Large majority wants to keep the cap

by Ken Girardin |  | NY Torch

Screen Shot 2015-05-26 at 2.29.40 PMNearly three-quarters of New Yorkers agree that the property tax cap “has accomplished what was intended” and “should be continued,” according to a Siena Research Institute poll released this morning. But support climbs even higher when respondents in New York City—which was not affected by the property tax cap law—are excluded.

As part of its latest poll on state issues, Siena asked:

Supporters of the property tax cap say it has accomplished what was intended – property taxpayers are not seeing large annual increases in their school or local taxes, as they had in previous years and that´s why the property tax cap law should be continued. Do you strongly agree, somewhat agree, somewhat disagree, or strongly disagree with supporters of the property tax cap?

Siena reported 73 percent of registered voters agreeing with that statement. But excluding respondents from New York City, where the tax cap doesn’t apply, support in the affected parts of the state climbed to 77 percent.

Regionally, the most intense support for the cap was found among voters in the New York City suburbs, where 47 percent of voters said they “strongly agree” that the cap is working and should be continued. As explained in an Empire Center Research & Data Bulletin last week, school tax bills have grown at less than the rate of inflation in the four years since the cap was enacted.

The poll also splashed cold water on efforts to poke holes in the tax cap and make it less effective: 57 percent of the poll respondents outside New York City rejected the claim that the tax cap has forced cuts in programs and services because local governments and school districts “don’t have the ability to raise additional money through the property tax.”

How the cap works

Effective in 2012, the increase in total local property taxes imposed or “levied” by counties, municipalities and fiscally independent school districts in New York State has been capped at 2 percent, or the rate of inflation, whichever is less.  School district taxes and budgets remain subject to voter approval, as they were before the cap—but the cap supersedes the previous state law, which allowed districts, in the case of a budget’s rejection by voters, to impose whatever taxes were necessary to implement a “contingency” plan increasing spending by up to 4 percent, or 1.2 times the preceding year’s inflation rate.

The tax cap law allows counties, municipalities if such an “override” is approved by at least 60 percent of the members of the locality’s governing body, such as city coin cil or town board.  In the case of school districts, the override must be approved by at least of 60 percent of the voters in the annual budget referendum.

However, even a school tax levy increase under the cap requires approval by at least a simple majority of voters. If a proposed school budget (whether over or under the cap) is rejected on its first submission, the school board is allowed just one re-vote, either on the same proposal or some modified version. If the budget fails a second time to win at least a simple majority (if under the cap) or a supermajority (to override the cap), the district’s tax levy is frozen—effectively an absolute cap of zero.

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- Ken Girardin is the Policy Analyst at the Empire Center for Public Policy.