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Long Island

Sales tax worries in Nassau, Suffolk

Suffolk County could face a sizable sales tax deficit by the end of the year if current trends continue as receipts lag projections, county officials said Friday.

In Nassau, sales taxes ticked up slightly through the first nine months of 2015 but remain nearly $43 million below budgeted projections, according to County Comptroller George Maragos. Nassau officials said they lowered their sales tax estimates midyear and now expect to end 2015 in balance.

Suffolk legislative budget analysts said tax revenue through Sept. 30 declined by 1.1 percent compared with that period last year.

The sales tax figures are far below the projected 4.87 percent growth the county included in its 2015 budget. Suffolk revised its sales tax estimates to 2.35 percent growth, but the county is still trending below those projections, officials said.

Robert Lipp, director of the Suffolk Legislature's office of budget review, said that to meet the revised 2015 sales tax projections, receipts must grow by 8.5 percent for the remainder of the year.

Deputy Suffolk County Executive Jon Schneider initially said the county could have a $20 million shortfall this year compared with the county's most recent budget estimates.

Schneider said later that county officials planned to go back to Moody's Analytics, which had made the projections, to seek updated numbers that could be higher or lower.

Schneider said Moody's had cited decreases in gasoline prices and smaller than expected auto sales.

In Nassau, sales tax revenue increased .9 percent through the end of September compared with the same period last year. Nassau originally had budgeted for a 3 percent increase in collections for 2015, and Maragos said the county could face a $42.9 million sales tax deficit if the current pace of collections continues.

"County sales tax revenues continue to be negatively affected by low employment wage gains and a shift to online shopping, often out of state," Maragos said.

Nassau adjusted its projections over the summer to 1.4 percent growth for the year -- or a total of $1.106 billion in revenue -- to account for declines in the price of gasoline and other fuels, county officials and the comptroller said.

Maragos said growth of 1 percent in sales tax revenue for the year would enable the county to come close to meeting its revised sales tax projections.

The county imposed across-the-board spending constraints and did not fill vacant positions to offset the difference between its budgeted and revised sales tax projections, said Brian Nevin, spokesman for County Executive Edward Mangano.

Eric Naughton, Nassau's deputy county executive for finance, called the $6.7 million increase year-to-date in sales tax revenue "positive news."

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