In Upstate New York, Mortgage Tax Increase Boost County’s Revenue

It’s been 18 months the Franklin County Clerk’s Office, in Upstate New York, began collecting a full 1 percent in mortgage tax fees.

That’s all it took the office to earn another $525,000.

Moreover, the 19 towns and six villages who split the cash with the state and county have since divided more than $1.1 million, according to the Plattsburgh Press-Republican.

In the past, the three-quarters of 1 percent paid by people who refinanced a New York mortgage or purchased a home was split up, with 50 percent going to the towns and villages and the other 25 percent split between the county and New York State.

At the urging of the County Clerk’s Office, the Franklin County Legislature raised the fee on home purchase loans and mortgage refinancing by one-quarter of a percent to a full 1 percent, as of April ‘05.

Even as the housing market has slowed and mortgage costs have risen throughout the state, the number of people looking to refinance home loans has increased, as they look to lock in on fixed rates. That’s good news for county coffers, which get a portion of each transaction filed.

The division of revenue was also changed. The towns and villages still share half the total income, but the county and the state now each get one quarter of the total.

Since then, Franklin County has taken in $524,280, the state made $530,450, and the towns and villages have split $1,175,300 in fees. The County Clerk’s Office is paid about $33,000 to administer the program.

Local municipalities can spend their share of the money any way they want, but the county must dedicate its share to a capital-improvement project.

Legislators chose to pay off public debt.

The last two payouts made through the taxes on home mortgages made the final payment on the debt owed on the County Courthouse. But there’s still outstanding debt of $4.6 million on the Public Safety Building on Bare Hill Road, which is expected to be paid off in 2012.