Alexandria town officials concerned about loss of income source
TOWN OF ALEXANDRIA, N.Y. (WWNY) - With businesses closed, people out of work and not going anywhere, local municipalities are concerned about sales tax revenue. That’s the money they heavily rely on to make up a budget.
Sales tax revenue makes up 43 percent of the town of Alexandria's budget, but with economic activity depressed right now due to the coronavirus crisis, officials are very concerned.
“It’s a major income source for the town of Alexandria and we know it’s going to be impacted dramatically,” said Ron Thomson, deputy town supervisor.
The town gets its share of sales tax revenue from Jefferson County.
A coronavirus economic impact report from the New York State Association of Counties projects in a mild scenario Jefferson County could potentially lose $3.3 million in sales tax revenue and in a severe scenario it could lose more than $10 million.
Chair of the county Finance and Rules Committee Michael Montigelli says the county's biggest sales tax revenue sources are automobile sales, the tourism and restaurant industries and gasoline sales - all of which are hurting right now.
"People are driving less because of the self isolation, people not going to work, so fewer people are driving and they're driving fewer miles and then the price of gas is down. And since the county bases its sales tax revenue on gasoline as a percentage, the lower price means a smaller amount for the county," said Montigelli.
With a big part of its revenue in jeopardy, the town of Alexandria is trying to cut back on expenses.
Two of the town's workers have already been laid off. Road construction and maintenance may be another place where cuts are made.
"It's not fun to have to cut back, because a lot of times it means cutting jobs but it has to be done. We have to live within our means and we know that our sales tax numbers are going to be down so we need to go through some what ifs and plan now because if we wait too long, we won't be able to react," said Thomson.
The town has a special meeting later this week where officials will talk about more ways to reduce expenses.
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