%); 59th, Essex, (-6.31%); 60th, Chenango, (-6.48%); 61st, Delaware, (-8.01%); and 62nd, Hamilton, (-8.68%).

The population changes for other nearby counties include:

• Genesee, 4.66 percent drop, from 60,079 to 57,280;

• Niagara, 3.32 percent drop, from 216,469 to 209,281;

• Monroe, 0.35 percent decrease, from 744,344 to 741,770;

• Erie, 0.04 percent decline, from 919,040 to 918,702;

• Livingston, 3.79 percent drop, from 65,393 to 62,914;

• Wyoming, 5.45 percent decline, from 42,155 to 39,859;

State-wide, New York’s population grew by 0.39 percent or 75,459, from 19,378,102 in 2010 to 19,453,561 to 2019.

Upstate declined by 2.00 percent or by 126,830 people, from 6,339,276 to 6,212,446. Downstate grew by 1.55 percent or 202,289 people, from 13,038,826 to 13,241,115.

The data shows that 45 of 50 upstate counties lost population since the 2010 Census. Only three downstate counties had population declines.

The Census Bureau does a population estimate every year. The latest numbers reflect a 12-month period ending last July 1.

The data shows that 50 counties in upstate New York lost 20,846 residents, a decrease of 0.33 percent, while the downstate region lost a combined total of 55,944 people, or 0.42 percent. New York City has lost population the past three years, after a long period of growth, according to analysis by the Empire Center.

International Migration

The Census Bureau also looks at international migration and domestic migration for the counties.

Orleans County added 194 people through international migration for a 0.45 percent growth rate, which ranked 42nd out of 62 counties.

Among the other GLOW counties, Genesee ranked 50th, adding 222 people at 0.37 percent rate; Wyoming was 58th, adding 82 for a 0.19 percent growth rate; and Livingston was 25th, adding 752 people for 1.15 percent rate.

Domestic Migration

Orleans had 2,654 move out, or 6.19 percent of population, the 50th highest rate among the 62 counties.

Among the GLOW counties, Genesee had 2,564 people move out, or 4.27 percent of its population which was 24th highest of the counties. Livingston had 2,841 people migrate away from the county or 4.34 percent, the 26th highest rate. Wyoming ranked 44th with a 5.75 percent migration rate with 2,424 people moving out of the county since 2010.

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