County’s Item Pricing Fee Hits Opposition

When Putnam County passed its budget last October it did so under little fanfare. Now one of its proposed revenue generators is under fire.

An amendment to Putnam County’s Local Law Chapter 173 titled “Item Pricing,” included a wavier fee schedule for retailers. The waiver, which had a sliding fee from $750 to $15,000 based on the size of the store, allowed a company to opt out of complying with the law instead of being penalized for inaccurately or not individually pricing items.

Lobbyists of the Food Industry Alliance of New York and the Retail Council of New York State brought the issue to State Sen. Greg Ball’s attention.

According to Mitch Klein, the Chairman of the Food Industry Alliance of New York, with the passage of this law, Putnam County has now implemented the highest item pricing wavier fee statewide.

“The steps the county has taken not only defeat any benefit, it assures that this program will be a lose – lose for both sides,” Klein wrote in a letter. “The only accomplishment here is that retailers will look over the border to Connecticut which is far less restrictive.”

Michael Rosen, Sr. VP of the Food Industry Alliance, a trade association of supermarkets, noted the annual fee will impact on retailers’ ability to expand, pay better wages and buy new products.

“We are disappointed that Putnam County enacted the highest fee schedule in the state and chose to impose other costly requirements on business,” said Rosen. “We hope County Executive [MaryEllen] Odell will take the lead in adopting a more reasonable law.”

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It was said that the added cost of the fees would be passed along to the consumer and could stun job growth.

“This new law has less to do with protecting consumers than it does raising revenue for the county,” said Retail Council of New York State EVP Ted Potrikus. “Outlandish and irrational fees like this do nothing except raise prices for every shopper in the county and are absolutely detrimental to economic development and job growth.”

Ball wrote to the county executive’s office and the legislature to see if they would reconsider the fee schedule so Putnam County could appear to a business-friendly community.

“We need to keep New York open for business. Revising the new ‘item pricing’ fee schedule to be more conducive to local businesses is worthy of our leaders’ consideration,” Ball said. “I urge Putnam County officials to work with all concerned parties to develop a remedy. I stand ready to assist in any way.”

Putnam County’s Director of Consumer Affairs Jean Noel, who had previously worked for the state’s department of consumer affairs, said that the county based its fee schedule on those implemented in Mount Vernon, a city that has similar circumstances as Putnam County in reference to build-out potential and population size.

“The waiver fee is still less than what the penalties stores would have to pay,” said Noel.

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Noel also noted that the consumer affairs department required so much money from contractors, electricians and plumbers in the community, who were typically small business owners, and that it was time to go after the bigger stores and enforce a law that was already on the books.

“This really affects the big stores of Putnam County like Home Depot, Kmart and the supermarkets,” said Noel. “This is not about the small business owners.”

According to the law, stores that earn under $3 million a year, that are not part of chain or subsidiary or that are family-run operations with up to two other full-time employees are exempt from having to comply with the law.

Legislators Dini LoBue and Roger Gross, who voted against the item price resolution last Nov. want to see the resolution rescinded.

“We have such a hard time competing with Connecticut,” said LoBue. “This is just an additional tax and it is irresponsible. I feel deprived that I did not know until know that these are the highest fees in the state. This is just a way to book revenue for the 2013 budget.”

While LoBue will not be introducing a resolution to rescind the law she has had the topic added to the Tuesday, March 19 meeting of the legislature’s rules committee.

Both parties intend to be there.