The New York State Association of Counties (NYSAC) released a new report suggesting that the COVID-19 pandemic could have a $1 billion economic impact on counties across the state. The report can be found here: Coronavirus Economic Impact: County Sales Tax Revenue Projections.
The report comes one day after new revenue forecasts announced by New York State Comptroller Thomas DiNapoli predict that the economic slowdown caused by COVID-19 pandemic will cost New York State between $4 and $7 billion in revenues for the next fiscal year that starts on April 1st.
“These revenue forecasts are very troubling for local governments and property taxpayers,” said NYSAC President John F. (Jack) Marren. “Local taxpayers will face challenges on four separate fronts at a time when we are fighting the coronavirus outbreak. The first will be an increased demand for health and human services during a recession, the second is a loss in critical local sales tax revenues we use to fund state and local services delivered in our community, the third will come in the form of looming cuts from the state budget, and the fourth will be further reductions in local quality of life services.”
NYSAC’s report covers two economic impact scenarios: one with a mild recession and a quick recovery, and the second assumes a more severe and prolonged recession. The range of impact moves from a $350 million loss in local sales tax revenue to more than $1 billion, respectively. The report’s estimates do not account for the local workforce-related revenue losses and the costs associated with responding to the COVID-19 pandemic.
The Comptroller’s estimates also cover a mild to severe recession. Those estimates are also before the consideration of any federal stimulus that may be forthcoming which could provide significant help to the economy and state receipts, such as an increase in federal Medicaid matching funds which would directly benefit the State Financial Plan.
“Our county leaders understand that all levels of government and all facets of society will be severely impacted by the response to COVID-19, but we also believe that the state and the federal government needs to invest in our communities because we are on the front lines of fighting the spread of the coronavirus, and helping the people most impacted by an economic downturn,” said NYSAC Executive Director Stephen J. Acquario.
“Counties are concerned that this fluctuation in projected revenue could result in cuts to state aid that help to fund vital services such as public health, services for older Americans, and public safety operations such as 9-1-1 dispatch services and sheriff road patrol,” said President Marren. “Any reduction in state assistance during this emergency public health response will compound the negative revenue outlook that counties are facing.”
The New York State Association of Counties is a bipartisan municipal association serving all the counties of New York State, including the City of New York. Organized in 1925, NYSAC’s mission is to represent, educate, serve and advocate for member counties and the elected and appointed county officials who serve the public. For more information, visit www.nysac.org