PROPERTY TAX UPDATE – MAY 2008
Over the course of the past several years there has been an ever increasing dissatisfaction and outrage with the ever increasing property taxes, which often reach confiscatory levels. I just want to summarize some of the activity which has taken place aimed at addressing this issue.
On April, 2004 the Hague Tax Assessment Committee concluded that “The significant demand of unfunded State and Federal mandates, contractual commitments to teachers and staff, increased contributions to retirement funds, increased healthcare costs taken together have driven large budget increases as well as limit the level of local control. Our legislators understand these concerns, however the sheer magnitude of effort required to enact any changes has resulted in slow and limited progress.”
In September 2004, working with concerned taxpayers in the three counties surrounding Lake George, the Tri-County Committee for Property Tax Relief was formed. The Tri-County Committee for Property Tax Relief is an action-oriented group of citizens in the North Country who are deeply concerned about the burdens and inequities of New York State's local property tax system -- a situation spiraling out of control. Steering committee members include: Richard Gladu – Hague, N. Y., Warren County, John Whiteley – Ticonderoga, N. Y. ,Essex County, and Bert Windle – Putnam N. Y., Washington County.
By mid April, 2005, the Town of Hague passed Resolution 44 in favor of school funding reform highlighting the gradual transition to full state funding of education to eliminate the irrational reliance on property values, the elimination of unfunded mandates, and the establishment of property tax relief measures such as the circuit breaker for residents tying the property tax to a percentage of a persons income.
On August 15, 2005 A petition Letter to the Taxpayers of Hague was circulated declaring;
“Property taxes have continued to represent the largest single concern expressed by the residents of our Town. Unlike income tax, which is based upon an individual’s income, property taxes bear no relationship to an individual’s ability to pay.”
Subsequently, on November 5, 2005, a Petition signed by 271 residents was sent from to our Legislators Specifically, requesting consideration of the following;
1. Cap spending at all levels to a maximum set by the CPI index.
a. State, County, Town, School District levels.
2. Initiate Property tax reform at the State level, with the goal of reducing or eliminating the property tax as a source of revenue, especially for school funding.
a. Transition to State funding of all school budgets based upon a cost of basic education model.
3. Incorporate a circuit-breaker relief for the individual property taxpayer in the form of a limit on an individual’s year to year increase in property tax assessment and a limit on an individual’s tax liability based on his or her income
4. Insure statewide equity in property assessments using common assessment principles, with mandated real property tax assessments every 5 years.
5. Refrain from imposing State mandated requirements upon school districts without corresponding funding.”
In May 2006, at a meeting in Lake George with Senator Little on property tax reform, the Tri County Committee suggested the establishment of a Blue Ribbon Commission to identify the drivers of this out of control property tax situation and recommend changes to fix this problem.
As a result of a significant grass roots effort amongst the activist groups, now operating as the New York State Coalition For Property Tax Reform and numbering over 52 groups representing tens of thousands of concerned taxpayers stretching from Long Island to Buffalo to Syracuse, to the Adirondacks, Senator Little introduced such a Bill on May 9, 2007, which passed in the Senate and later died in the Assembly.
Recognizing the significance of this issue, Governor Spitzer, under executive order on January 23, 2008, established the New York State Commission on Property tax relief.
Chaired by Nassau County Executive Tom Suozzi, the Commission will study, examine, investigate, review and make recommendations in the following areas.
As represented by Chairman Suozzi;
“This bipartisan commission is charged with examining, investigating and recommending “the most effective approach to imposing a limit on local school property tax growth in New York State without adversely impacting the ability of school districts to provide a quality education to all students.”
The Commission also is charged with developing a package of reforms to address unfunded mandates and other root causes of high property taxes, as well as developing proposals to make the property tax relief system more fair for middle-class property owners.”
Subsequent to the resignation of Governor Spitzer, the Commission was then endorsed by Governor David Paterson who has made property tax relief a priority of his administration.
The Commission has held 8 public meetings Statewide, soliciting testimony from many expert witnesses, legislators, public interest groups, tax acticists, as well as concerned citizens.
These meetings have have provided a platform for us to push for the Galef / Little Circuit Breaker Bill - ( A1575a / S1053a . (Unlike a spending or tax levy Cap which limits the rate of spending, Circuit breakers provide property tax relief via income tax credits. Based on homeowners’ income, a certain percent of any property taxes paid over a percentage of owners’ income are credited back to the taxpayer via the income tax credit.)
John Whiteley, who has been selected as the spokesperson for the Tri-County Committee, and has been addressing this problem over the past 15 years, has attended all 8 meetings, providing testimony in support of the Circuit Breaker bill. I have had the opportunity of attending and providing testimony at the Commission meetings in Albany, and Syracuse, as well as the staff meetings in Platsburgh, and Colonie.
The circuit breaker concept has received significant support as a meaningful relief measure while real school funding reform gets defined.
Congresswoman Kirsten Gillibrand has written a letter to NYS Property Tax Relief Commission Chairman Tom Suozzi endorsing the need for alternative funding for schools to replace the property tax and also supporting the circuit breaker as a temporary relief measure
Frank Mauro, Executive Director of the Fiscal Policy Institute (a research organization that focuses on tax, budget, and economic policy issues in New York State), presented his organization’s research and findings to the Commission. Among his recommendations was replacing the existing STAR Rebate Program with a “circuit breaker.”
School administrators and school board associations also favor a circuit breaker over a property tax cap because with a tax cap - which would limit property tax hikes to a small percentage every year - school districts take huge revenue hits. With a circuit breaker, schools would continue to receive revenue at the same rate, but the money would come
from state income taxes rather than local property taxes.
The Commission is scheduled to publish its preliminary report on May 22, 2008. We do expect the circuit breaker to be one of the key elements for relief to the middle class taxpayers.
Subsequent to that, we will launch a State wide campaign to communicate with and solicit the support of our Legislators in order to get this Bill through this Executive session.
Respectfully Submitted;
Dick Gladu