Virus will cut into tax revenue
By Holly Crocco
William Carlin Jr., Putnam County’s finance chief, said that in his 30 years on the job he has never experienced the economic turmoil that COVID-19 has wrought.
“We’re in totally uncharted territory,” he said in a recent interview.
In her budget for 2020, Putnam County Executive MaryEllen Odell estimated the county would collect $64.4 million in sales tax revenue. Carlin said the county, as of the first week of April, was $1.5 million ahead of that projection, but noted that it had not yet seen the effect of the state’s closure last month of most businesses in an effort to slow the spread of the coronavirus.
“There is generally a 30- to 60-day lag of payments to the county from New York State [which collects the tax], so we would expect to see the drop-off reflected in May,” he said.
Sales tax is Putnam County’s biggest revenue source and had been on the rise. The county took in $66.3 million in 2019 — about 5 percent more than the year before and nearly 13 percent more than in 2017.
While the administration is looking for ways to reduce spending, it is able to make its payments, including to school districts, said Carlin. Since residents can pay their school tax bills in two installments, in the spring and the fall, the county uses sales tax revenue to provide funding so districts can operate. The districts then pay the county back, he said. April payments will be made as planned.
In addition, he noted that while Moody’s Investor Service recently upgraded the county’s bond rating to Aa1, which determines how cheaply it can borrow money, that is “meaningless now” because it is unlikely anyone will want to loan municipalities money any time soon.
As finance commissioner, Carlin had to implement layoffs in 1991, deal with the economic effects of 9/11 and navigate the 2008 recession.
“That was tough,” he said. “But nothing compares to what’s happening now.”