Tax freeze a gimmick
The proposed two-year freeze on local property taxes, unfortunately, leaves mandate relief out in the cold.
Gov. Andrew Cuomo on Tuesday embraced the proposal from his tax commission to subsidize the cost of the freeze in 2014 with the first state budget surplus since before the Great Recession.
The commission recommended $1 billion, about half of the state budget surplus, be used to freeze local property taxes for two years, but only for municipalities and school districts that abided by the state-imposed cap of 2 percent growth in budget spending. In the second year, only municipalities and school districts that took “meaningful, concrete steps toward finding permanent structural savings” by sharing the cost of services or merging with other entities would be subsidized.
While we are glad to see local property taxes may be held in check, this proposed freeze falls short of addressing the real problem: state mandates. Without reform of New York’s costly Medicaid system, a state-controlled program partially paid for by local property taxes, and without reform of the state’s Taylor Law and its infamous Triborough Amendment, which mandates public employee union contracts never expire until the unions agree to new deals, the governor continues to deny local governments the tools they need to significantly save money, cut spending and lower taxes.
Case in point, last month the Fulton County Board of Supervisors adopted an $85.3 million budget for 2014. According to county officials about 78 percent of the county’s tax levy, set to be $27.3 million, is spent meeting the county’s obligations to nine state mandates.
The proposed tax freeze and Cuomo’s property tax cap law both seem to follow the same logic; if enough pressure is placed on local municipalities and school districts, they will find ways to lower costs or be forced to merge and attempt to save money that way. This approach ignores the fact that local property taxes throughout New York state have risen to unacceptable levels primarily because of policies controlled by state officials and dictated to local officials ill-equipped to fight back against them. While it is a good thing to provide incentives for local governments to find savings wherever they can, the real spending reform must begin in Albany.
Eventually, the state will have to address its mandates if officials truly want to lower the property tax burden in the state.
Until that happens, New York residents probably will be stuck with gimmicks like this two-year tax freeze.