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Nassau sales tax hike called unlikely

Nassau County Executive Edward Mangano works on the

Nassau County Executive Edward Mangano works on the new budget in his office in Mineola. (Sept. 15, 2010) Photo Credit: Howard Schnapp

ALBANY - Nassau Executive Edward Mangano is quietly lobbying for a sales tax increase to help the cash-strapped county, but officials here said the required state approval was unlikely.

Mangano wants to raise Nassau's sales tax by 0.25 percent to 8.875 percent, bringing in an extra $60 million or so per year to the county's depleted coffers, according to sources in the State Legislature. The tax increase, which must be adopted by state lawmakers, would expire in two years unless reauthorized, the sources said.

Mangano, his aides and Nassau union leaders met with state senators and Assembly members during trips to the Capitol on Nov. 29 and Tuesday. In the conversations, Mangano was told a sales tax hike would not be considered this year and would be a tough sell in 2011, said three sources familiar with the talks.

"Everyone understands Nassau's finances are a mess," said one source. "But increasing the sales tax to what it is in New York City isn't palatable right now."

Mangano was unavailable for comment Friday, his spokesman said. On Nov. 29, after meeting with Sen. Dean Skelos (R-Rockville Centre), the county executive refused to say what he was asking for beyond "help for the county."

Skelos, who is expected to become Senate majority leader next month, "is personally opposed to tax increases, as are members of our conference," said press secretary Scott Reif. He added Skelos "will continue to have a dialogue with Nassau County and other municipalities around the state about what steps they believe are necessary to get themselves on more solid fiscal footing."

Assemb. David McDonough (R-Merrick) said he "sympathizes with the situation, which is not Ed's doing, but I cannot support a tax increase."

In Nassau's $2.6-billion budget, fiscal watchdogs have identified $250 million that they say may not materialize, including $60 million in union concessions and $23 million from more red-light cameras, surcharges on traffic tickets and other initiatives requiring state approval.

Mangano also intends to borrow money to pay $100 million in projected tax refunds next year, a practice that helped lead Nassau to the brink of bankruptcy in 1999.

Mangano hopes to gain approval for the sales tax increase by amending a bill from Assemb. Sandra Galef (D-Ossining) and Sen. Andrea Stewart-Cousins (D-Yonkers).

That legislation, supported by the state Association of Counties, would exempt most counties from having to get state approval every two years for their portion of the sales tax if it's more than 3 percent; now the case in 52 counties. If the measure were adopted, reauthorization would only be needed for levies above 4 percent.

The bill isn't directly related to Mangano's proposed sales tax increase, except as a vehicle to get it before lawmakers.

Of the 8.625 percent tax charged on purchases in Nassau, 4 percent goes to the state, 4.25 percent to the county and the remainder to the Metropolitan Transportation Authority. A portion of Nassau's collections goes to towns and villages.

By adding 0.25 percent, Nassau's sales tax would equal that of New York City's 8.875 percent, and be 0.25 percent higher than Suffolk's.

Stephen J. Acquario, executive director of the counties' association, added, "Ed Mangano isn't the only one looking for help. A number of counties are experiencing financial difficulties and everyone is dependent on sales tax revenue."

Local sales tax rates

New York State imposes a 4 percent sales tax on purchases and most counties tack on an additional 3 percent or more. The local sales tax rates:

NASSAU* - 8.625 percent

SUFFOLK - 8.625 percent

NYC - 8.875 percent


*8.875% under Mangano's proposed increase

NOTE: The Metropolitan Transportation Authority, towns and villages receive a portion of the county collections

SOURCE: NYS TAXATION AND FINANCE DEPARTMENT, NASSAU LEGISLATIVE BUDGET REVIEW

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