Orange County Legislature Doesn’t Pass Gas Tax Cap but Expresses Interest in Revisiting Issue

MIDDLETOWN, N.Y.—The Orange County Legislature fell two votes short of approving a temporary measure on April 28 to stop collecting sales tax on gasoline prices above $3 per gallon, despite several legislators indicating they supported the concept of tax relief.

The attempted change comes as gas prices hit a national 4-year high, with the average Orange County price per gallon at $4.21 as of April 29. The resolution failed to pass as only nine of the 17 present legislators voted in favor, with 11 needed to pass it. The county legislature has 21 total representatives.

Since Orange County holds a 3.75 percent sales tax, the cap would have saved drivers 3.75 cents per gallon for every dollar the price of gas exceeded that $3 threshold. At current gasoline prices, the savings per gallon would be close to 5 cents. The resolution would’ve gone into effect on June 1 and ended on March 1, 2027.

Legislator Stephen Hunter said during the meeting that passing the tax cap is the economically responsible thing to do, as higher gas prices raise the prices of other goods as well. He also mentioned that Rockland, Dutchess, Ulster, and Putnam counties have implemented similar regulations, and that it would be disadvantageous to have the region’s highest gas prices.

“If we do nothing, and just 20 percent of our residents decide to fill up across the border, where it’s cheaper, the leakage will cost this county and local municipalities more than the projected cost of the tax cap itself,” Hunter said. “Doing nothing isn’t protecting our revenue. It’s actively subsidizing the budgets of our neighbors.”

Two Orange County residents spoke before the legislature in favor of the tax cap. Stephanie Powell from the Town of Woodbury said that the gas where she works in New Jersey is cheaper and that many people leave the county to purchase gas.

“If gas is cheaper across state or county lines, many drivers will cross that line without hesitation, and when they do, Orange County doesn’t just lose out on gas tax sales. They lose out on coffee and tax and sales from groceries and many other businesses.”

Wallkill Supervisor Frank DenDanto spoke to the legislature in opposition to the tax cap. He said that the cap would weaken his town during a time of financial struggle, as sales tax is one of the only ways for governments to raise revenue.

“We have few opportunities to make money. And governing costs money, roads cost money, water costs money, police forces cost money,” DenDanto said. “When you reduce those taxes, you reduce our ability to provide those services.”

Legislator Janet Sutherland said the leaders in her district, around the Town of Mount Hope, asked her not to pass the tax cap. She mentioned that Otisville would have to cancel its junior police academy, and that it would impact its summer help and parks and recreation.

Legislator Kathy Stegenga voted no on the resolution, but said she would be willing to revisit it in September. Her major issue was that the county’s municipalities are currently in a financial limbo, as a tax distribution error recently discovered by the state comptroller’s office could take away 15 to 20 percent of the sales tax distributed to municipalities by the county. A resolution was passed to send a home rule regulation to the state legislature to legalize the error, but Stegenga is worried that if the legislation is not passed soon enough, the municipalities would be in a situation where the gas tax would be badly needed.

Legislator Thomas Faggione also opposed the proposition on a gas tax cap due to the possible loss of distributable money, and said that he would be open to the option at a later date.

“That means no today. That doesn’t mean no tomorrow,” he said.

Robert Sassi from County District 9 said he had voted yes on the proposition when it was previously brought before the legislature, but that he won’t now, given the lingering uncertainty about the tax distribution error.

Sassi said he feels the legislature should pass the proposition, but right now is not the time, and he would feel better if it were brought up at a later date.