NEWS FROM NEW YORK STATE ASSEMBLY
MINORITY LEADER JAMES N. TEDISCO

Contact: Phil Oliva, (518) 455-3756
Email: tediscj@assembly.state.ny.us
For Immediate Release:
Wednesday, May 16, 2007

Assembly Minority Unveils Historic Property Tax Reform Plan
Plan would end unfunded mandates, limit the amount school districts could hike taxes

Assembly Minority members marked "Tax Freedom Day" Wednesday by unveiling a transformational property tax reform plan they say will give homeowners and businesses significant and lasting relief from the crushing burden of skyrocketing property taxes by eliminating unfunded state mandates to school districts and municipalities, and by limiting the amount school districts can raise tax levies to four percent or the rate of inflation whichever is lower. The plan would save New York homeowners $16 billion over 5 years.

New Yorkers face the highest property taxes in the nation. When measured as a percentage of home value, nine of the top 10 highest property tax rates in the entire country belong to counties in New York. When measured by total median taxes, four of the top 10 highest property tax rates (including 1st and 2nd) belong to counties in New York.

"We were always taught - what goes up must come down. But when it comes to property taxes in New York State that lesson doesn't seem to apply. We are proposing a serious plan that tackles this issue head on because if we don't, more families and businesses will head out," said Assembly Minority Leader Jim Tedisco (R,C,I-Schenectady, Saratoga).

Key components of the Assembly Minority "Property Taxpayer Protection Act:"

  • Limit the amount a school district can increase tax levies to four percent or the rate of inflation, whichever is lower.

  • Require any state mandate (costing more than $10,000 annually or $1 million statewide) that is imposed on a school district or municipality to be paid for by the state.

  • Provide 100 percent reimbursement to schools for costs incurred from 4th and 8th grade Math and English tests.

  • Creates Office of State Inspector General for Education to investigate financial abuse, corruption and misconduct in schools.

  • Consolidates school district paperwork requirements, saving time and money.

  • Supports local option insurance pooling to cut costs.

  • Requires the state to take over the costs of all optional Medicaid services within five years, saving $10 billion.

  • Provides money to counties to buy software for Medicaid fraud investigations.

  • Provides financial incentives and other assistance to localities to consolidate local government services.

"It is part of the American dream to own a home," said Assemblyman Michael Fitzpatrick (R,C,I-Smithtown). "Unfortunately, that dream is becoming a nightmare for many people on Long Island because they are finding it difficult to pay their mortgages and other expenses due to rapidly rising property tax bills. Our property tax cap plan is responsible, equitable, will not harm our schools, and is the right thing to do on behalf of taxpayers."

Massachusetts and, recently, New Jersey have capped local school tax levies so they can only grow by 2.5 to four percent. Now, Connecticut is considering a three percent cap. In the 1980s Massachusetts had the highest property taxes in the nation but now after enacting "Proposition 2 " they are ranked 32nd in property taxes nationwide and their educational system is presently one of the top five educational systems in the United States according to Morgan Quitno Press, a private research firm.

"In Suffolk County, much like most of the state, property taxes continue to grow with no end in sight," said Assemblyman Fred W. Thiele, Jr. (R,I,C-Sag Harbor). "Some people have no choice but to leave their homes, their families and their friends behind because they simply can no longer afford to live here. It is time that the state passed meaningful property tax reform. The system needs an overhaul, and that must begin with a spending cap. Without such measures in place, taxes will continue to rise and people will continue to leave to escape the ever-increasing burden."

"As Chairman of the Assembly Minority Small Business Task Force, I have traveled the state, listening to the concerns of small and family-owned businesses," said Assemblyman Bill Reilich (R,C,I- Greece). "High taxes are often their number one concern. The New York State Property Taxpayers Protection Act will put a stop to skyrocketing property tax increases, ensuring that these local employers can afford to stay in their communities."

"We commend the Assembly Minority for focusing on the need for property tax reform," said John Whiteley, Steering Committee Member and Spokesman for Tri-County Committee for Property Tax Relief. "There are many good ideas in the package. Paramount among them is the elimination of most unfunded state mandates, which would make it realistic and appropriate to also place a limit on the growth of local school tax levies as proposed."

"We would like to thank the Assembly Minority for finally bringing Real Property Tax Reform to the forefront," said Peter Brothers, Committee Member for Queensbury Property Owners for Tax Equity. "There are a number of things we can do to help reduce the tax burden: cut government spending, require federal and state governments to pay for the mandates they impose on local counties and municipalities, and stop shifting tax burdens with new government programs that only serve as gimmicks without addressing the problem. We feel today is a good start but we must continue to rapidly move forward because homes are at risk."

Property tax rates have continued to skyrocket even as state spending on education continues at a record pace. School aid provided for the 2007-08 school year was increased by a record $1.76 billion or 9.8 percent, over 2006-07, for a total of $19.65 billion. Even with this record increase, the majority of school districts statewide proposed property tax increases for their 2007-08 budgets. State school aid provided to education over a five year period from 2003-04 to 2007-08 (at time of enactment) increased by $5.22 billion or 36.17 percent.

In addition to the record amount of school aid provided for the 2007-08 school year of $19.65 billion; the state also provided $1.3 billion in Middle Class STAR Rebate Checks and $3.5 billion in traditional Basic and Enhanced STAR exemptions for a total of $4.8 billion in STAR savings for 2007-08.

"The STAR program was intended to provide homeowners with relief. The STAR program and the rebate checks last year and this year are indeed welcome relief but unless we address the root causes of the problem property tax bills will continue to hang over the heads of homeowners like Damocles' Sword," said Tedisco.

New Yorkers worked 4 months, from January 1 to May 15, to earn enough money to pay this year's tax obligations at the federal, state and local levels. Tax Freedom Day symbolizes the day when those debts are paid in full.

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Data based on property taxes by County Nationwide:

Median Property Taxes Paid on Homes
County State Total Rank
Westchester County NY $7,337 1
Nassau County NY $7,025 2
Hunterdon County NJ $6,988 3
Bergen County NJ $6,846 4
Essex County NJ $6,642 5
Rockland County NY $6,527 6
Morris County NJ $6,478 7
Somerset County NJ $6,465 8
Putnam County NY $6,335 9
Union County NJ $6,312 10

Taxes as % of Home Value

Median Property Taxes Paid on Homes
County State Total Rank
Niagara County NY 2.8% 1
Monroe County NY 2.7% 2
Onondaga County NY 2.6% 3
Wayne County NY 2.6% 4
Chautauqua County NY 2.6% 5
Fort Bend County TX 2.6% 6
Erie County NY 2.5% 7
Schenectady County NY 2.5% 8
Cayuga County NY 2.4% 9
Chemung County NY 2.4% 10

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