In recognition of New York State “Tax Freedom Day,” Assemblyman Michael Fitzpatrick (R,C,I-Smithtown) and the Assembly Minority Conference unveiled legislation to limit the property tax burden placed on homeowners and businesses. The “Property Taxpayer Protection Act” would provide measures to control spending and cap tax levy increases to slow the dramatic increase in property taxes.
“Rising property taxes have eroded our competitive edge, and forced over a million residents to flee the state over the past seven years,” said Fitzpatrick. “We need to fundamentally change our property tax system by providing the necessary initiatives to alleviate the tax burden, limit unfunded mandates, and rein in spending.”
The Property Taxpayer Protection Act provides for real property tax reform and relief by controlling spending and relieving school districts of unfunded mandates. The bill, which would save taxpayers $16 billion over five years, would prevent school district property tax levies from increasing by more than 4% each year or the rate of inflation, whichever is lower, and allow voters to override the limitation through a 2/3 vote. The bill will also require the state to fund any mandate imposed on a locality costing more than $10,000 annually or $1 million statewide. It also provides 100% reimbursement to schools for costs incurred from 4th and 8th grade Math and English tests, beginning in the 2008-09 school year.
In addition, the legislation would lower county Medicaid costs and address financial accountability and transparency. Under the measure, the state would take over all costs of optional Medicaid services, and provide money for counties to buy software for Medicaid fraud investigations. An Office of Inspector General for Education would also be created to investigate financial abuse, corruption, and misconduct in schools and require that the fiscal impact of each bill be available to legislators before a vote.
In order to reduce local government reliance on property taxes, and provide localities with the assistance and incentives they need to work more effectively, Metro-STAR provides $30 million in grants to research the efficiency of mergers or consolidations of local governments that help reduce the tax burden on homeowners. To encourage consolidation of local services, $30 million in Metro-STAR grants will also be allocated.
Modeled after the successful Proposition 2 ½ in the Commonwealth of Massachusetts, the Property Taxpayer Protection Act looks to similar results. While Massachusetts once had the highest property taxes in the nation, the adoption of measures like the property tax cap has improved their ranking to 32nd. More importantly, limiting the growth of property taxes did not endanger education as Massachusetts, currently, is recognized as having one of the top five education systems in the nation.
“What once was a dream to own a home is now a nightmare,” said Fitzpatrick. “Long Islanders have been screaming for help in alleviating their tax burden. Now is the time to take a serious look at what must be done. Requiring the state and school districts to live within a budget is a good start.”