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Lansing Town Supervisor Ed LaVigne announced Wednesday that the town Highway Department is giving back $200,000 of its budget to the Town's general fund.  Sales tax revenue accounts for the lion's share of the Highway Department DB budget.  LaVigne said that because of possible reductions in sales tax revenue due to the COVID-19 pandemic, Highway Superintendent Charlie 'Cricket' Purcell has diverted his crew from paving to road maintenance for the remainder of the season, concentrating on fortifying culverts and areas around the roads. 

"The Highway Department is busy, busy, busy," LaVigne said at Wednesday's Town Board meeting. "They are moving all their energy away from paving into other road maintenance.  One of the things he mentioned to me is his going to dump back $200,000 of his road paving allowance back to the budget.  So he'll make due with $200,000 less this year in the DB.  Any time you talk about the DB it's all about sales tax.  The County thinks sales tax revenue is going to be between 12% and 15% less than projected.  So he's dumping back $100,000 into that.  I asked him if I could say those are hard numbers, and he said 'yes'."

The Town's budget is divided into four funds (not including special districts like water and sewer and lighting districts, which are paid for by residents living in those districts).  General fund A and Highway Fund DA are funded by property taxes and other revenue from the whole town.  General fund B and Highway Fund DB are funded by revenue from the Town outside the Village of Lansing.  The DB fund was projected to receive $1,281,900 in sales tax revenue this year, the lion's share of sales tax revenue that the Town of Lansing receives, and a large chunk of the department's overall $1,484,300 2020 budget.

That does not account for the entire sales tax revenue -- the 2020 budget projected $317,390 in sales tax before the COVID-19 pandemic began, up from $260,029 in 2019.  An additional $317,390 in sales tax revenue was projected for the B Fund.

Town Councilman Joseph Wetmore cautioned that sales tax revenue has already decreased $125,000 so far this year, and guessed it will be closer to $200,000 by the end of the year.

"Everything I've been reading about the effect of COVID on the economy says this is going to be a five year process before we get back to normal," he said.  "I'm asking if you're starting to look at some of the cutbacks we are doing this year as longer-term so that we're ready for lower sales tax rates in the year coming up as well?  I think we're looking at a long term recession and it's hitting sales tax."

LaVigne said that coming up with contingency plans is part of Purcell's annual routine. 

"He's the one that came up with this plan in January and February," LaVigne said. "He does this every year, planning contingencies.  He also thinks our CHIPS money will probably be cut by 20%, and he's made contingencies for that also."

The State allots CHIPS (Consolidated Local Street and Highway Improvement Program) and SLRSP (Safer Local Roads and Streets Program) funding to the municipalities.  This year the Town, with 94.34 center line miles (188.52 lane-miles) was to receive $10,046.26 in CHIPS and $58,248.44 in SLRSP funding.  The Village of Lansing has its own Department of Public Works that maintains its 18.49 center line miles (38.44 lane-miles) of roadways.  The Village doesn't qualify for CHIPS money, but was expected to receive $19,740.81 in SLRSP.

LaVigne said that Lansing's finances are in very good health and there is no need to make drastic decisions about cutbacks, though he said it is important to watch revenue sources closely.  LaVigne said he thinks sales tax numbers may begin to rise again, since this has been the first month the county has been in Phase 4 of reopening.  He said the numbers for this month should be released in a week or so.

LaVigne said the Town has about $400,000, including the $200,000 from the Highway Department, on top of the six-month fund balance buffer most municipalities keep in case of emergencies.  He said that revenue trends over the next few months would provide significant information.

"I'm not going to make any drastic cuts or recommendations tonight," he said.

LaVigne added that the A Fund may see more mortgage tax than projected.

"People are refinancing their houses.  Because mortgage rates are so cheap.  People are staying at home and they're also fixing up their houses.  We're above our 50% mark on that."

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