Towns, villages would split sales-tax revenue
Putnam legislators on Monday (April 28) discussed a plan to share sales taxes with the county’s municipalities — including Cold Spring, Nelsonville and Philipstown — two weeks after County Executive Kevin Byrne outlined a proposal.
Members of the Audit Committee reviewed a proposal to distribute $3 million of $90 million in reserves to aid the county’s six towns and three villages. The money, allocated based on population, could be used on infrastructure and capital projects and “essential services,” but not payroll.
Legislator Toni Addonizio suggested increasing the outlay to $5 million and allotting the same amount in 2026. She referenced a charge by Cold Spring Mayor Kathleen Foley that Putnam was “hoarding” money. “We don’t want to hoard money; we want to give it out,” said Addonizio.
Putnam’s surplus, including savings allocated to expenses, hit $134 million this year, a level which Legislator Paul Jonke called “obscene.” Michael Lewis, the finance commissioner, said Monday that unspent funds from unfilled positions and inflation-driven increases in sales-tax revenue fueled the surplus.
Legislator Greg Ellner said that Putnam’s next annual audit, when released, will show another $8 million to $12 million in the surplus.
By sending some of that money to municipalities, Putnam would join 50 of the state’s 62 counties that share revenue. Dutchess, for instance, distributes 2.35 percent of sales taxes collected to Beacon, 5.41 percent to the City of Poughkeepsie and 9.5 percent to its towns and villages.
A proposal unveiled by Byrne on April 15 and endorsed by the municipalities would share one-ninth of the 1 percent of sales-tax intake, which would have amounted to about $2.3 million based on 2024 revenue. It would take effect only if the state passes a pending bill allowing Putnam to continue collecting 4 percent, which it has done since 2007 when the state permitted the county to raise its rate by 1 percent.
The 4 percent rate has been repeatedly extended but expires on Nov. 30. State lawmakers must pass another extension before the end of the current session on June 12 or the rate will revert to 3 percent. The total sales tax in Putnam is 8.375 percent, which includes 4 percent for the state and 0.375 percent for the Metropolitan Commuter Transportation District.
Legislator Nancy Montgomery, who represents Philipstown and part of Putnam Valley, said she likes Byrne’s proposal because it is based on sales-tax revenue. If the county came to a point “where we have no fund balance,” the money would not be distributed.
Montgomery, who once proposed a plan in which the municipalities would receive 50 percent of sales taxes over the amount budgeted, offered several amendments to the Audit Committee resolution: (1) that Byrne be involved in crafting the agreement, (2) that municipalities be allowed to spend on personnel “tied to short-term and public needs” and (3) that it include reporting and audit requirements.
“While I appreciate the efforts in including our municipalities in the resolution that you wrote, I think it requires a lot more,” she told her colleagues. “I really wish you would have considered my resolution.”
Foley, who was at the meeting, also expressed concerns, including that the proposal does not establish a minimum amount that municipalities would receive. Byrne’s plan guarantees each town and village at least $50,000, a commitment particularly important for Nelsonville, whose 600 residents make it the county’s smallest municipality.
Foley called for assurances that revenue-sharing would continue beyond next year, such as the long-term agreements Dutchess and other counties have in place.
Because of the surplus, the Legislature voted last month, 5-4, to ask the state to allow the county to lower its sales-tax rate to 3.75 percent, but Byrne vetoed the resolution and proponents did not have the six votes needed to override. The county executive cited the loss of an estimated $5 million in revenue from a lowered rate and found allies in a bipartisan coalition of town and village officials.
That support was noted by state Sen. Pete Harckham in legislation he introduced on April 22 to extend the 4 percent rate to Nov. 30, 2027. Matt Slater submitted a companion bill in the Assembly on April 24.
Ag Board
Before the Audit Committee met, the full Legislature approved a resolution adding Ridge Ranch in Patterson to the county Agricultural District to comply with a court order in a lawsuit filed by the livestock farm.
State Judge Victor Grossman ruled on April 16 that the Legislature in August had improperly rejected a recommendation from its Agriculture & Farmland Protection Board to add Ridge Ranch to the district, whose benefits include exempting farms from “unreasonable” local laws that might restrict operations.
