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A06436 Summary:

COSPNSRPalmesano, Raia, Crouch, DiPietro, Lawrence, Morinello, Barclay, Giglio, Blankenbush
MLTSPNSRButler, Walsh
Add 1527-a, amd 2022 & 3602, Ed L; add 431, 431-a & 901, amd 1573, RPT L; add 25, Gen Muni L
Relates to the school property tax reduction act; establishes the blue ribbon commission on property tax reform; relates to state assistance for local real property reassessment, state assistance to assessing units within a school district, providing a fixed real property assessed value for residential real property owned by certain persons over the age of 65 and providing state reimbursement to municipalities for lost real property tax revenue; and relates to requiring the state to fund certain programs mandated for municipal corporations or school districts.
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A06436 Memo:

submitted in accordance with Assembly Rule III, Sec 1(f)
SPONSOR: Brabenec (MS)
  TITLE OF BILL: An act to amend the education law, the real property tax law and the general municipal law, in relation to school property and real property taxes   PURPOSE OR GENERAL IDEA OF BILL: The purpose of this legislation is to require the state to pay for new or expanded state mandates, allow school districts to opt into a phased in state takeover of their real property tax levy, and to freeze the assessment and the tax rates for senior citizens over the age of 65.   SUMMARY OF PROVISIONS: Section 1 of the bill adds a new section 1527-a to the education law to prohibit any unfunded mandate, with certain exceptions, which creates a net additional cost to any school district in excess of $10,000 or in an annual aggregate net additional cost to all school districts exceeding one million dollars. Section 2 of the bill amends section 2022 of the education law and Section 3 of the bill amends section 3602 of the education law to provide school districts the right to enter into an optional system of state funding for school district expenses, whereby the state would assume one hundred percent of the residential real property tax levy, to be phased in over a period of five years. Section 4 of the bill adds a new section 431 to the real property tax law to freeze school tax rates on residential real property owned and occupied by individuals sixty-five years and older. Section 5 of the bill adds a new section 431-a to the real property tax law to freeze the assessment on residential real property owned and occupied by individuals sixty-five years of age and older. Section 6 of the bill adds a new section 901 to the real property tax law, which requires the state to reimburse school districts for any lost property tax revenue resulting from freezing the property tax levy or assessment for senior citizens. Section 7 of the bill provides state aid to municipalities when they bring their assessments to one-hundred of fair market percent value. Section 8 of the bill requires the state to fund all Mandates on all municipalities, with certain exception. Section 9 of the bill creates a blue ribbon commission on property tax reform to examine the current property tax system and local education financing system of the state. Section 10 provides that the act will take effect April 1, 2017.   JUSTIFICATION: Excessively high property taxes are a serious issue in the state of New York. Indeed, New York has one of the highest average property tax rates in the country, with only three states levying higher property taxes. According to the independent nonpartisan Tax Foundation, the median U.S. property tax is $1,917 per year. In New York State, the median property tax is $3,755 per year, ninety six percent higher than the national median. Furthermore. the median yearly property tax paid by New York residents amounts to approximately five percent of total yearly income. New York ranks as the 6th highest among the 50 states for property taxes as a percentage of median income. Property taxes thus represent a significant financial cost to persons across the state, and lowering property taxes, or avoiding property taxes can result in substantial savings. These property taxes are felt at an even more significant level by the state's senior citizens. Due to the reduced or fixed income levels, property taxes for senior citizens represent a regressive tax; and thus these taxes impact seniors disproportionately when compared to other property owners. funding local school districts. This bill requires the State to pay for any new or expanded state mandates, grants school districts the option to have the State pick up the entire cost of the local school tax levy, and caps property taxes for senior citizens, thus providing an important step toward the reduction of the property tax burden upon the tax payers of New York, especially those most vulnerable to the tax.   PRIOR LEGISLATIVE HISTORY: New bill.   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: New York State would be required to pay for all new and expanded State mandates, with certain enumerated exceptions. In addition, New York State would be required to phase-in the payment of all real property tax levies for school districts that opt into the state-funded program. Finally, the State would pay school districts for any lost revenues attributable to capping the tax rate and assessment for senior citizens.   EFFECTIVE DATE: The bill would become effective on April 1, 2017.
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