December 8, 2021

Sales-tax revenue gets a lift

County sees $450,000 increase in first six months of this year

Todd R. McAdam/managing editor

Don Willoughby of Lansing torques the nut of a car’s oil pan Tuesday at Royal Nissan Subaru on Route 281 in Cortlandville. Car sales are a large driver behind an increase in sales tax revenue in Cortland County.

With people buying more so far this year, and Cortland County taking a larger share of sales tax revenue, the county government has $450,000 more than it had last year at this time.

Shoppers in Cortland County contributed $15.01 million in sales tax revenue for the county and its municipalities in the first six months of 2019, up from $$14.55 million for the first half of 2018, county data show.

Of that, the county kept $8.45 million, and divided the rest among municipalities: $2.53 million to the city of Cortland and $4.03 million to the towns in the first two quarters of the year. A year earlier, the county kept $7.86 million, sent $4.16 million to the towns and $2.54 million to the city.

These changes come after the county entered a 10-year sales tax agreement from Jan. 1 to Dec. 21, 2028. The county takes $1.5 million off the top each year in sales tax revenue, keeps 54% of the remainder and sends 17.75% to the city and 28.25% to the other municipalities.

If the city and county continues the agreement for the final five years, the county would continue to take $1.5 million off the top.

The county then would get 55% of the remaining sales tax distribution, the city 17.38% and towns and villages 27.62%.

In the previous agreement, the county kept $300,000 a year off the top for its emergency communication system, took 53.5% of the sales tax distribution, when the city got 17.62% and the towns and villages got 28.89%.

One of the largest components driving sales tax revenue is automobile sales.

“That has been the biggest generator in the past,” said Eric Mulvihill, the clerk of the Legislature.

Jeromy Bushey agrees.

Sales at Royal Nissan Subaru on Route 281 in Cortlandville have sped up since the dealership moved there in the spring — a lot, the dealership’s operations director said Tuesday.

“Ever since we moved into our new building, sales in all sections have almost doubled,” he said. It tripled in the service department.

Sales tax for car sales goes to the county where the car is registered, not the county where it’s sold, so an increase in auto sales may mean more money going to a number of counties.

“Now, I have inventory,” Bushey said, because the move gave the dealership more space. “No matter how much I wanted from the factory, I had no place to put it.”

However, the most direct benefit to the county comes in service, because all sales tax paid in that department goes to Cortland County.

The larger department means faster response times to schedule vehicles for maintenance, he said. So some customers who might have taken their vehicles to other counties stay in Cortland.