Ogdensburg weighs sales tax issue

Mayor Jeffrey M. Skelly and City Manager Stephen P. Jellie were hoping to get the extension so they would have time to either come to a better long-term deal with the county, or have enough time to withdraw from the agreement altogether and collect sales tax on their own.

The latter choice is about the leverage the city has in its negotiations.

There is one hitch — if the city collects its own sales tax or pre-empts, no one knows for sure what it will mean in terms of money for either side.

Mr. Jellie said he had not been able to obtain data on sales tax collection broken down below the county level.

Mayor Skelly said recently, while he “feels good” about the city collecting as much or more sales tax than it does in the county agreement, he has no hard numbers to back that up.

St. Lawrence County Treasurer Renee M. Cole said hard numbers are difficult to come by because they don’t exist.

The state, for the most part, collects taxes by county. The exception would be in counties where cities already pre-empt taxes.

The sales tax goes to the state simply as money from St. Lawrence County.

“The example I like to give is Walmart,” Ms. Cole said.

The sales tax paid for a waffle iron bought in Walmart in Ogdensburg, goes to the state as a tax paid at Walmart in St. Lawrence County. It could have come from any one of the big retailer’s three stores in the county — Potsdam, Massena or Ogdensburg. Walmart does not pay three state sales tax bills; it pays one, she said.

Also complicating attempts to predict sales within the city limits, Ms. Cole, said is the collection of sales tax for online purchases.

Comparisons of historic sales tax records shows that the ratio between the city’s share and the county’s collection has remained close.

In 2000, the last year Ogdensburg collected sales tax, the city received $1,779,208. In 2019, the city collected $3,964,895 as its share of St. Lawrence County’s payout, or a 122.85% increase.

The county collected $28,134,198 in 2000, and $62,192,015 in 2019 for a 121.05% increase.

During the same period, population in Ogdensburg and St. Lawrence County decreased.

Ogdensburg went from 12,364 residents in 2000 to 10,436 in 2019, a 15.6% decrease, while the county went from 111,961 to 107,740 residents, or a 3.75% decrease.

Unless the agreement comes up again and the city gets its three-year extension, City Council will have very little time — just until November — to either craft a new deal or start collecting its own sales tax.

Under the existing agreement, the city receives 6.64% of the last 1% sales tax received by the county, and the towns and villages receive a different share using a formula based on their assessed value and population.

“I think there’s way too many questions as to how this is going to get distributed. That’s the sticking point that I’m seeing right there,” county Board of Legislators Chairman Joseph R. Lightfoot, R-Ogdensburg, said.

The resolution could be taken back up at the Finance Committee meeting in January. If approved then, it would also be subject to a full board vote and similar agreement from the city, which indicated it would be in favor at a special board meeting earlier in December.