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Cuomo getting significant pushback on tax cap

Jan 25, 2011 11:18 am
The Times Union reports that the governor said that the increasingly popular circuit breaker mechanism for capping local property tax payments -- a graduated means of lessening tax burdens based on incomes that seems to be a growing favorite of state legislators -- served a "different purpose" than his proposed two percent property tax cap that didn't instill "fiscal discipline for the local governments where spending is out of control." "The rate of spending is unsustainable -- that is a fact," Cuomo said. "We cannot sustain it here on the state level or on the local level. A circuit breaker will say, well, you can't sustain it for some people. No, you can't sustain it for any people."

Pushing back against Cuomo's campaign for a basic two percent cap on property taxes, several groups and their legislative allies are saying a cap should be paired with an extension of rent regulations or the use of income taxes to ensure less relief for the wealthy and more relief for lower-income people. Under Cuomo's plan, a school district or municipality's property tax levy couldn't increase more than 2 percent or the rate of inflation -- whichever is less -- excluding payments for capital construction or legal settlements.

A growing number of legislators are pushing for the addition of the "circuit breaker" that would provide some level of relief for people with lower incomes. One measure, supported by the New York State Property Tax Reform Coalition, would offer a 70 percent rebate of property taxes that reached above a certain percentage of household income -- 8.5 percent or less, after a few years. And yet few seem willing to go up against the governor head to head on the issue... at least yet.

Cuomo has an impressive coalition supporting his cap, including the Committee to Save New York, a coalition of business groups and major Manhattan real estate owners that is airing television advertisements and doing other "public education" in support of a cap. That campaign was conceived as a counterpoint to many public-sector labor interests that will lobby against the tax cap. One such group, New York State United Teachers, pledged this weekend to spend $425,000 to fund organizers at the Alliance for Quality Education.

Cuomo has begun traveling the state hoping to associate his own popularity with local legislators who stand with him. But still, many lawmakers who oppose the cap remain unconcerned and are holding firm.

A few weeks ago, Columbia and Greene county Assemblyman Pete Lopez questioned whether the 2 percent cap plan was more than a "sound bite" and asked to see more meet to the governor's proposals, including mandate reliefs and something akin to the circuit breaker, if not it. He said he was awaiting grater details in Cuomo's upcoming budget proposal, expected in the coming weeks.

Many are expecting a property tax cap to fail in the state Assembly, which remains dominated by New York City Democrats whose constituents do not face the same sort of property tax issues as residents Upstate.