BILL NUMBER: S2669

SPONSOR: MAYER
 
TITLE OF BILL:

An act to amend the tax law, in relation to extending the period during
which the city of White Plains is authorized to impose an additional
sales and compensating use tax

 
PURPOSE:

Authorizes the imposition for an additional two years of an additional
one-half of one percent, an additional one-quarter of one percent and an
additional one-quarter of one percent rate of sales and compensating use
tax by the city of White Plains, for the period ending August thirty
first, two thousand twenty one.

 
SUMMARY OF PROVISIONS:

Section 1 amends clause 3 of subparagraph (ii) of the opening paragraph
of section 1210 of the tax law, as amended by chapter 28 of the laws of
              

2017, by further authorizing the city of White Plains to impose the
specified taxes at a rate which is (1) one-half of one percent addi-
tional to the three percent rate authorized in this paragraph for such
city for an additional two year period ending August 31, 2021 and (ii)an
additional one-quarter of one percent in addition to the other rates
authorized in this paragraph for such city for an additional two year
period ending August 31, 2021; and (iii) an additional one-quarter of
one percent in addition to the other rates authorized in this paragraph
for such city for the period ending August 31, 2021.

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 pre-emption. 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, 2021. This bill also extends through August 31, 2021
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, 2018, sales and use taxes amounted to $50.1 million, inclusive
of the amount restricted for tax stabilization, (31% of $164 million in
total revenues) compared to $61.9 million (38% 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 $5.1 million of restricted revenue each fiscal year. The
city prudently applied $5.1 million from this fund to the adopted budget
for the fiscal year ending June 30, 2019, which had the effect of lower-
ing the required property tax rate increase from 8.7% to 2.9%. Without
the sales tax revenue generated from the half percent authorized since
1993 and the quarter percent authorized since 1993, and the quarter
percent authorized since 2008, the city would lose an estimated $15
million in sales tax revenue each year in addition to the $5 million
earned for its contingency and tax stabilization fund.

The sales tax is critical for the City to remain within the tax cap.

 
BILL HISTORY:

A.2930/S.2961 of 2017-18 (enacted in 2017)
A.222/S.723 of 2015-16 (enacted in 2015)
A.3883 /S.3406 of 2013-14 (enacted in 2013)
A.6105/S.3796 of 2011-12 (enacted in 2011)
A.9966A/S.6868-A of 2009-10 (enacted in 2010)
A.3129/S.1087 of 2009-10 (enacted in 2009)

 
FISCAL IMPLICATIONS:

None to the State.

 
EFFECTIVE DATE:
Immediately.