Erie County residents may want to brush up on the lyrics to “O Canada,” because signs point to our friends to the north as the reason for better-than-expected sales tax revenue lately.

The refrain should be sung, though, with the thought that nothing lasts forever, and local budgets balanced on the continuing hope that more pennies — or, for that matter, loonies — will continue to fall into government coffers are misguided.

Such is the danger when the Canadian and American dollar are roughly at par. Earlier, Canada enjoyed a stronger currency, sending scores of drivers across the border and into this area’s stores. The weaker American dollar proved a boon to Erie County, in particular, because of its location on that border. New information shows sale tax revenues at roughly $12 million more than what was projected for the county budget, and more than $26 million higher than last year with an increase of nearly 7.4 percent.

Both County Comptroller Mark C. Poloncarz and Erie County Executive Chris Collins struck an appropriate note of caution when it comes to what feels like “found money.” It really isn’t, but higher-than-projected sales tax revenue may look like a lottery ticket win to municipal budget crunchers and residents who lived through the previous administration’s red budget/green budget debacle.

It’s still welcome news, but don’t expect an Erie County stimulus package promising to put money back into taxpayer pockets. The increase, prudently, will be used to increase the county’s reserves — straight to the piggy bank, as the county executive has indicated, which will look a lot better to Wall Street and help the county in the longer run. If there is a downturn in the Canadian economy, or if the exchange rate returns to where it was more than a year ago, any government official expecting year in, year out high sales tax income would be proven wrong. And all local municipalities would be affected because the county shares its sales tax, with roughly 46 percent of the local share going to cities, towns, villages and school districts.

That’s why the comptroller’s warning was directed not only to county officials, who seem to understand, but to those who rely on sales tax sharing. This a revenue spike, not a revenue stream, and the comptroller is right in sending a reminder to be cautious to anyone expecting, in 2008-09 budgets, loonies from heaven.

Copyright 2008 - The Buffalo News