December 11, 2013

State Tax Relief Commission report yields ideas

Local, state leaders hope proposals can help individuals, businesses


---- — PLATTSBURGH — The State Tax Relief Commission’s final report offers several measures that could benefit North Country residents, including a two-year tax freeze.

“Taxes are crushing all New Yorkers, and any legitimate tax relief in any form by the governor will be much appreciated,” City of Plattsburgh Mayor Donald Kasprzak said.

Gov. Andrew Cuomo’s Tax Relief Commission report was issued Tuesday. 


Chaired by former Gov. George E. Pataki and former Comptroller H. Carl McCall, the commission offered five key recommendations for lowering the tax burden on individuals and businesses and helping to spur economic growth.

▶ A two-year freeze on property taxes for homeowners in municipalities that meet the state’s 2 percent tax cap.

The state would provide a tax rebate equal to the amount of the increase in a homeowner’s tax bill, which would effectively freeze taxes for them at their 2014 levels for two years.

▶ A program that would target real-property tax relief based on an individual homeowner’s ability to pay.

Given that tax burdens decrease as income rises, a relief program could be structured to provide a greater proportion of benefits to those with the highest burdens as a share of their income, the report said.

This idea is also known as a “property-tax circuit breaker.”

▶ Tax relief for businesses in the form of combining the corporate-franchise and banking-franchise taxes and lowering the corporate income-tax rate from 7.1 to 6.5 percent.

▶ Accelerate the elimination of a utility surcharge.

The 18-A surcharge is slated to be phased out by 2018, but the commission recommends it be taken out now.

The surcharge can amount to as much as $30,000 per year for some large businesses, up to $540 for small businesses and up to $55 per year for individuals.

▶ Reform estate taxes.

The plan would reduce the top estate tax from 16 to 10 percent.

It also suggests increasing the state’s estate-tax exemption from $1 million to $5.25 million, the same as the federal standard.


The governor said the commission’s report is another effort by the state to improve the quality of life for all New Yorkers.

“For far too long, property taxes have been a crushing burden on New York homeowners and businesses, hurting job growth and driving individuals and families from the state,” Cuomo said in a news release.

“I look forward to working together with the legislature to review these recommendations and continue our efforts to reverse the state’s reputation as a tax capital and make New York a friendlier state for families and businesses.”

State Sen. Betty Little (R-Queensbury) said the circuit-breaker idea is one she has been pushing for several years.

“Several similar proposals have been proposed in the legislature in recent years, so much of the work has been done on developing the concept,” she said.

“The point is to direct more of the relief to those most needing it, such as seniors living on fixed incomes who are unable to afford to pay high property taxes.”

Little said the state needs to continue to find ways to provide more mandate relief and other ways to reduce the tax burden.

“But this (circuit breaker) is a measure that would help now and target those whose property-tax bills are exceeding their ability to pay,” she said.


Essex County Board of Supervisors Chairman Randy Douglas (D-Jay) said the commission’s recommendations should help local governments compile better budgets.

“It might be an incentive for people to try to meet the cap,” he said.

He noted that the Town of Jay has produced budgets that have increased an average of only 1.75 percent in the past nine years. It appears, however, that the county will not be able to meet the state cap for its 2014 budget.

Essex County supervisors are looking at a 15 percent tax-levy increase; that would require a majority vote to override the cap.

“We may not do it (meet the tax cap) at the county level until we stabilize our budgets,” Douglas said.

Clinton County Legislature Chairman Jimmy Langley (R-Area 7, Peru) said he hopes the recommendations become reality in the state’s 2014 budget.

“Over the last two years, we have seen the governor lead real action to rein in spending and lower taxes for the middle class,” he said.

“Adding to that is (Tuesday’s) report, a report that encourages government to build on these sacrifices to further create the type of environments where both businesses and families can flourish.”


The New York Farm Bureau especially likes the idea of increasing the threshold for the estate-tax exemption to $5.25 million.

“It isn’t difficult for farms in New York to hit the current $1 million threshold when the values of land, livestock and equipment are taken into account,” Farm Bureau President Dean Norton said in a statement.

“The change would prevent most families from having to sell off pieces of a farm that may have been in the family for generations just to pay the tax bill should a death occur.”

Assemblywoman Janet Duprey (R-Peru) said the commission report is a good start but more still needs to be done.

“My initial review of the report is positive,” she said. “Clearly, property taxes in New York have been an increasing burden on business and residential property owners for years, so providing incentives to local governments for holding the line on taxes should prove beneficial.

“However, we also need to be aware that local municipalities and schools have exhausted much of their fund-balance reserves, so it will be critical for the state to work with local officials to assure adequate services continue.”

Little said the report recommendations will likely become part of the budget discussions when work on the 2014 spending plan begins early next year.

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