ALBANY – Legislation that would restore Orange County’s additional sales tax revenue to its municipalities is headed to Governor Kathy Hochul’s desk to be signed into law after the State Assembly passed the bill on Monday night.

The Senate passed the legislation last week. Last month, it was revealed that the county had improperly distributed sales tax revenue to municipalities. The county has been sharing 3.75 percent of its sales tax revenue for more than a decade, though it is authorized to share only 3 percent.

This oversight could cost municipalities at least $20 million in 2026, and $5 million has already been withheld from cities, towns, and villages in the first quarter. A spokesperson for Hochul on Tuesday said that “Governor Hochul will review the legislation” without providing further comment.

“We are one step closer to preventing massive property tax hikes and service cuts as a result of the county administration’s violation of law,” Senator James Skoufis (D, Orange County) said. “I thank my Assembly colleagues for their partnership and due diligence.”

Skoufis and Assemblyman Chris Eachus (D, New Windsor) are the prime sponsors of the bill in Albany, with the county’s other lawmakers – Democrat and Republican, including Assemblyman Jonathan Jacobson (D, Newburgh) and Rob Rolison (R, Poughkeepsie) also backing the measure.

“I’m glad that we were able to move quickly and clean up the county’s mess, so neither municipalities nor taxpayers will be hurt,” Jacobson said.

Skoufis hopes the law is passed by July 1, before Orange County municipalities are withheld additional sales tax. If the legislation is signed, the County’s towns, villages, and cities will be reimbursed the full amount they have lost retroactively to January 1, 2026. Meantime, municipalities are making contingency plans, such as potential hiring freezes, budget cuts, and other cost-cutting measures, which will be avoided if Hochul signs the legislation as expected.

The County only learned of its decade-long sales tax error in early April when County Attorney Rick Golden’s Deputy, Carol Pierce, was informed of the oversight by the State Comptroller’s Office. Public policy experts have said that the County’s error could result in an audit by the Comptroller’s Office.

A spokesperson for the Comptroller’s Office said an audit of Orange County is not planned at this time.

“We are monitoring the situation, including the legislation that has now passed both houses of the legislature,” the spokesperson added.


Original article
Add as a preferred source on Google