July 3, 2008
County Legislature Will Look at Easing Property Taxes by Lifting Sales Tax Cap on Gasoline
Is Oswego County's cap on the gasoline sales tax really helping you save money at the gas pump?
According to an in-depth analysis of gas prices across Oswego County, and in comparison to neighboring counties, the answer is 'no'!
I believe that only the oil companies are profiting from the cap, at the expense of our property taxpayers. Two years ago we passed the cap to save our taxpayers money. But, that is not happening. You and I are still paying the same or more for gas as people in places that don't have the sales tax cap. We need to immediately stop contributing to the oil companies' “record profits.” That money should instead be used to ease property taxes.
If the county lifts the cap, does that mean you will pay higher prices at the pump?
Not if Onondaga County's experience is any indication. When Onondaga lifted the cap June 1, gas prices increased, but they rose the same amount as in other cities that never had the cap. Lifting the cap made no difference.
County Administrator Phil Church, County Treasurer John Kruk, and his staff spent the past several months researching gas prices across Oswego County and in neighboring counties, and looked at several factors that affect prices. They found no evidence to suggest that the savings are being passed on to consumers.
After reviewing and discussing several pages of research and reports, the County Legislature's Finance and Personnel Committee has recommended that the Legislature rescind the cap on gasoline sales tax at its July 10 meeting. If the measure passes, it could take effect Sept. 1.
It's important to keep in mind that any amount the county collects in sales tax directly offsets the amount needed to be raised by property taxes. The cap on sales tax is only causing property taxes to be higher than they should be.
While the gas tax cap seems to have little effect on prices, it will cost taxpayers about $3 million in lost sales tax revenues this year alone. We need to re-capture that revenue stream to ease property taxes. As gas prices continue to increase, we will continue to lose revenue if we don't correct it.
Our staff looked at several factors in their research. The City of Oswego is the only locality in the county that did not adopt a cap on sales tax on gasoline. One would expect, therefore, that gas prices would be higher in Oswego than in other areas of the county. However, surveys showed that prices in the city were consistently lower than or similar to prices in surrounding areas.
Oswego County's data is consistent with data collected in surrounding counties. Of the 15 counties that originally adopted the sales tax cap, more than half have rescinded it. Although Onondaga County lifted its cap on June 1, prices in Onondaga County continue to be lower than prices in Oswego County. Albany County issued reports charging that the oil industry, not consumers, were benefiting from the gas tax cap.
The Finance and Personnel Committee discussed this issue at length and their decision was not made lightly. I respect their opinions and I appreciate their bipartisan committee support in taking this issue to the next level.
We are a rural county and many of our residents commute a distance to their jobs and to obtain groceries, medical care and other services. The increase in gas prices has hurt us more than people living and working in cities. This was certainly not the intended result when the legislature enacted the sales tax cap.
Now, more than ever, we need to do everything we can to help our property taxpayers. I assure you that we are looking closely at all the factors -- gas prices, lost sales tax revenues and property taxes -- to act in the best interest of Oswego County's residents and businesses.
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