Endorses revenue sharing with towns, villages
Putnam Executive Kevin Byrne this week vetoed a sales-tax reduction passed by the county Legislature and announced a long-discussed plan to share revenue with towns and villages if the rate remains unchanged.
In a memo sent Monday (April 14) to the Legislature, Byrne called on lawmakers to convene an emergency meeting to rescind their 5-4 vote requesting the state allow Putnam to lower the county’s portion of the tax on purchases from 4 percent to 3.75 percent. The reduction would cost the county an estimated $5.3 million annually.
The higher rate has been in place since 2007, when the state enacted a law allowing Putnam to increase its sales tax from 3 percent to 4 percent. A series of extensions have kept the higher rate in place, but the most recent one expires on Nov. 30, requiring passage of another bill before state lawmakers end their 2025 session on June 12.
Consumers in Putnam County pay 8.375 percent sales tax, which includes 4 percent for the state and 0.375 percent for the Metropolitan Commuter Transportation District. With the reduction, the total tax would fall to 8.125 percent.
Preserving the rate will allow the county to continue reducing property taxes and fund capital projects, Byrne wrote in his memo.
Flanked by officials from Philipstown, Cold Spring, Nelsonville and Putnam’s other towns and villages, Byrne also announced outside Kent Town Hall on Tuesday that if county legislators renew the extra 1 percent, one-ninth of its revenue would be distributed annually to municipalities for infrastructure and capital projects.
If sales-tax sharing had been in place in 2024, Putnam would have distributed $2.4 million to the county’s six towns and three villages on a per capita basis, said Byrne during a news conference. Each would be guaranteed at least $50,000.
With the move, Putnam would join 50 of New York’s 62 counties that share sales tax revenue with their municipalities, according to the state Comptroller’s Office. Dutchess’ 2025 budget includes $46 million in sales-tax distributions, with an estimated $6.1 million for Beacon.
Extending the current rate will also help fund a $1 million reduction in the property-tax levy that Byrne says he will propose for the 2026 budget. The reduction would be the largest in county history, he said.
Addressing the Legislature on April 1, Cold Spring Mayor Kathleen Foley accused legislators of “hoarding” money because Putnam has accumulated $134 million in savings. Speaking at the news conference, Foley said the village has stormwater impacts it needs to address and that extra revenue could also help the village manage tourism.
Dan Birmingham, the legislator who initially proposed a reduction to 3.5 percent, said the size of Putnam’s savings, or fund balance, justified giving residents a break. During his first stint as a legislator, from 2004 to 2012, Birmingham supported the 2007 increase to 4 percent to cover county losses attributed to the Great Recession.
Now, Putnam is “sitting on top of the largest fund balance-to-budget ratio this county has ever seen,” he said.
When Nancy Montgomery, who represents Philipstown and part of the Putnam Valley, predicted before the April 1 vote that Byrne would veto the lower sales tax, Birmingham said that unless the Legislature has six votes to override a veto, “you return to the status quo” after Nov. 30 — the 3 percent rate that existed before 2007.
Byrne said on Tuesday that sacrificing the full 1 percent “would not help the towns; it would hurt this county” because the annual revenue loss would total about $20 million.
In 2022, the Legislature unanimously agreed to pass along sales tax that exceeded what the county collected the previous year. In what turned out to be a one-time distribution, it shared $5 million, sending $369,670 to Philipstown, $101,671 to Cold Spring and $31,945 to Nelsonville, which used its portion to study the feasibility of building a sewer system.
Nelsonville could use any new funding for engineering plans needed to get the sewer plan “shovel-ready” for construction grants, said Mayor Chris Winward. “It takes a long time to get to shovel-ready,” she said.
Thank you for covering this important story. However, you misquoted me. At the press conference on April 15, I praised my executive colleagues and the county executive for working together in a substantive way and then, at the request of the county executive, gave examples of ways the shared sales tax could benefit the Village of Cold Spring.
One was for engineering and upgrades of our aged stormwater infrastructure, necessary because the village is positioned between steep elevations and a rising river, and storms are only getting stronger with climate change. I also cited tourism management uses for the money — help we have been asking the county to give for a long time, to no avail.
I did say that the county Legislature appears to be hoarding money in its sales tax surplus, but that statement was made at the Legislature meeting on April 1, not at the press conference. While that meeting was contentious, the press conference was collegial and united, with the towns and villages speaking in a single voice. It’s time for county Legislators Birmingham, Ellner, Jonke, Addonizio and Sayegh to listen and to come on board with the rest of the elected officials in Putnam.
Foley is the mayor of Cold Spring.