And then there was one.
The Pembroke Town Board on Thursday night voted, 5-0, to sign an amended water supply agreement with Genesee County, leaving the Town of Darien as the lone municipality not to opt in to a contract that would set the stage for $10 million in sales tax distribution from the county to its towns and villages over the next 38 years.
“We felt that it was more important to secure sales tax funding than to hold out on the water agreement,” Pembroke Town Supervisor Thomas Schneider Jr. said. “In good faith, we believed that it was best to mend some fences with the county.”
In a previous story on The Batavian, Schneider indicated there were some hard feelings over the way water agreements were handled in the past, but the current board is willing to give county leaders the benefit of the doubt – believing that the legislature will attain its goal of equalizing the water surcharge.
Schneider also said he talked to County Manager Matt Landers about the potential of “bumping up” the guaranteed sales tax money to be shared with the municipalities in light of the Village of Corfu (at the end of July) and Town of Pembroke opting in.
PEMBROKE MAKES COUNTEROFFER
“Hopefully, we are thinking that the $7 million in sales tax distribution could go to maybe eight or eight and a half million – based on having Corfu and Pembroke on board.”
Genesee County’s offer to distribute $10 million in straight sales tax revenue is contingent upon universal buy-in from its towns and villages.
Without that universal buy-in, the proposal is to distribute $7 million in annual sales tax revenue and an additional $3 million in other revenue on a periodic basis over the next 38 years.
Municipalities not opting in would receive less in revenue distribution than expected to allow for the equalization of water surcharge revenue.
Legislature Chair Rochelle Stein was asked if lawmakers would consider Schneider’s proposal to increase the guaranteed sales tax distribution.
Choosing her words carefully, she replied, “Here’s what I’m going to say: Let us do our work.”
“We have not met and we won’t until Monday. So, there’s a process that we follow and let us do our work. But, certainly, that suggestion is taken and welcomed.”
FIXING UNBALANCED TAX RATES
Currently, the county’s revenue sharing process has created a situation, per state law, where towns with villages inside them have to keep two separate books and have two separate tax rates – an A fund for townwide sales tax that affects everyone and a B fund for sales tax that only affects the services of taxpayers outside the village.
Stein said the legislature’s focus has been “to be able to direct that revenue sharing into the B funds of those towns and villages; that is our focus for this entire process. And, if we can find a way to get there together, that’s our goal.”
She previously explained that the $10 million figure that the county is committed to putting into the sales tax agreement would fix the unbalanced A and B tax rate.
When asked if she thought the Darien Town Board would change is mind and opt in, Stein said she that if it did reconsider, it would need to be mindful that the county has a timetable to adhere to “that is significant because our calendar has already started.”
The legislature’s Ways & Means Committee is expected to address the situation at its meeting this Monday, with the full legislature scheduled to vote on a distribution amount on Aug. 25.
“Plus, the City of Batavia has to do this at their meetings in September and the (New York State) Office of Comptroller needs 60 to 90 days and we already want to be able to distribute our third quarter payments (in October) as sales tax,” Stein advised.
“Time is not our friend right now,” she said. “But for those six towns that have the B funds or that have villages in their towns, it is truly meaningful for their more rural taxpayers to rebalance that property tax imbalance that is occurring right now for them.”
PURSUING WATER RATE EQUALIZATION
Landers said he was “happy” to learn that Pembroke passed the resolution.
“I know that they will be hopeful that the county as a whole, not just Genesee County but the towns, will remember this 5-0 vote when it comes time for the equalization of the retail water rate charged by the Monroe County Water Authority,” he said.
“The county can recommend an equalized retail rate and, again, I’m certain that Pembroke is hoping for a spirit of cooperation seeing that they agreed to sign this agreement because they know it is best for the county as a whole. It is in everyone’s best interest to have an equalized rate because it allows for the free flow of water a little easier between the center and western parts of the county.”
Landers explained that the original agreements with towns and villages dating back to the early 2000s each had “little nuances in them,” with different considerations.
“When the county took over individual water systems, the county water fund would make some compensation sometimes for that,” he said. “For example, we paid off some of the debt of the Corfu water plant for that village. All of the amended water supply agreements that the county have undertaken over the last three or four years have been uniform; we wanted to make sure that they’re all the same.”
The new agreements allow for the county, with proper notification and justification, to increase the surcharge above 60 cents (per 1,000 gallons). The original agreements were frozen at 60 cents but since then, the later agreements raised it to $1.20 to pay for Phase 2 of the Countywide Water Supply Project.
CLEANING UP THE LANGUAGE
The county manager said one of the sticking points was the county removing erroneous language in the initial agreements that guaranteed supplying water to the municipalities.
“It’s erroneous in the sense that the Monroe County Water Authority, in our agreement with them, can’t guarantee us water; there are things that can happen,” he said. “It is difficult for us to guarantee something that’s not guaranteed to us.”
He said that changes had to be made “because we need water to pay for water.”
“When we go to Phase 3, 4, 5, 6 and 7 (of the Countywide Water Supply Project), if there needs to be an increase (in the surcharge) to pay for the debt service, there needs to be a way to pay for it,” he said, adding that 20- to 30-year cash flow projections – including the retirement of some debt service -- indicate that the surcharge should not increase that much, if at all.
Landers said that he continues to speak to Darien Town Supervisor Steve Ferry Jr. about his board’s decision.
“If Darien passed a resolution next week and they signed the water agreement, it is possible that the amount in the resolution on the floor of the legislature on August 25th could be amended to be increased to $10 million,” he said. “I still have hope that we can find a path forward so that we can share the full $10 million in sales tax, and have everyone on the same water supply agreement.”
Asked if Ferry has sought concessions from the county, understanding that Darien has been paying more for water than other towns and villages, Landers would not go there.
“I don’t want to get into the subject of proposals back and forth,” he said. “I want all of that to be discussed between him and I, and our legislature and his board.”
Previously: Darien Town Board votes to not accept county's updated water agreement offer; Corfu signs on; Pembroke TBD.
Previously: Ways & Means passes measures rescinding revenue distribution payments, accepting HCA with Plug Power.
