Greatly aiding its effort to close a longstanding deficit in its general fund, the City has received an upfront $3 million payment connected to the recently completed sales tax agreement with Dutchess County and the City of Beacon.
The new 10-year agreement -- which governs the distribution of sales tax by the county to cities and towns -- was approved by the Poughkeepsie Common Council, the Beacon City Council, and the Dutchess County Legislature. The New York State Comptroller’s Office has now ratified the accord, freeing up the payment from the County to the City of Poughkeepsie.
The funds will further reduce the city’s general fund deficit to $2.8 million, a figure that stood at $13.2 million when Mayor Rolison took office in January of 2016.
Mayor Rob Rolison said, “Through judicious work and by means both big and small, we have been able to greatly reduce the city’s budget deficit and are working to eradicate it. I want to thank Dutchess County and City of Beacon officials for working to provide an equitable and fair distribution of sales tax revenue that will make a major difference to our communities over the next decade.”
Dutchess County Executive Marc Molinaro said, “The negotiations with the cities of Poughkeepsie and Beacon were extremely productive. The cities, towns, villages and county all needed to see a clear path regarding the sales tax formula, and we achieved that. I’m grateful to all who helped finalize this vital agreement.”
City Administrator Marc Nelson said, “The city has worked extremely hard to dig itself out of this deficit and stabilize city finances. This is the important work that will ultimately lead to a bond rating increase and will return the city’s credit rating to above investment grade. With interest rates rising sharply the city’s credit rating is the key to protecting our taxpayers from rising debt service costs.”
Under the new agreement, each of the cities will see a graduated increase in the percentage of sales tax received, with the City of Poughkeepsie increasing their percentage of sales tax collected from the current 4.59 percent to receiving 6.02 percent by 2030. The City of Beacon will go from its current 2 percent to receiving 2.62 percent by 2030. Local towns and villages will continue to share 9.5 percent of total county sales tax collected.