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Most favor permanent property tax cap

Nearly 60 percent of respondents to this week’s RBJ Daily Report Snap Poll say New York’s property tax cap should be made permanent. Another 31 percent would support that move if it were tied to mandate reform.

In effect since 2012, the tax cap does not expire until 2016, but the enacted legislation was tied to rent-control regulations in the New York City area that are due to sunset this month. The state Senate recently approved a bill that removes that link and extends the tax cap permanently.

A group of employer organizations including the Business Council of New York State Inc. has launched a push for a permanent tax cap. The group points to data compiled by the Empire Center showing that New York property owners have saved $7.6 billion (with $490 million saved in the Finger Lakes region), compared with the amount they would have paid if school tax levies had grown at the 30-year average rate of 6 percent a year. Instead, the levies have increased an average of 2.2 percent annually.

Under the law, the increase in total local property taxes imposed by school districts in New York is capped at the lesser of 2 percent or the rate of inflation. A district can override the cap if at least 60 percent of budget voters approve. The law also allows certain exceptions—for example, adjustments to reflect changes in taxable property values due to new construction or property improvements.

Gov. Andrew Cuomo, who has termed New York’s property tax cap a “tremendous success,” wants it to be made permanent. But critics of the tax cap say it limits local control and should be coupled with mandate reform.

“The tax cap limits the ability of school districts to raise local revenue at the same time districts are asked to offer more programs and provide more resources for their students,” the New York State School Boards Association has argued.

Approximately 500 readers participated in this week’s poll, conducted June 1 and 2.

Should New York’s property tax cap be made permanent?
Yes  59% 
Only if tied to mandate relief  31%
No  10%

Gov. Andrew Cuomo has termed New York’s property tax cap a “tremendous success.”
Do you agree?
Agree strongly  16%
Agree somewhat  55%
Disagree somewhat  15%
Disagree strongly 14%

For information on how the Snap Polls are conducted, click here.

COMMENTS:
Mandate relief should be made part of this, but in the absence of such a link, the tax cap should be made permanent anyway. Not all of the excessive tax increases were due to state and federal mandates; in fact, the majority was due to fiscal abuse at the local level. It’s always easy to spend O.P.M. (other people’s money). The property taxes in New York are so high, that even a 2.2 percent increase each year is too much until tax rates become more competitive with other states. Otherwise, high-income taxpayers will continue to leave the state in record numbers.
—John Midolo, managing partner, RCM Strategies LLC

The property tax cap should also extend to county and local government property taxes. Where does all the money go? There isn’t any itemized accountability to what is being paid and to whom. Then we read about the corruption in the county governments, favoritism in the local governments, ticket-fixing in the police department. Monroe County has the highest taxes as a percentage of income in the U.S. Cap the taxes! This keeps people from owning property. Governments need to be accountable to the taxpayers who are paying the expenses. Governments seem to feel that they have an open pocketbook from the taxpayers, charge whatever they want, without accountability. This needs to change.
—Jennifer Apetz

It would be nice to have a permanent cap, but not realistic. However, there’s time before it expires for true tax reform and streamlining regulations to be put into place. The process needs to start locally to improve government processes as a whole so cost savings can be realized throughout government. We have to stop looking each entity up the food chain to pay for the poor operations of local government. The default is always “the state or federal governments will help.” We’re the ones who fill the state and federal coffers!
—Jeffrey Galvin

We don’t have a taxing problem; we have a spending problem. Fix the second, and the first will take care of itself.
—Jeff Luellen

The law as written is too weak. Taxing entities view it as optional and frequently override it. Without limiting state mandates, it cannot succeed.
—Jim Weisbeck, Bloomfield

By all means keep the property tax cap. Finally a partial solution to school districts ever-increasing school tax increases.
—Peter Bonenfant

The tax cap barely scratches the surface of getting taxes under control. Until we get taxes more in line with other states, people will continue to vote with their feet and move. New York State is not open for business; they dare you to open a business!
—Frank DeCiantis

We really need property tax reduction, not growth at 2 percent. To do this we should have some mandate relief and require school districts not compensate any of their employees with more money than the governor’s salary. Excessive salaries are indicative of disregard of taxpayers’ money.
—David Rubin

Schools need to rein in spending on non-essential capital expenses such as fancy new sports fields and lighting. These expenses do nothing to contribute to the quality of education.
—Frances Reese, Reese Environmental Consulting

My view is it is a step in the right direction. It will become useless unless tied to mandate relief, otherwise: “You give with one hand and take away with the other.”
—J.A. DePaolis, Penfield

The effect of the tax cap has caused smaller municipalities to deplete fund balances, which in turn has caused reduction in employees and services, and also has caused the ratings services to lower bond ratings, which in turn raises the cost of borrowing. Furthermore, the bond companies have requested—because of the critically low fund balances—that the municipalities raise taxes, thus defeating the purported purpose of the tax cap. More “feel-good” legislation by our state lawmakers rather than actual cutting of taxes and mandates.
—Charles Genese

6/5/15 (c) 2015 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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