Authorizes the city of White Plains to impose an additional one-quarter of one percent sales and compensating use tax

Section 2 provides that notwithstanding the provisions of subdivision (d) of section 1210 of the tax law or any other provision of law to the contrary, a local law enacted or amended pursuant to the authority of this act, imposing an additional rate of tax in the city of White Plains shall become effective in accordance with the provisions of subdivision (d) of section 1210 of the tax law, except that the certified copy of such local law must be mailed by certified or registered mail at least twenty-one days prior to the date on which such local law is to take effect.

Section 3 requires the city of White Plains to pay the estimated revenue from the additional one quarter of one percent rate of sales tax first authorized by chapter seventy-four of the laws of two thousand ten into the city's contingency and tax stabilization reserve fund, subject to all the limitations and other provisions of section 6-e of the general municipal law.

Justification

Since 1993, the State has authorized the city of White Plains to impose an additional one-half of one percent rate of sales tax to replace revenues lost through local preemption. Since 2008, the State has approved an additional one quarter of one percent rate of sales tax bringing the city of White Plains sales tax rate to two and a quarter percent. Since 2010, legislation has been enacted to permit the city of White Plains to impose an additional one quarter of one percent rate of sales tax and to require the city to pay the proceeds of the rate increase into a contingency and tax stabilization reserve fund, under section 6-e of the general municipal law.

This bill will permit the city of White Plains to continue to impose each of these additional tax rates through August 31, 2017. This bill also extends through August 31, 2017 the requirement that the city pay the proceeds of the rate increase first authorized by chapter seventy-four of the laws of 2010 into the contingency and tax stabilization reserve fund of such city, subject to all the limitations and other provisions of section 6-e of the general municipal law. This bill will not affect the sales tax revenue of the State of New York or the County of Westchester.

Sales and use taxes are a significant source of revenue for the city. In the fiscal year ended June 30,2014, sales and use taxes amounted to $51.9 million, inclusive of the amount restricted for tax stabilization, (34% of $152.6 million in total revenues) compared to $51.1 million (33% of total revenues) collected from property taxes and related items (Pilots', interest and penalties, etc.). The additional one-quarter of one percent rate of tax first authorized by chapter seventy-four of the laws of 2010 generates approximately $5 million of restricted revenue each fiscal year. The city prudently applied $5 million from this fund to the adopted budget for the fiscal year ending June 30, 2015, which had the effect of lowering the required property tax rate increase from 11.7% to 2.3%. Without the sales tax revenue generated from the half per cent authorized since 1993 and the quarter percent authorized since 2008, the city would lose an estimated $15.5 million in sales tax revenue each year in addition to the $5 million earned for its contingency and tax stabilization fund.

Legislative history

A.6105/S.3796 of 2011(enacted in 2011); A.9966A/S.6868-A of 2009-2010 (enacted in 2010); A.3129/S.1087 of 2009-2010 (enacted in 2009); A.6105/S.3796 of 2011-2012 (enacted in 2011); A.3883/S.3406 of 2013-14 (enacted in 2013)

Fiscal state implications

None to the State.

Fiscal local implications

To be determined.

Effective date

This act shall take effect immediately and shall expire and be deemed repealed on August thirty-first, two thousand seventeen.