Town revenue drops as housing sales slump

NORTH CREEK - The economic times are tough and the town of Johnsburg isn't immune as two primary economic indicators and town revenue streams have dipped - one sharply.

According to town officials, the first fiscal quarter mortgage tax reimbursement from Warren County to Johnsburg is $21,000 - a 56.5 percent decline from 2008.

The sales tax reimbursement also declined. The town received $180,000 for the first quarter - a 3.2 percent reduction from 2008.

"We need to remain cognoscente of a potential calamity on the horizon," Johnsburg Supervisor Sterling Goodspeed said this week. "We are seeing signs that the current economy has hit us pretty hard."

In the 2009 budget, the town anticipated $761,000 in sales tax revenue and an additional $75,000 in mortgage tax revenue, but if the current trends hold the amount the town actually receives may fall well short.

"The mortgage tax data is direct evidence of what a recession does," Goodspeed said. "It grinds the housing market to a halt."

The New York State mortgage tax requires all property buyers to pay a percentage of the sale value to the state and county. The county then pays a fraction collected to the towns.

According to Warren County Real Property Tax Services Director Mike Swan, the amount a town receives from mortgage taxes is related to number of sales and the total costs of the properties being sold. Warren County collects $1.25 per $100 mortgaged.

"It is a county-wide problem," Swan said. "We are down around 150 sales per month of homes from our peak three years ago."

Although anticipated revenue may be down, Goodspeed said that the town has around $24,000 in available contingency funds and additional unappropriated general funds which will likely allow Johnsburg to weather the current crises.

"With good projects coming in the door seeking funding, we may have to take a hard look at what we give money to," he said. "We just can't blast through our contingency at a time like this."

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