Legislature Asks State to Authorize Mortgage Tax Increase
The Legislature, by a vote of 11-1 (Legislator Frank Proto voted no; Legislators Kathy Luz Herrera, Tyke Randall and Nathan Shinagawa were excused) voted to request state authorization to increase the county’s mortgage recording tax by .25 percent. The mortgage recording tax, an excise tax paid by the borrower upon the recording of a mortgage on real estate, would rise from .75 to 1%. Mortgage tax revenue is currently shared by the municipality in which the property is located and New York State; with authorization by the state legislature, counties are permitted to implement an additional local tax rate for general county purposes.
County Administrator Joe Mareane told legislators he is recommending the mortgage tax increase as part of a balanced approach to deal with a $4.8 million budget shortfall and as a move that would permit the County to diversify its revenue stream. The .25% increase would be expected to generate $900,000 to $1 million per year—which the administrator said would require a 2.7% tax levy increase were the revenue to be raised through the property tax. Mareane noted that about two-thirds of the state’s counties have mortgage tax of 1% or higher, with 23 of them having exercised the local option and five more preparing to seek the authorization.
Expressing concern about the impact on homebuyers and the ever-increasing impact of fees, Legislator Frank Proto said he could not support the increase in mortgage tax, without a corresponding decrease in the real estate transfer tax enacted three years ago. Tonight’s action is only the first step—once authorization is received, the legislature would have to approve specific “home rule” language, then decide whether to increase the mortgage tax.
Legislature Takes Comment on 2010 Tentative Budget
Four people offered their comments on the County’s proposed 2010 budget, at the Legislature’s public hearing on the budget, which lasted only 15 minutes. Among them was Amy Wood Gonzales, president of the Ithaca Board of Realtors, who voiced opposition to both the proposed increase in the mortgage tax and the proposed tax levy increase of nearly 4%. Gonzales said that, while she appreciates all the work that legislators have done to develop a budget in a challenging year, the taxes pose a significant burden on those who purchase or finance a home. Former Dryden legislator Mike Lane, who is expected to rejoin the Legislature next year, also spoke against the mortgage tax increase, saying that the Legislature had already decided to impose the deed transfer tax instead of an increase in the mortgage recording tax.
Ithacan Gerry Cox urged that funds be restored for the County Library, and Human Services Coalition director Kathy Schlather said she hoped that legislators could reconsider $10,000 for agencies that was first restored to, then removed from the tentative budget.
The 2010 tentative budget, as amended by the Legislature last week, contains $73.9 million in locally controlled spending, a quarter-percent decrease from the current year. It would increase the tax levy (the total amount of property tax revenue needed to balance the budget) by 3.97%. The countywide average tax rate would increase by 1.07% to $6.00 per thousand dollars assessed property value. The Legislature can further amend the budget before final passage. The adoption vote is scheduled for the Legislature’s next meeting on Tuesday, November 17, which begins at 5:30 p.m. at Legislative Chambers in the County Courthouse, 320 N. Tioga Street in Ithaca.
Citizens are encouraged to submit their budget comments online, either through the County’s web site at www.tompkins-co.org (click on “County Budget”) or through the county budget Facebook page, which also may be accessed through the county website budget page. Citizens are encouraged to call the Legislature Office, if needed, at 274-5434 to obtain contact information for their county Legislator. There will be another opportunity to comment on the budget at the beginning of the Legislature’s November 17 meeting.
Telephone Landline Surcharge Increased
The Legislature, by a vote of 11-2, approved a new local law which amends county code to increase the access surcharge for landline telephones in the county by .65 per line to support operation and maintenance of the County’s public safety communications system. (Legislators Carol Chock and Leslyn McBean-Clairborne voted no; Legislators Kathy Luz Herrera and Tyke Randall were excused.)
The new law revises a 16-year-old local law to increase the access surcharge from .35 to $1.00 per line, as permitted by enabling state legislation approved earlier this year. The increase is projected to generate $250,000 in annual revenue to support the communications system—revenue that Legislators Jim Dennis and Mike Hattery pointed out is needed to replace state funding of $400,000 per year through the Statewide Wireless System which was promised, then withdrawn. Director of Emergency Response Lee Shurtleff told legislators he believes chances are strong to gain state support at some point, but is unsure when that will happen considering the state’s budget challenges.
Legislator Carol Chock said she cannot support the surcharge, calling it an inequitable charge that will put the burden on those citizens who can least afford it. Under terms of the enabling state legislation, the increased surcharge will sunset in ten years.
Among other actions, the Legislature