(Buffalo, NY, January 19, 2006) - - Erie County lawmakers are dealing with another financial dilemma: How do you close the gap if you're forced to share more sales tax with local governments and school districts? News 4's Mylous Hairston reports from Thursday's meeting of the Erie County legislature.

Erie County lawmakers are looking for ways to save the county tens of millions of dollars.

Democratic legislator George Holt said, "If we're looking at 30 million dollars cut in our budget in '07, maybe we need to take that 30 million or more out of the Department of Social Services."

Facing mounting pressure from Albany to share the eighth penny of the sales tax with the City of Buffalo and other municipalities, lawmakers are looking at a potential massive budget deficit.

Hairston: Any red flags that you see for the county legislature this year?

Democratic Erie County Comptroller Mark Poloncarz: Well, the only real red flag and worry is whether or not we're going to have to share the one-percent penny, so to speak, of the sales tax that's being proposed by the New York State Assembly right now. If we are to share it, then we could potentially lose 30 million dollars in revenue that we were anticipating receiving for 2007. Erie County's already required, at this point, to come up with 40 million dollars in cost-saving initiatives for 2007.

Lawmakers took no action on the sales tax matter at this brief afternoon session.

However, Poloncarz says property owners may have to pay more next year to balance the budget.

Poloncarz said, "If we cannot come up with those cost-savings, the only alternative we may have is a property tax increase."

Democratic legislator Thomas Loughran is proposing any sales tax sharing with municipalities be tied to incentives for proven cost reductions.

Democratic majority leader Maria Whyte believes there's room to negotiate.

Whyte said, "Other options are to graduate the money that we would actually share with the city. Do one million dollars one year, five million dollars another year. Another option might be to wait until after the four-year plan is done."

Whyte says there's been at least one productive meeting with state leaders.

It's not clear when lawmakers will take action on the sales tax.

But what is clear is that doing nothing is not an option.

Copyright WGRZ-TV, 2006