Sales tax revenues rise in Suffolk, Nassau in 2016

Suffolk and Nassau ended 2016 with slight boosts in sales taxes thanks to a strong final three months of the year.

The final state sales tax checks for the year, received Friday, drove Suffolk collections up 1.76 percent compared with 2015, $7.9 million more than budgeted. Nassau’s sales tax revenue were up 2.3 percent — exceeding the 2016 budget by $11.9 million.

The Nassau legislature’s budget review office cited a “robust housing market,” particularly in refinancings, as the primary economic driver last year.

County Comptroller George Maragos credited conservative budgeting by the county for the sales tax surplus, but worried about consumers’ changing shopping habits in the future. “Sales tax revenues appear to have exceeded overall economic growth for the first time in years, but uncertainty will persist with the shift to online shopping and reduced mall traffic.”

Fourth-quarter sales tax collections were up 4.16 percent in 2016 over the same quarter in 2015 — higher than any other three-month period, including a negative growth rate from April through June.

Suffolk sales tax grew just 0.2 percent in the first half of 2016 and 3 percent in the second half, according to the county legislature’s nonpartisan Budget Review Office.

Suffolk County officials said the higher-than-expected fourth quarter was attributed to an “excellent” holiday season.

“It is certainly a positive sign, both for our budget as well as the strength of our local economy,” Deputy County Executive Jon Schneider said.

Suffolk’s 1.76 percent increase is the largest growth since 2013, when post-Sandy reconstruction boosted spending on Long Island. “This will help patch up the budget, but we need to continue to do the tough things to put Suffolk County to fiscal stability,” Schneider said.

Suffolk still faces an ongoing deficit of at least $137 million, according to the budget review office.

“There’s nothing to be ringing the bell about,” Legis. Kevin McCaffrey (R-Lindenhurst) said. “It’s not bad news, it’s good news. But it isn’t our savior.”

Sales tax is county governments’ largest source of revenue, accounting for about 40 percent of budgeted revenues.

Nassau collected a total $1,129.6 million in sales tax revenue in 2016, compared with $1,103.8 million in 2015.

Suffolk collected $1,334.8 million in sales tax revenue in 2016, compared with $1,311.753 in 2015.

Analysts say sales tax revenue this year in Nassau needs to grow 1.1 percent to meet budget projections. In Suffolk it needs to grow 1.4 percent.

By David M. Schwartz

dschwar1@newsday.com,celeste.hadrick@newsday.comschwartznewsNY,

David Schwartz covers environmental issues. A native Long Islander, he's worked at Newsday since 2013.