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For Sullivan County, our own fiscal cliff

December 6, 2012

Sullivan County property owners face the likelihood that the county legislature will pass a 2013 budget with a double-digit tax hike. In these tough economic times, putting this burden on already financially strapped citizens seems just plain wrong. Legislators know that a 13.7% tax increase will be quite painful for many taxpayers, yet few other options appear. (The county manager has suggested that to fill the budget gap, the legislature should consider privatizing some county services, not automatically filling vacant job positions and cutting some capital expenditures, but the proposed 2013 budget includes no lay-offs or cuts in services.)

So, how we did we get to this point?

For too many years, past Sullivan County legislatures have failed to make the courageous decisions necessary to produce fiscally honest county budgets; Albany has failed to provide meaningful relief from spending to fulfill mandated state and federal programs, which Albany and Washington, DC do not fully fund; and all the while, the cost of government services continues to rise.

Just to refresh everyone’s memory:

Two years ago, the legislature produced a 2011 budget with no tax increases, no cuts in county services and no layoffs of county employees. It was based on a wing and a prayer that union employees would voluntarily agree to give-backs. This was just plain wishful thinking, and it didn’t work.

Then Albany passed a law establishing a two-percent cap on property tax increases. (More wishful thinking! With rising costs outpacing revenues by more than two percent, what good is an arbitrary cap?) Last year, although they could have asked for an exemption, legislators decided to comply with the new two-percent tax cap and, electing not to raise taxes, proceeded to raid the county’s reserve fund, taking more than $6 million to balance the 2012 budget.

This year there is not enough money left in the reserve fund to work that magic again. The county’s bill for employee pensions (up more than $4 million this year) and employee health insurance (up $1.8 million), leaves the taxpayer holding the bag. And that’s not even the entire bill.