City will share revenue with county
The Beacon City Council on Tuesday (Feb. 22) approved a new sales tax-sharing agreement with Dutchess County.
The 10-year agreement begins on March 1, 2023. Beacon will receive 2.35 percent of sales tax revenue collected through February 2026, 2.45 percent from 2026 to 2029 and 2.62 percent for the final three years of the deal.
The county collects a 3.75 percent tax on eligible products and services, while the state adds 4 percent.
While state law allows cities to impose sales tax in addition to the state and county taxes, Beacon Mayor Lee Kyriacou, who negotiated the agreement, said that most cities in the Mid-Hudson region instead elect to share revenue with the county.
“The communities that work together, counties and cities, usually end up in a situation where the city is doing better than they would on their own,” he said.
It’s estimated that the agreement could net Beacon an extra $1 million in revenue in the first year and as much as $3 million annually by the end of the term.
Although the unanimous vote to accept the agreement came near the end of a nearly four-hour council meeting, City Administrator Chris White on Wednesday called it “one of the most significant things” that the council will do during its current two-year term.
“This will allow the city to make critical new investments in our infrastructure and community facilities without tapping into our fund balance,” as the city has done in recent years to balance its budget, White said.