Your Dec. 13 editorial “New York State of Tax” is right on the mark, with one major exception. Gov. Andrew Cuomo‘s property-tax cap isn’t, as your editorial claims “filled with loopholes that many towns have exploited.” The only significant exclusions from the cap are for a portion (and only a portion) of any extraordinary increase in pension bills, set at a level so high it will rarely be triggered, and for debt service on school-district capital projects approved by voters. An allowance is also made for added taxes generated in any given year by physical additions to the property-tax base. This clause is expressly intended to give municipalities an incentive to favor much-needed new development.

Mr. Cuomo’s tax-levy cap, modeled closely on the successful Prop. 2.5 cap in neighboring Massachusetts, is much tighter and more effective than, for instance, Gov. Chris Christie’s tax cap in New Jersey. Two years after its enactment, the New York cap is clearly making a difference—especially in school districts, where a cap override requires a supermajority vote of 60% of taxpayers. Because it is set at the lesser of 2% or inflation, the cap will range from 1.6% to 1.7% for most municipalities in 2014.

Unfortunately, Mr. Cuomo so far has been unwilling to combine the tax cap with meaningful local-mandate relief, especially public-sector collective-bargaining reforms that would give county executives, mayors and school boards more tools to live within the cap.

What New York needs now is lower local costs, not new state-subsidized giveback gimmicks in the name of “property-tax relief.”