Is New York's property tax cap sustainable for long term?
The future of the state’s property tax cap is one of the big items on the docket as state lawmakers head back to Albany to finish up the current session. Supporters of the tax cap, including business groups, Republicans in the state Senate and Gov. Andrew Cuomo, are pushing to make the tax cap permanent.
Syracuse-area Assemblyman Bill Magnarelli thinks the tax cap has worked.
"I think it has been successful in keeping property taxes down,” said Magnarelli.
But he also says the tax cap, which limits local governments and schools from raising taxes beyond 2 percent, or the rate of inflation, might not be sustainable in the long term.
"Once some of the school districts in particular and municipalities start going into their fund balance, then the rubber’s going to hit the road, and we’re going to have to figure out what to do,” he said.
At that point he expects lawmakers would have to consider more state aid for schools and local governments.
Magnarelli admits property taxes are too high and are holding the state back.
“We’ve got to kind of transition ourselves off of that way of taxing," he said. "I’m hopeful that someday we’ll see a reformation of the state income tax so it would be fairer, and hopefully produce the kind of revenue that is needed to keep our local governments and school districts moving.”
The current tax cap legislation will sunset next year. But lawmakers are considering it this year, because it’s linked to New York City rent control laws, which are set to expire next month.