Legislators based their August vote on an “erroneous” criterion established in 2007 that requires farms in the district have one of the top six of the state’s 10 classifications for soil, said Grossman. That requirement is “irrational, arbitrary and capricious” because the classifications concern crops, not livestock, he ruled.
Daniel Honovich, a veterinarian, runs Ridge Ranch with his wife, Arielle, who has a degree in animal science and teaches special education for the Mahopac school district. The couple raises and breeds Scottish Highland, Brahman Gyr and Zebu cows, along with chickens, goats, mini donkeys and rabbits. They also host tours, birthday parties, “goat yoga” and other activities.
“I would like to apologize to the Honovichs and the farmers of Putnam County,” said Montgomery, one of three legislators who supported adding Ridge Ranch and four other farms to the district. “It didn’t have to go this way.”
Elections reporting
The Audit Committee approved a request from the Board of Elections to spend $66,000 on a four-year contract with a Florida company, Enhanced Voting, that offers real-time results, including graphs and maps, for elections.
Dutchess County already uses the system, which automatically tabulates results and posts them online, said Cathy Croft, the Democratic election commissioner. “You guys will love it, I promise you,” she said.
The Putnam County Legislature is failing to listen to the people they were elected to serve. It continues to misrepresent the sales tax proposal before them by referring to it as the “Kevin Byrne proposal” — clear evidence that some legislators are playing politics.
Let’s set the record straight: This proposal was brought forward by the nine duly elected town supervisors and village mayors of Putnam County — Republicans and Democrats — who understand the critical need for sustainable revenue across our municipalities. The county executive’s only involvement was signing and advancing the proposal with a veto of the Legislature’s resolution to reduce the sales tax by a quarter of a percent. That reduction would save consumers just 2 cents on every dollar, or $25 for every $10,000 spent, a minimal benefit with serious long-term consequences.
Let us also be clear: This proposal was not drafted behind closed doors. It was not the product of a secret meeting. We openly invited the Legislature’s chair to attend a meeting at the Putnam Valley Ambulance Corps at which we met with state senators and Assembly members from both sides of the aisle to discuss the financial realities our towns and villages are facing. The chair never responded. Transparency and bipartisanship were at the core of this process — unlike the political games being played now.
The Legislature claims this proposal is “unsustainable.” In fact, if passed, it becomes state law, creating a reliable and equitable funding source. What’s truly unsustainable is the Legislature’s approach: drawing down the county’s fund balance without a responsible plan. It has publicly acknowledged the existence of millions in unknown future expenses yet still moves forward without securing the continuation of this critical 1 percent sales-tax revenue.
A $22 million loss doesn’t just threaten county operations, but it puts every town and village in financial jeopardy. Without this funding, Putnam cannot remain a viable, affordable place to live for our seniors, veterans, working families and children.
Putnam’s state representatives have done their part by acting on the home-rule request. Now it’s up to the county Legislature to act. The people of Putnam are watching and we’re asking you to do the right thing: Approve the 1 percent sales-tax extender and commit to sharing the revenue fairly with local governments.
Annabi is the Putnam Valley supervisor. This letter also was signed by Cold Spring Mayor Kathleen Foley, Nelsonville Mayor Chris Winward, Philipstown Supervisor John Van Tassel, the supervisors of Kent, Carmel, Patterson and Southeast and the mayor of Brewster.
It is so gratifying to witness County Executive Kevin Byrne and the town and village boards work together for Putnam County taxpayers. For the first time, every mayor and supervisor is unified behind a bipartisan plan to extend the 4 percent sales-tax rate and share a modest portion for roads, bridges, sidewalks and other public pro-jects.
It is my understanding that the plan resulted from a historic compromise between state, county, town and village governments to rely less on property taxes. As the former Carmel supervisor and deputy county executive, I urge the Legislature to get behind this plan.
Even if this compromise wasn’t the legislators’ first choice, it’s better than the alternative, which would do nothing and let the sales tax rate return to 3 percent, costing the county over $20 million in annual revenue and shifting the burden to property taxes. I commend our elected officials for their care and concern.