Panel chairman says failure to control rising property levies causes residents and businesses to leave

RICK KARLIN Capitol bureau
Section: Main,  Page: A1

Date: Tuesday, June 3, 2008

ALBANY - A state commission said Monday the surest way to ease New York's property tax burden is to cap at 4 percent the increase school districts can levy each year.

The panel also suggested linking tax breaks to income under the state's School Tax Relief program and making it tougher for teachers unions to hold out for a better deal during contract negotiations. The study's main author, one-time gubernatorial aspirant and Nassau County Executive Tom Suozzi, however, made it clear that without a tax cap, the other suggestions by his state Commission on Property Tax Relief, which released its preliminary report on Monday, would be for naught.

"The property tax cap is the first thing that must be done. Nothing else will happen unless you do the property tax cap," said Suozzi.

Noting that New York's property taxes are 79 percent above the national average, Suozzi said the need for a cap, preferably this year, became clear as he traveled the state gathering testimony.

"Real people are suffering in New York state. People are leaving the state. People are leaving their hometowns. Businesses are closing up," he said.

The state's three political leaders, Republican Senate Majority Leader Joseph L. Bruno, R-Brunswick, Assembly Democratic Speaker Sheldon Silver, D-Manhattan, and Democratic Gov. David Paterson had no immediate comment for or against the report and its call for a tax cap.

Silver has previously said he supports a tax cap but isn't ready to look at one this year. And the New York State United Teachers, a major campaign donor that can launch significant get-out-the-vote efforts for or against candidates at election time, opposes a cap, which it says would hurt education.

"If you look at it as a whole, this is basically an anti-education move," said NYSUT President Richard Iannuzzi, who noted that some of the suggestions to change rules surrounding labor negotiations are aimed at teachers in particular. His opposition to a cap was echoed by the state School Boards Association and Working Families Party.

In response, Suozzi, a Democrat, said New Yorkers have become so upset by school taxes that discussions of education quality are getting lost in the process. The panel was commissioned by former Gov. Eliot Spitzer.

The call for a tax cap could emerge as a potent election year issue if either the Republican-controlled Senate or Democratic Assembly is viewed as supporting or blocking such a move. Senate Republicans, whose political base is in highly taxed suburbs and rural upstate regions, may have the most to gain from a tax cap push. Assembly Democrats, on the other hand, are dominated by lawmakers from New York City, where property taxes are proportionately much lower since they also use city income taxes to support their schools.

Much of the report focuses on school taxes since they make up an average 62 percent of the property tax burden in the state.

Commission members will issue a final version of the report in December.

Here are some of the key recommendations so far:

Limit property tax levies, or the amount collected from property owners in a taxing district, to 4 percent per year or 120 of the Consumer Price Index, whichever is less. If the maximum levy wasn't used, the difference could be "banked" and used in future years, though it could not increase the levy more than 1.5 percent from one year to the next.

Districts whose budgets were under the cap wouldn't have to hold an annual vote. A district could exceed the cap with 55 or 60 percent of voters, depending on how much state aid they get.

Change STAR to tie exemptions to income. STAR exemptions, which lower the taxable value of a home, now have no link to income, so multimillionaires can get automatic property tax breaks. Two lawmakers, Assemblywoman Sandra Galef, D-Ossining, and Sen. Betty Little, R-Queensbury, are currently calling for a circuit breaker, which would provide income tax breaks for homeowners who pay a significant portion of their income toward property taxes. But the commission didn't elaborate on income thresholds which might trigger the tax break.

Mandate reform, including the exemption of teachers from the Triborough amendment. The Triborough amendment states that when a public employer and its employees union - including teachers unions - can't agree on a contract, existing contracts remain in place. That frequently gives the union a great advantage due to the automatic longevity increases, or steps, most teachers get annually for 20 years or more. Steps give most teachers raises even if there is no contract, allowing unions to hold out longer to settle a disputed labor contract.

While leading politicians held back from commenting on Monday, some of the state's think tanks were quick to weigh in.

Frank Mauro, executive director of the liberal Fiscal Policy Institute, which is partially funded by labor unions and has close ties to NYSUT, opposes a cap.

"The most essential thing is the circuit breaker," he said.

Edmund J. McMahon, director of the Empire Center for New York State Policy, which is part of the conservative Manhattan Institute, praised Suozzi's suggestions.

"It puts forward some strong ideas in a very compelling way and it puts the Legislature on the spot," he said.

Rick Karlin can be reached at 454-5758 or by e-mail at

To view the full report, go to: http://blogs.timesunion .com/capitol/