Mychajliw says Erie County overestimated '15 sales tax revenue, creating $9 million shortfall

Mar 10, 2016

Just hours before the Erie County Executive was set to deliver his State of the County Address, the county's top fiscal watchdog issued a warning that the county overestimated sales tax revenues for 2015 and could see a serious budget problem if it doesn't curb spending in 2016.

Erie County Comptroller Stefan Mychajliw says the county budget anticipated an approximate 3.5% in sales tax revenue in 2015. While there continues to be increasing sales tax revenue, Mychajliw says the rate is slowing. According to his report, the rate of growth in 2015 was only 1.5%, resulting in a nearly $9 million budget shortfall.

Erie County Comptroller Stefan Mychajliw meets with reporters in his office Thursday morning, where he released a report suggesting the county budget overestimates sales tax revenues from 2015, creating a nearly $9 million shortfall.
Credit Michael Mroziak, WBFO

The blame, Mychajliw says, rests on falling oil prices. He acknowledged the benefits to Erie County residents, notably lower gas prices. The savings, he said, have been used to spend on other purchases which generate sales tax revenue.

The concern is for how lower oil prices impact the Canadian economy, which relies heavily on oil prices. The Canadian dollar has also decreased in value and, in turn, has kept many visitors from crossing the border to shop in Erie County.

"It does not appear as though the Canadian dollar is going to bounce back," Mychajliw said. "It does not appear as though the loony is going to strengthen. It does not appear as though gas prices will go up. I would strongly advise the County Executive and Legislature to keep a very close eye on spending in 2016."

He then criticized County Executive Poloncarz for what he considers some questionable spending in light of what he defines as an "unfortunate perfect economic storm."

"We have a county executive that wants spend about half a million dollars on a park study, even though we have a park study that was done in 2003 and is sitting on a shelf," Mychajliw said. "I find it outrageous that the county executive wants to spend $75,000 on a study of plastic bags."

Poloncarz was expected to propose a ban on plastic shopping bags in Erie County during his State of the County Address.  Mychajliw said while that may look good to "New York liberals," he called the proposal "tone deaf" to the needs of people in the Buffalo area struggling to make ends meet.