New York’s recreational adult-use cannabis market represents a new legalized industry and, as such, its development presents new and unique issues for local governments, particularly for the cities, towns and villages that will have marijuana retail dispensaries and consumption sites located within their jurisdictions. The purpose of this report is to briefly provide a background on the 2021 cannabis law, including its major components and actors, and to touch upon its financial and operational implications for local governments.

Local government sales tax collections in New York State totaled $5.5 billion in the first calendar quarter of 2023, up 7.1 percent (or $369 million) compared to the same period last year. Despite strong first quarter collections, sales tax growth continues to moderate, returning to more typical collections patterns seen prior to the pandemic. New York City experienced sales tax growth of 11.3 percent in the first quarter, while most counties and preempting cities throughout the rest of the State saw some growth as well. | Regional Table [.xlsx]

A sample of 95 local governments across New York State reported $1.34 billion in actual and anticipated spending on capital projects over a 10-year period, with about $737 million (55% of the total) in response to climate-related hazards such as increased flooding and storm damage. A review of New York City’s capital commitments for fiscal year 2023 showed that it included $829 million for adaptation and resilience projects, and another $1.3 billion for projects with adaptation and resilience components, with planned commitments averaging more than $1.8 billion per year. | Survey: Cost of Adapting to Climate Change

Local sales tax collections in New York State totaled $22.1 billion in 2022, up 12.7% ($2.5 billion) from 2021, mainly driven by inflation and strong sales statewide, especially in New York City. Overall sales tax growth, even though moderating somewhat recently, has remained high since the initial “bounce back” in the spring of 2021. New York City experienced sales tax growth of 20.6 percent in 2022, while every county and preempting city throughout the rest of the State saw some growth as well. | Regional Table [.xlsx]

This snapshot highlights the FSMS results for school districts that reported for school fiscal year (SY) 2021-22, which ended on June 30, 2022. Fewer school districts were scored in fiscal stress in this year than any other year since the System’s inception largely due to increases in State aid and temporary federal aid.

Local government sales tax collections totaled nearly $5.7 billion and grew by 10.2%, or $529 million, in the third quarter of 2022 compared to the same period last year, mostly driven by double digit growth in New York City. However, local governments are contending with higher costs from inflation, which was 8.3% nationally. Adjusting for inflation, year-over-year growth in the value of sales tax revenue for the third quarter was 1.8%. | Regional Table [.xlsx]

This snapshot highlights the results for counties, cities, towns and villages that reported for local fiscal years ending (FYE) 2021. Overall, the influx of federal pandemic relief aid and rapid recovery of sales tax revenues were significant factors in lowering many municipalities’ fiscal stress scores in FYE 2021, especially for calendar year local governments.

Local government sales tax collections in New York State totaled over $5.5 billion in the second quarter of 2022, an increase of 12.2 percent, or nearly $604 million, compared to the same quarter last year. April and May collections grew by 15.7 percent and 16.7 percent, respectively, while June increased 6.5 percent, marking the first time since March 2021 the monthly year-over-year growth dipped below double-digits. New York City’s second quarter collections increased by 24.9%, up from relatively weak collections in April-June 2021, while growth for the counties and cities in the rest of the State slowed to 2.6% over the same period last year. Only a handful of counties saw more than 5 percent year-over-year growth in the second quarter and 31 counties experienced declines. | Regional Table [.xlsx]

Local government sales tax collections totaled nearly $5.2 billion in the first quarter of 2022, an increase of 21.1 percent, or $901 million, compared to the same quarter the previous year. This growth was at least partially driven by inflation, which hit a 40-year-high in March, most notably for gasoline, new and used cars, and household energy costs. Almost every county outside of New York City experienced double-digit growth in the first quarter. New York City’s collections grew by 28.5 percent and exceeded pre-pandemic levels for the second straight quarter after remaining below pre-pandemic levels for most of 2020 and 2021. The report notes that the recently enacted state budget eliminates county sales tax withholdings outside of New York City, and also provides for a partial suspension of certain state taxes on gasoline from June to December 2022. | Regional Table [.xlsx]

The Aid and Incentives for Municipalities (AIM) program, the State’s unrestricted aid program for cities, towns and villages, has remained flat or declined over the last decade.  Also called revenue sharing, this aid to local governments has declined by 24% since 2011, when the state’s real property tax cap was enacted. This aid is important for municipalities, since it can be used for any governmental purpose, and it is particularly vital to many cities.

