Suffolk GOP legislator sees sales tax hike as easy fix for county's fiscal woes

While Suffolk lawmakers last week haggled endlessly whether to allow cops to defer $3.7 million in pay to shore up a tiny part of the county's budget hole, Republican Legis. Thomas Barraga raised a much bigger idea that would go a long way to ending the county's chronic fiscal woes -- a proposal no politician in Nassau or Suffolk has been willing to broach.

Raise the sales tax a quarter cent.

"It's not that complicated," said Barraga. "We need a reliable revenue source that can restore the county to financial stability. A quarter cent would generate about $70 million and get rid of these annual deficits and return us to a sound financial footing moving forward."

A longtime fiscal conservative, Barraga, 72, who just won his sixth and final term as a county lawmaker, can speak freely without concern about re-election because he is now term-limited. However, the West Islip lawmaker, who has run without an opponent in his last two races, emphasized he has raised the issue before. Some critics also question whether Barraga, whose daughter is a deputy county attorney, may be raising the idea as a trial balloon for Democratic County Executive Steve Bellone, who can often count on the GOP lawmaker's vote.

Up to now, Bellone's only solution for the ongoing fiscal stress has been an emphasis on growing the local economy through economic development and using his performance management team to look for ways to further pare government costs. Bellone after Election Day declined to comment on the issue of increasing the sales tax but didn't rule it out.

However, Barraga said there's a limit to how much more can be cut, given the county has already reduced payroll by 1,100, privatized county health clinics, and closed the former John J. Foley nursing home, which may be sold for $15 million.

Barraga also doubted that Bellone's economic development plans can come fast enough or that his performance management team can cut deep enough to find additional savings to close the $100 million to $131 million structural gap between recurring expenses and revenues and avoid gimmicks such as selling the 12-story H. Lee Dennison building -- worth only $24 million -- for $70 million in upfront cash.

If Bellone fails to take concrete steps to narrow that gap, one Wall Street bond rating agency, Standard & Poor's, has warned that Suffolk could face as many as three more bond downgradings in the next two years.

Suffolk last raised its sales tax in 2001. Combined with the state's 4 percent sales tax, the total rate for Suffolk residents is now 8.625 percent, the same as in Nassau County. That county is also staring at $81 million in risky revenue assumptions and is under fire from the Nassau Interim Finance Authority. It is unlikely that either county would seek a sales tax hike without cover from its neighbor.

Already New York City's 8.875 percent sales tax rate exceeds those on Long Island. Barraga's quarter-cent increase proposal would lift Suffolk's to match that. Four upstate municipalities have a higher rate than Long Island, at 8.75 percent.

Barraga said he sees little downside for colleagues in either county and a major positive because it will restore both counties to fiscal health. "I don't see much reaction at all because it only hits people who can afford to buy things," he said.

But others, such as Republican business lobbyist Desmond Ryan, doubted the chances of a local sales tax increase -- which needs state authorization. He said Albany lawmakers, who face re-election next year, remain jittery over the scandals that have rocked both the Senate and the Assembly.

"With so much at stake it may be very difficult to see a bill coming out of either house," he said. "When you ask is there any individual with the fortitude to say, 'I'm going to raise your taxes,' " the idea gets very dicey real quick."