Property Tax Circuit Breaker Now

Robert McKeon, an executive committee member of the New York State Coalition for Property Tax Reform and director of The Tax Reform Effort of Northern Dutchess (TRENDNY.org), wrote in his "Valley Views" op-ed piece in the Poughkeepsie Journal January 17th ("Property Tax Cap Wouldn't Be Much Help") the following regarding the need for a real and common-sense solution to skyrocketing school property taxes:

"A better opening act might be to adopt circuit-breaker legislation that would limit what an individual would be required to pay, such as the Galef/Little bill (A.1575/S.1053). It calls for homeowners to be reimbursed for school taxes that exceed a certain percentage of their income."

The fact is that this truly bipartisan legislation (A.1575/S.1053) is co-sponsored not only by Republican State Senator Elizabeth Little-- but also by fellow Republican State Senators James Alesi, Martin Golden, Serphin Maltese, George Maziarz, and James Wright-- as well as some Republicans in the Assembly.

If you agree, sign on to this petition, contact the Governor and our state legislators toll-free at (877) 255-9417, and contact our County Legislature at [email protected] and [email protected] to get the resolution submitted January 17th by yours truly passed.

For more information on this see below-- and the December 13th testimony of Fiscal Policy Institute Executive Director Frank Mauro before the NYS Division of the Budget Public Hearing on Property Taxes here:
http://www.fiscalpolicy.org/DOBHearingDecember132007.pdf; also legislative bill memos here:
http://www.assembly.state.ny.us/leg/?bn=A1575;
http://www.assembly.state.ny.us/leg/?bn=S1053.

Joel Tyner
County Legislator
Clinton/Rhinebeck
324 Browns Pond Road
Staatsburg, NY 12580
[email protected]
(845) 876-2488

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[text here below of resolution submitted by yours truly on this]

WHEREAS, given the increased reliance on the real property tax for local government revenue, many homeowners are facing skyrocketing real property tax bills and as a result are often faced with the threat of defaulting on their property taxes or being forced out of their homes, and

WHEREAS, the Middle Class STAR rebate program is better targeted than the original STAR exemption program in that in takes income into consideration, but it is still not adequately targeted to be an effective and efficient property tax relief mechanism since it does not take the size of a homeowner's property tax bill into consideration, and it is still based on county and school district average of important variables, and

WHEREAS, A.1575/S.1053, bipartisan legislation for a property tax circuit breaker program, co-sponsored by Assemblymember Sandy Galef and State Senator Elizabeth Little, would address both of these shortcomings; the legislation applies to homeowners who have lived in their current homes for at least five years and who have incomes of below $250,000, and

WHEREAS, under A.1575/S.1053, the estimate of the maximum credit in the income range below $50,000 to $75,000 was about nine thousand dollars; these numbers and the differences between the mean and the median credits indicate that many households have very large property tax bills relative to their incomes, and

WHEREAS, the STAR program is providing aid to many households for whom property taxes are a very reasonable percentage of income, while the aid being provided is not sufficient to assist those
who are truly overburdened by property taxes and who in the words of Governors Pataki and
Spitzer are literally being forced out of their homes, and

WHEREAS, the middle class STAR program is a step in the right direction by taking household incomes into consideration, but unless the size of households property tax bills are also taken into consideration, more aid will still go to households with reasonable property tax burdens relative to their income, and not enough aid will go to those who are truly overburdened, and

WHEREAS, the STAR is more costly than it needs to be, given the limited amount of relief that it is
delivering to those who are truly overburdened by property taxes; this is because it gives a little bit of relief to all homeowners-whether or not their property taxes are high relative to their needs, and

WHEREAS, since STAR provides relief to homeowners based on county averages, the amount of
relief that particular homeowners receive is not related to their property tax bills, or their incomes, or, ideally, the relationship of their property tax bills to their income; as a result STAR violates both of the basic principles of tax fairness, and

WHEREAS, STAR violates the principle of "horizontal equity" because it does not give the same amount of relief to two taxpayers with the exact same incomes and the exact same property tax bills if they happen to live in different parts of the state; STAR also violates the principle of "vertical equity" because two homeowners in the same school district, one with a much higher property tax bill relative to his or her income than the other, both receive the same dollar benefit, and

WHEREAS, the STAR program distributes aid to school districts in a way that undercuts the
equalizing nature of the school aid system; under STAR, state aid is provided to school districts
not on the basis of enrollment and student need but on the basis of the number of owner-occupied primary residences in the school district, the median home value in the county or counties in which the school district is located, and the school district's property tax rate, and

WHEREAS, more effective and efficient property tax relief can replace the Middle Class STAR program with a real property tax circuit breaker that targets aid to those who are the most overburdened by their real property tax bills, and

WHEREAS, A.1575/S.1053 adds a new subsection (qq) to section 606 of the tax law to provide for a real property tax credit; the credit to be based on the income of the household and the percentage that said household pays for real property taxes for the counties of Dutchess, Putnam, Orange, Nassau, Rockland, Suffolk, and Westchester counties and New York City as follows: for households with adjusted gross income of $120,000 or less, real property taxes paid in excess of 6\% of said income would receive a personal income tax credit of 70\% of the overage; for households with adjusted gross income of $120,001 to $175,000, real property taxes paid in excess of 7\% of said income would receive a personal income tax credit of 70\% of the overage; for households with adjusted gross income of $175,001 to $250,000, real property taxes paid in excess of 8\% of said income would receive a personal income tax credit of 70\% of the overage, and

WHEREAS, A.1575/S.1053's real property tax credit for New York homeowners in other parts of the state would be based on the income of the household and the percentage that said household pays for real property taxes as follows: for households with adjusted gross income of $90,000 or less, real property taxes paid in excess of 6\% of said income would receive a personal income tax credit of 70\% of the overage; for households with adjusted gross income of $90,001 to $150,000, real property taxes paid in excess of 7\% of said income would receive a personal income tax credit of 70\% of the overage; for households with adjusted gross income of $150,001 to $250,000, real property taxes paid in excess of 8\% of said income would receive a personal income tax credit of 70\% of the overage, and therefore be it

RESOLVED, that the Dutchess County Legislature requests that the New York State Legislature pass and Governor sign into law A.1575/S.1053, and be it further

RESOLVED, that a copy of this resolution be sent to Governor Eliot Spitzer, State Senator Vincent Leibell, State Senator Stephen Saland, and Assemblymembers Greg Ball, Kevin Cahill, Thomas Kirwan, Joel Miller, and Marcus Molinaro.