New York State local government sales tax collections totaled $19.6 billion in 2021, an increase of 19.1 percent, or $3.1 billion, compared to the previous year. This was the highest annual jump on record after a historic low in 2020 when local sales tax collections declined by 10 percent. The report examines the many factors that drove sales tax growth in 2021, including inflation, along with the difference in sales tax recovery between New York City and the rest of the State. The report also analyzes the pandemic’s impact on consumer spending, particularly as it pertains to the local taxable sales and purchases for the State’s key sectors, such as retail trade and accommodation and food services. | Regional Table [.xlsx]

Local governments across the state own 85 percent of all roads, from city and village streets to town roads and county highways. In fiscal year 2020, local governments, excluding New York City, spent $2 billion on road maintenance, repairs and upgrades, a decline of 7 percent since 2010. This report looks at local road spending, State and federal road aid, and the need for a comprehensive assessment of road conditions, maintenance needs and associated costs. | Interactive Map

This snapshot highlights the FSMS results for school districts that reported for school fiscal year (SY) 2020-21, which ended on June 30, 2021. Fewer school districts were scored in fiscal stress in this year, but the COViD-19 pandemic and the local, State and federal responses to it had a negative impact on district operations.

Statewide local sales tax collections grew by 17.5% in November compared to the same month in 2020. Overall, local collections totaled almost $1.6 billion, up $235 million from November of last year. Collections for the month were also notably robust when compared to pre-pandemic levels, up 9.2% (or $133 million) from November of 2019. New York City’s collections totaled $696 million, an increase of 12.6% – or nearly $78 million – when compared to November of 2020. Nearly every county experienced significant year-over-year growth in collections for November. | Regional Table [.xlsx]

Statewide local government sales tax collections in October totaled more than $1.5 billion, an increase of 12.9 percent (or $175 million) compared to the same month in 2020. This growth continued the trend of monthly collections since April exceeding 2020 results. Strong local sales tax performance in October reflects weakened collections during the same month in 2020, when many parts of the state were still adversely impacted by the pandemic. That said, October 2021 total collections were fairly strong even when compared to the figures reported during pre-pandemic levels, up 7 percent (or $101 million) over October of 2019. Nearly every county outside of New York City saw year-over-year collections for October grow by double digits, while New York City’s sales taxes increased by 8.3 percent or over $51 million. | Regional Table [.xlsx]

This report highlights the results of the 2020 Census for local governments in New York State and accompanies a new online interactive map that provides census population statistics by age, race and ethnicity, along with housing trends, for each city, county, town and village statewide. | Interactive Census Dashboard

Local government sales tax collections totaled nearly $5.2 billion in the third quarter of 2021, up $861 million (20 percent) compared to the same period last year. Every region in the State, including New York City, experienced robust growth in sales tax revenue. When compared to pre-pandemic levels, statewide local collections grew by 8.6 percent ($409 million) this past quarter over the same period in 2019. In fact, the third quarter marked the fifth quarter in a row that county and city sales tax receipts outside of New York City met or exceeded 2019 pre-pandemic levels for the same period. New York City collections have been recovering more slowly since the second quarter of 2020, but its sales tax revenue has nearly reached pre-pandemic levels. | Regional Table [.xlsx]

The case studies described in this report provide insight into some of the fiscal challenges that the COVID-19 pandemic presented to individual local governments in 2020. OSC staff conducted interviews and financial analysis in late fall 2020, choosing the Mid-Hudson region as the geographical focus. The City of Peekskill, the Town of Cornwall and the Village of New Paltz agreed to participate in the study. Each had its own unique experience in 2020, but each also shows some of the typical problems facing local governments throughout the region and the State.

This snapshot highlights the results for counties, cities, towns and villages that reported for local fiscal years ending (FYE) 2020. These scores, therefore, reflect the partial-year impact of the COVID-19 pandemic on operations for most local governments.

Local government sales tax collections in August increased by 15.5 percent, or $204 million, over the same month in 2020, making it the fifth month in a row that collections exceeded 2020 results. The double-digit growth in local sales taxes reflects the fact that collections during August of 2020 were fairly weak as sales activity was recovering in certain parts of the state from the early effects of the pandemic. Still, August 2021 total collections were strong even by comparison with pre-pandemic levels, growing 6.5 percent, or nearly $93 million, over August of 2019. Every county outside of New York City saw year-over-year collections for August grow by double digits, while New York City’s collections increased by 7.9 percent or over $45 million. | Regional Table [.xlsx]