The State has approximately 639 local authorities operating outside of New York City. These authorities generally operate without many of the constraints and controls over day-to-day operations required of municipal governments. OSC audits have helped to shine a light on questionable practices from board member compensation to the selection and results of economic development projects.
IDAs are important for economic development in the State, but local officials need to improve their scrutiny over projects so that taxpayers know if their community is receiving promised jobs and economic benefits. Recent audits have found deficiencies in IDA processes for approving and monitoring projects, as well as for recouping benefits from projects that have failed to meet their goals.
Fiscal Stress Monitoring System (FSMS) has five categories of indicators: fund balance, liquidity, short-term debt, operating deficits, and fixed costs. These indicators contribute to a local government’s final classification of Significant Stress, Moderate Stress, Susceptible to Stress or No Designation.
In 2015, the number of counties exceeding the tax cap decreased substantially and only six counties exceeded the cap—a decrease of 54 percent from 2014. Among the counties that stayed within the tax levy limit in 2015, many have levied right up to the limit. Of these 51 counties, 23 levied taxes that amounted to 99 percent or more of their allowable tax levy limit. This may be due in part to the newly enacted Property Tax Freeze Credit.
In the first half of 2015, total local sales tax collections in New York State grew by only about half of the 3.0 percent growth seen in all of 2014 and nearly two thirds less than the 4.2 percent average annual growth experienced over the previous 15 years. Sales tax revenue declined in half of the regions in the State, with the sharpest decline being in the North Country, which saw a 2.5 percent drop.
Based on Consumer Price Index data, the downward trend in inflation means that local governments operating on a December 31 fiscal year end will see the inflation factor decrease to 0.73 percent, causing a significant reduction over prior years in the allowable levy growth factor, an important component of their tax cap calculation. OSC estimates that these calendar year local governments will have roughly $135.1 million less than they would have had if the factor was at 2 percent.
While trends in both new foreclosure filings and the total number of pending foreclosure cases indicate that the problem is far from resolved, there are small signs of improvement.
In September 2015, OSC released the third annual set of Fiscal Stress Monitoring System (FSMS) scores for all municipalities that have fiscal years that operate on a calendar year basis. This includes all 57 counties outside of New York City, all 932 towns in the State, 44 cities and 10 villages – a total of 1,043 municipalities. Since the FSMS now encompasses three years of data for these "calendar year" municipalities, it is possible to start to discern trends in the financial performance of these local governments.
Declining trends in the horse racing industry and an increase in gaming options have taken their toll on OTBs. With the advent of commercial casinos in the State, policymakers have an opportunity to re-examine the viability of OTBs and how they fit into State-authorized gambling.
Total local sales tax collections in New York State grew by $552 million, or 3.6 percent, from 2014 to 2015 This was stronger than the 3.0 percent increase in the prior year. New York City sales tax collections grew by 7.3 percent, or $487 million, about half of which was due to an adjustment for incorrect payments in previous years. Excluding New York City, growth in local sales tax collections was 0.7 percent, with 30 of 57 counties outside of New York City having declines in their 2015 sales tax collections.
