Current Allegany County budget may be hiked by an additional $16 million

Allegany County legislators appear poised to overspend this year’s general fund budget by $16 million due to a windfall surplus from 2022 rather than using it for property tax relief.

Board Chairman W. Brooke Harris of Alfred told the few people attending last night’s District V legislators meeting at the Town of Allen that the excess surplus, in addition to some $30 million the county will continue to carry under next year’s tentative county operating budget, will be used to pay adjustments to year-end expenditures.

Deputy Budget Officer Terri Ross confirmed last week to Allegany Hope Community News that the county has no specific plans at this point for the $16 million in funds, to be diverted from a more than $46 million surplus the county was holding at the end of last year. That surplus is nearly 53 percent greater than this year’s entire county property tax levy.

Chairman objects to news report
Harris took issue with our report last week about the $16 million, when Casey Jones, president and executive director of Allegany Hope, umbrella to its Community News project, asked last night what the county was going to do with the money and why it wasn’t returning it to county residents in the form of tax relief.

The legislator alleged that the Allegany Hope news report about next year’s tentative budget was false because the money would be used to pay year-end bills.

Ross, however, responding last week to a query made by Allegany Hope to County Budget Officer and Administrator Carissa Knapp, said she doesn’t have “an actual list of the components (related to the $16 million). I just look at what is out there and not completed or not appropriated yet and try to come up with the amount of our budget that is left to spend for 2023.

“It really is just an estimate of our potential spending – there are several ARPA (federal pandemic American Rescue Plan Act) projects that will be presented within the month that will (be) allocated for 2023 that have not even come forward yet,” she said.

Indecision on expenditure sources
Recent county discussions have indicated indecision in regard to a multitude of unbudgeted projects which are or may be under some type of consideration and the number of places where the county has money to pay for them.

Financial resources include an unallocated amount from some $9 million received in ARPA funds; the $46 million in general fund balance at the end of last year; $1.25 million in a 2023 budgeted contingency account, of which nearly $1 million remained at the end of last month; and unexpended funds at the end of this year’s budget cycle, including excess revenues, such as from sales tax which in 10 months already has received more than 95 percent of the current year’s $25.5 million budgeted estimate. Through October, it had received over $2 million, or 9.2 percent, more than during the same period last year.

Legislator Kevin (Fred) Demick of Angelica, who also is vice-chair of the county board, told lawmakers earlier this month that he believes the group needs to better understand the current status of the ARPA funds, with those monies having to be allocated by the end of next year and spent by the end of 2026.

Ross further noted to Allegany Hope last week that the $16 million is “based on our outstanding projects including capital projects, ARPA projects and general operating cost, contract liabilities etc.

“We have many things started that could extend into the next year.

More unbudgeted projects than previous years
“In the past we have not had as many project(s) on our plate as in previous years that are not completed (and) could require commitments of fund(s) from the 2023 budget,” she said.

Harris had been copied on the deputy budget officer’s responses, which confirmed that originally unbudgeted items are being considered for expenditure as part of the $16 million in partial surplus funds.

This is the second year, if the $16 million is re-directed, that county lawmakers will have diverted an escalating surplus, rather than using it for tax relief.

Two years ago, when unexpected surplus excesses occurred, the board moved $7.5 million, again with no specific expenditures plan in place, to a fund for future economic development projects.

Second year of diversions
Ross confirmed to Allegany Hope that only $540,000 of that fund has been allocated over the past two years, with $450,000 being appropriated in January to the Allegany County Industrial Development Agency for construction of the base for a new County Road 51 at the Crossroads Development, north of Belmont, to serve a new motel which might be constructed at some point on that site.

Construction is pending finalization of environmental quality reviews.

Another $90,000 was appropriated in March for an economic development study to determine what the county should being doing to encourage such economic development activities.

Harris also emphasized at different times at last night’s meeting that next year’s tentative budget is showing a county tax rate decrease, with Jones pointing out, however, that rates actually will increase next year in 11 out of 29 towns which have lower equalization rates.

Only five towns, as we previously reported, will achieve a tax reduction equal to or above the county-wide amount, with these primarily due to revaluations which took place during the past year.

Allegany County among top taxers
Allegany County is expected to continue its ranking as having the second highest property tax rate in New York State and the third highest general sales tax among all counties.

As we reported earlier this year, two national companies focused on property tax data and real estate investments, found that Allegany County, in 2020, was second, and in 2021 was third or tied for second for having the highest overall effective property tax rate in the entire nation.

Their calculations were based on median overall property taxes paid to all county taxing entities, divided by median home values.