The state’s new 2 percent property tax cap could be exceeded in hundreds of communities next year after a double-digit rise in public employee pension costs, which are exempted from the limit.
Taxpayer-financed pension charges overall will increase an average of 16 percent for non-uniformed employees and 19 percent for police and firefighters in figures announced Wednesday by Comptroller Tom DiNapoli.
“My initial reaction is, ‘Well, there goes the tax cap,’ ” said Peter Baynes, executive director of the state Conference of Mayors.
The increase should fall especially hard on cities and towns that have their own police and fire departments, which typically make up a large chunk of total payroll.
In the Capital Region, that includes Albany, Schenectady and Troy as well as suburban towns like Colonie, Guilderland and Bethlehem.
The city of Albany will need an additional $2.7 million next year for pension increases alone, Treasurer Kathy Sheehan estimated.
DiNapoli said municipalities on average will have to increase their annual pension contribution rates from 16.3 percent to 18.9 percent of payroll for the 2013 payment. For police and firefighters, who have a more generous pension system, the payment will go from 21.6 percent to 25.8 percent of payroll.
Instituting a cap on how much a municipality’s tax levy could rise each year was a priority for Gov. Andrew Cuomo during this year’s legislative session. He successfully pushed through a cap of 2 percent or the rate of inflation, whichever is lower.
A levy that exceeds the cap requires a 60 percent or greater vote by citizens in the taxing district.
And an exemption was granted for public sector pension costs, which are rising sharply and are constitutionally guaranteed. Critics said the exemption amounts to a loophole….
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M Read More
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No doubt, the Health Department and the governor would like this report to be the final word on the subject.
But if it’s all the same with them, we’d still like a truly independent review. Read More