letter to the editor by michael russo 3-1-2013

Letter to the Editor, New Paltz Times by Michael Russo, March 1, 2013

At the February 21 Joint Town/Village Board Meeting, Dr. Gerald Benjamin stated, in response to a question by Kitty Brown, that funding for the Citizen Empowerment tax credits that would allow a consolidated government to obtain up to $1 million in state funding, has been appropriated in the State Budget.

This is accurate but one has to know that appropriations expire at the end or soon after the end of every fiscal year budget regardless of how much money was spent (NY Finance Law Sec 40.3). If the next year's budget does not renew the appropriation, the funding is gone.

The State’s fiscal year starts April 1, and the Governor's proposed budget is still being debated in the legislature. Even if the Citizen's Empowerment tax credits are approved this coming fiscal year, this is no guarantee for subsequent years.

Dr. Benjamin also stated: "The criticism on relying on state funds is the point that KT Tobin raised earlier, that the state has been unreliable about persisting in the amount of money it gives to local governments over time. But you have to act on the law as you understand it and as you expect it to unfold -- you can't say that the state lies and therefore we can't proceed, or has lied in the past and we can't proceed -- or at least I think we can't say that."

However, if the state fails to continue the availability of Citizen Empowerment tax credits in future years, it will not mean that the state has lied. State Finance Law Sec. 54p does not make any representation that the Citizen Empowerment tax credits will continue year after year, because the law includes the phrase "within the annual amounts appropriated there-for,” which means "only if in the current budget." The State would only be lying if it didn't provide the funds in a given year when the appropriation was already made. There is no guarantee in the State Law that these funds will be appropriated in future years.

If we proceed as Dr. Benjamin suggests, i.e. "to act on the law as you understand it and as you expect it to unfold", then aside from the current fiscal year and this coming year if the legislature approves the Governor's budget, it is anyone's guess as to how the future of the Citizen Empowerment tax credits will unfold.

But in terms of that guess, let’s remember that a few weeks ago in a letter to this newspaper, it was pointed out by authors Tobin, Portier and Preston that state aid to the town and village has dropped precipitously since 2008, from 9% of revenues in 2008 to 4% of revenues in 2011. And a similar decline in aid has occurred for our school district. Such cuts are being experienced in municipalities and school districts all over the state. For me, this is a powerful signal that the Citizen Empowerment tax credit incentive program has a very limited lifespan indeed.