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Local News

January 26, 2013

Manor plan hinges on tax hike, union

A new proposal to stave off privatization of the 174-bed Otsego Manor hinges on persuading unionized workers to accept significant contractual givebacks and building public support for an increase in Otsego County’s share of the sales tax.

The proposal by county Rep. John Kosmer, D-Fly Creek, is designed to avoid selling the Manor to a private company that could replace the current workforce with its own staffers and keep the facility, built at the cost of $33 million, as a county-owned asset.

Kosmer suggested the plan could only work if the public supports a 0.25 percentage-point increase in the current total sales tax rate of 8 percent.

The county and local governments share half of the sales-tax revenues. The state gets the other half. Raising the rate to 8.25 percent percent could generate an additional $1.6 million, which could help offset the Manor’s deficit.

According to a briefing memo that Kosmer shared with other county lawmakers Friday, any increase in the local sales tax would have to be approved by the state Legislature.

But before the sales-tax effort could be undertaken, the county would have to persuade the Civil Service Employees Association — a union representing more than 200 Manor workers — to make contractual concessions, Kosmer suggested.

He said the county needs “a minimum of $1.6 million to $3.8 million in consensus reductions.” The givebacks, coupled with the additional revenue from the higher sales tax, would put the county in a position to subsidize the Manor to the tune of $2.4 million — well below the subsidy level that would otherwise be needed if it were to stay a public nursing home, he said.

“If, and only if, a CSEA contract is renegotiated, public support must be gauged,” Kosmer wrote in outlining the plan.

He suggested secure online technology could be used to poll county residents about whether they support the proposals that would allow the home to be kept by the county or prefer the privatization option.

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