Report finds LI sales tax revenue growing slowly

In another sign Long Island's economy continues to struggle, local sales-tax revenue here grew at a slower rate last year than elsewhere in New York State, according to a state comptroller's report released Tuesday.

The amount of sales tax collected by Nassau and Suffolk counties -- a critical funding source for their governments -- grew by 2.4 percent, while local sales-tax collections across the state rose by 5 percent between 2010 and 2011, Comptroller Thomas DiNapoli said.

Contrasting Long Island's slow growth, New York City marked a 6.1 percent increase.

Local economists and analysts were not surprised by the showing.

"Part of the problem is that we're losing jobs on Long Island when other areas in the state are gaining jobs," said Pearl Kamer, chief economist for the Long Island Association business group. "When you combine the weak labor market and weak housing market and the general loss of purchasing power, it's reasonable to expect that consumer spending as indicated by sales-tax revenues will also be weak."

But Marshal Cohen, chief retail analyst for The NPD Group in Port Washington, said Long Island is one of the wealthier areas of the state: "The more stable you are, the less you're going to fluctuate up and down."

The report said Nassau County's sales-tax revenue increased 1.8 percent to $1.03 billion in 2011. "Poor sales-tax receipts further highlight the stagnant economy and the reason I have held the line on property taxes for two consecutive years," said Nassau County Executive Edward Mangano.

The specifics of Nassau's sales-tax performance are in dispute. The county legislature's budget review office reported higher growth in sales-tax collections than the comptroller did: 3.6 percent. DiNapoli spokesman Mark Johnson said the state and Nassau appear to have used different sales-tax definitions.

Nassau officials forecast a 3 percent increase in sales-tax revenue when crafting the 2011 budget, so their projection was surpassed, budget officials said.

Suffolk County's sales-tax collections rose 2.9 percent to $1.16 billion in 2011. However, that fell short of the amount the previous administration budgeted by $7 million, said a spokeswoman for the Suffolk County executive's office.

County Executive Steve Bellone has assembled a panel to analyze the 2011, 2012 and 2013 budgets put together by former County Executive Steve Levy.

DiNapoli said sales-tax collections over the past two years have recovered from the nearly 6 percent decline in 2009. "New York's economy has improved over the past two years," he said, "but growth has been sluggish and unevenly distributed."

LI vs. state in sales-tax revenue

Percentage change in local sales-tax collections, 2010 to 2011

LONG ISLAND: UP 2.4 PERCENT

Binghamton area: up 8.6 percent

New York City: up 6.1 percent

Albany area: up 5.9 percent

Finger Lakes: up 5.4 percent

Syracuse area: up 4.8 percent

Buffalo area: up 4.4 percent

Source: NYS comptroller's report