Warren County officials are formally considering the implementation of a local real estate transfer tax, a move projected to generate an additional $3 million in annual revenue. The proposal aims to address increasing financial pressures on the county's general fund without raising property taxes for all residents.
The discussion, brought back to the forefront by County Clerk Carrie Black, comes as the county grapples with rising operational costs and the loss of other income sources. If the plan moves forward through county and state legislative processes, the new tax would not be implemented until at least January 2027.
Key Takeaways
- Warren County is exploring a new real estate transfer tax to generate an estimated $3 million annually.
- The proposed tax rate would match the current New York State rate of $2 for every $500 of a property's sale price.
- This initiative is a response to rising county costs and a reduction in other revenue streams, such as mortgage tax funds.
- Implementation requires approval from the County Board of Supervisors, followed by enabling legislation from New York State, with a potential start date of January 2027.
A Potential $3 Million Annual Revenue Stream
County officials are analyzing the real estate transfer tax as a significant and recurring source of income. The primary goal is to bolster the county's general fund, which finances essential public services.
John Strough, the Queensbury Town Supervisor who also chairs the county's Legislative and Rules Committee, highlighted the financial opportunity. He noted that Warren County is one of the few places that does not currently levy this type of local tax.
"Warren County does not impose a local real estate transfer tax, which is a significant opportunity to generate a substantial recurring revenue stream. Based on a preliminary analysis of local transfer tax, it has the potential to collect an additional $3 million annually."
Strough emphasized that this revenue could be a crucial resource for the county, providing a financial cushion without directly increasing the annual property tax burden on all constituents. The tax would only apply to properties at the time of their sale.
Significant Past Opportunity
According to Warren County Clerk Carrie Black, had the county implemented a transfer tax matching the state's rate over the past six years, it could have collected approximately $17 million in total revenue. This figure underscores the substantial financial impact such a tax could have over time.
The conversation around the tax was initially discussed last year but has gained new momentum due to persistent budgetary challenges. "We had this discussion last year, and we would like to revisit it again," Strough added, signaling a more serious consideration by the committee.
How the Proposed Tax Would Work
A real estate transfer tax is a one-time fee imposed by a government body when the ownership of a property is transferred from a seller to a buyer. In most transactions, the seller is responsible for paying the tax.
The current proposal suggests that Warren County would match the existing New York State transfer tax rate.
Matching the State Rate
New York State currently collects a tax of $2 for every $500 of consideration (the sale price) during a real estate transaction. If Warren County adopts this rate, a home sold for $400,000 would incur a local transfer tax of $1,600, in addition to the identical amount paid to the state.
County Clerk Carrie Black confirmed the potential revenue by referencing this rate. "If we matched what the State takes in for transfer tax, we would have made a total of about $17 million over the last six years. So it’s a significant revenue," she said.
The Impact of the 'Mansion Tax'
In addition to the standard transfer tax, New York State also imposes a separate 1% tax on residential sales of $1 million or more, commonly known as the "mansion tax." Warren County Attorney Larry Elmen explained that this existing state-level tax already affects high-value properties in the area.
"That would apply to some of the higher-valued properties in Warren County," Elmen stated. Given the number of expensive homes, particularly on Lake George, this existing tax provides a model for how higher-end sales can generate substantial funds. While the current proposal does not include a local mansion tax, the high volume of million-dollar sales in the county highlights a potentially lucrative market for tax revenue.
Officials Weigh Financial Pressures and Taxpayer Impact
The push for the new tax is directly linked to the county's challenging financial outlook. Several officials have voiced concerns about covering increasing expenses for salaries, healthcare benefits, and other essential services.
Funding Mass Transit Creates Budget Hole
Bolton Town Supervisor Ron Conover pointed to a specific financial strain: the county's decision to use mortgage tax revenue to fund the regional mass transit system. This move redirected between $1.1 million and $1.3 million annually away from the general fund. "That revenue was just extinguished from the budget — for good purpose," Conover said. "But that was a big hit for us... that’s recurring, it’s every year."
Conover framed the transfer tax discussion as a necessary exploration of limited options. "How do we want to finance these programs and services going forward? We all might have differing opinions... But I think we should be well-informed on this particular subject," he commented.
Stony Creek Town Supervisor Frank Thomas, a county budget officer, offered a more direct assessment of the county's financial situation.
"The county needs the money, and if you don’t think so, you’re going to find out shortly. It’s not just this year — you’re going to need the money next year and the following years, the county needs more revenue. Period."
However, there is an acknowledgment of the political difficulty of introducing any new tax. Glens Falls Ward 3 Supervisor Ben Driscoll expressed this common sentiment, stating, "We never want to impose additional taxes. Whether we’re Republican or Democrat, no one wants to say, ‘Oh, we’re going to tax you more.’"
The Path to Implementation
Even with support from key committee members, enacting a real estate transfer tax is a multi-step process that will take considerable time. The county cannot act alone and requires authorization from the state government.
County Attorney Larry Elmen outlined the necessary legislative journey:
- County Approval: The Warren County Board of Supervisors must first formally agree to pursue the tax.
- State Legislation: The county must then seek permission from New York State. A bill must be passed by the State Legislature and signed into law by the governor, specifically granting Warren County the authority to impose this tax.
- Local Law: Once state approval is secured, the Warren County Board of Supervisors would need to pass a local law to officially establish the tax, its rate, and its implementation details.
According to Elmen's analysis, navigating these steps is a lengthy process. He projects that if all approvals are granted in a timely manner, the earliest the tax could possibly take effect is January 2027. This long timeline means the proposed tax is not a solution for immediate budget gaps but rather a long-term strategy for financial stability.
The preliminary research conducted by Elmen and Black also identified that nearby Essex County already imposes a similar local real estate transfer tax, providing a regional precedent for the proposal.
