Monticello, NY – With the Sullivan County Legislature discussing a sale of or layoffs at the Care Center at Sunset Lake, plus other layoffs looming, County Manager Joshua Potosek has issued a plea for the region’s Congressional leaders to swiftly provide Federal aid.
“While our communities may outwardly look normal, this is a disaster of major proportions, and I can assure you that Sullivan County and its component municipalities have not dodged the fiscal fallout,” Potosek wrote on July 31 to Senators Chuck Schumer and Kirsten Gillibrand, along with Congressman Antonio Delgado. “We estimate that we’re facing a $10-$20 million shortfall in our $233 million 2020 budget, to say nothing of the grim prospects for 2021. While that may seem a small sum compared to other municipalities in your districts, it represents an incredible challenge for our rural County and our already overburdened taxpayers. My office and the Sullivan County Legislature are endeavoring to avoid a property tax hike by any means possible – including assessing an energy tax, exploring the sale of our nursing home, and, unfortunately, layoffs of up to 10% of our workforce.”
The ongoing closures of both The Kartrite Resort & Indoor Waterpark and the Resorts World Catskills Casino Resort have already contributed to over a million dollars in lost sales and room tax revenues, prompting letters from Potosek to Governor Andrew Cuomo to permit safely limited reopenings of both properties.
“Resorts World Catskills’ continuing closure is estimated to cost us $1.3-$2.1 million this year, and I’m sure an even greater amount with the State,” Potosek wrote this week to the Governor. “Thus I am writing to you to request timely guidance that would allow casino resorts like Resorts World Catskills to reopen at appropriate capacities in Phase 4 areas of New York State.”
Potosek on July 30 presented a grim fiscal outlook to legislators, noting that:
- Jobless claims are four times higher than the worst depths of the Great Recession in 2008-09
- Federal unemployment payments have soared past the $26 billion mark, far exceeding the $4 billion peak during the Great Recession
- The national unemployment rate is expected to hit 16% this year
- Sales tax payments did not fully recover from the Great Recession for seven years, with a possible repeat scenario for the COVID pandemic (assuming the virus is brought under control within the next few months)
“I know the State showed Sullivan County seeing a 3.3% increase in sales tax revenue year over year in July, but that’s misleading,” Sullivan County Treasurer Nancy Buck explained. “Last year at this time, the State ‘clawed back’ over $2 million of our sales tax revenue due to ‘adjustments’ from the prior year, and so the increase this year is still far less than where we need to be. In fact, we’re already a million dollars below where we were two years ago, before the casino and waterpark opened, and we certainly aren’t collecting taxes on their room and food sales at the moment.”
If Federal aid does not come through later this year, Potosek expects a minimum (and permanent) 20% across-the-board cut to the County’s State aid, deepening the already growing deficit. According to a report just issued by the NYS Association of Counties (https://www.nysac.org/files/County%20Economic%20Update%20-%207_24_20.pdf), losses could approach $30 million in Sullivan County by 2021.
“Realizing where we were last year and where we are now is stunning,” Potosek related. “The local, State and national economies were humming in 2019, but the arrival of coronavirus in 2020 completely obliterated that progress. And now we’re looking at an extended period of desperately difficult finances, even if we ultimately get a handle on COVID itself.”
“Congress needs to act now,” urged Buck, “and make sure the aid comes directly to municipalities. If it gets funneled through the State, we may not see any of it.”