Published: May 07, 2008 01:48 am      

ERIE COUNTY NOTEBOOK: Gas tax rebate eyed

The debate over the virtues of a gas tax holiday isn’t just for this year’s crop of presidential candidates.

Erie County Legislators Michele Iannello, D-Kenmore, and Kathy Konst, D-Lancaster, are trying to get the Legislature to cap the taxable amount for a gallon of gas at $3. They’ll be holding a public hearing today to get input from representatives of the local retail fuel industry, Erie County Comptroller’s Office and Division of Budget and Finance on the proposed legislation.

Members of the Niagara County Legislature are considering a similar proposal to temporarily suspend the collection of that county’s share of gasoline taxes for the summer, but the Erie County move would only drop the tax on anything over $3 per gallon.

Iannello and Konst tried to get a similar cap passed at $2 in 2006, but couldn’t get the support. This year’s proposal has to stay at $3 because that’s what the Legislature assumed when working out the 2008 budget, Iannello said.

“We wanted to cap it at $2, but we’re not because that wouldn’t be fiscally responsible when we approved a budget based on collecting from $3 per gallon,” Iannello said. “But anything over $3 a gallon was seen as a windfall, and with gas prices going out of control in recent weeks it would be better to give county residents a rebate at the pump.”

While that might be welcome news for motorists, County Comptroller Mark Poloncarz isn’t as enthusiastic. When examining the $2 cap in 2006, the comptroller’s office estimated a loss of more than $16 million for the county. The loss would be felt by the municipalities and school districts as well, since 46 percent of the 4.75 percent sales tax is shared with local governments, Poloncarz said.

“As Erie County’s chief fiscal officer, I advise against enacting a sales tax cap on gas,” Poloncarz said in a letter to the Legislature. “To enact a cap on gas at any level would negatively impact our efforts to end 2008 with a balanced budget.”

Even if the law went into effect, it couldn’t start dropping the taxes until September and would have to be renewed next February, Iannello said.

Park problems

On the other side of the aisle, Republican Legislators Edward Rath III, R-Williamsville, John Mills, R-East Aurora, and Michael Ranzenhofer, R-Clarence, are up in arms over what they view as a losing deal for the county.

Since 2004, the county has been managing the City of Buffalo Parks System. The group held a press conference Monday to discuss the agreement, which they said costs county taxpayers more that $1 million each year.

“When we entered into this agreement in 2004, it was made very clear to the Legislature that Erie County would break even and that didn’t happen,” Rath said.

The men co-sponsored a resolution on April 22 that would ask County Executive Chris Collins to renegotiate the agreement, but that was sent back to the Energy and Environment Committee for further review. The group contends that while the resolution languishes in committee, the parks are deteriorating because the spending for basic park maintenance is squelching funding for enhancing parklands.

“If the administration is unable to renegotiate this agreement in a way that honors its original intent, we need to start the process of terminating it,” Mills said.

Contact reporter Daniel Pyeat 693-1000, ext. 158 or at pyed@gnnewspaper.com.