Over the past seven years, New York’s cap on local property tax levies has generated billions of dollars in savings for homeowners and businesses, compared to previous trends. The cap has been especially effective in restraining school property taxes, which have long been the largest and fastest-growing component of New York’s tax burden.

The cap is flexible: its baseline “allowable levy growth factor” of 2 percent or the rate of inflation, whichever is less, is modified by locally variable exclusions and exceptions, and can be overridden by a 60 percent vote of district residents. Nonetheless, advocates of higher school spending contend the law is unduly restrictive. “The tax cap … hurts our poorest districts the most, placing the most severe limits on their ability to raise funds and punishing parents and other taxpayers in low-wealth districts who try to provide more funding for their children,” says the head of the statewide teachers’ union.

A different story emerges from comparison of tax and spending data from 2011-12 to 2018-19. As illustrated in the charts and tables that follow:

  • Spending has risen faster—and taxes have increased more slowly—in low-wealth “high need” districts.
  • Adjusted for enrollment, the average annual tax hike exceeded 3 percent in all but the poorest districts.
  • Thanks largely to exceptions for tax base growth, voter-approved debt payments and a one-time teacher pension cost spike in 2013-14, average taxes for all districts have increased 23 percent faster than the headline “growth factor” would have permitted since 2011-12. 

See interactive school district map at the end of this report for more detailed information.


Under the tax cap law, the allowable levy growth factor has been pegged at 2 percent three times—in 2012-13 and 2013-14, and again in 2018-19. The lowest growth factor was near-zero—just 0.12 percent in 2016-17. Based on the growth factor alone, school tax levies could have risen by a maximum total of 10.9 percent, or about $2 billion, during the cap’s first seven years. The actual increase, as detailed in the table below, has been 13.5 percent, or more than $2.5 billion.

Added growth was made possible by exclusions including increased taxable values attributed to new construction, worth up to $663 million of added taxes, and a one-time spike in teacher pension costs in 2013-14—now worth up to $343 million in added levies statewide, including subsequent compounded growth, even though pension contribution rates have receded to pre-2012 levels. The cap calculation also excludes taxes needed to pay debt service on voter-approved capital projects, which came to $670 million in 2018-19, according to the state comptroller’s office. Overrides have been less of a factor in boosting levies: in more than 4,600 school budget vote cycles since 2012-13, there have been 186 override attempts, 112 of which were approved.

As detailed in the table below, the tax cap worked most effectively to hold down taxes in low-wealth, “high need” districts, which are also favored by the state aid formula. Higher-wealth districts in the low- and average need categories have had to exert significantly greater local tax effort to boost spending to higher rates, despite a roughly 8 percent decline in their enrollments since 2011-12.

screen-shot-2019-03-25-at-10-32-28-am-6840659School District Property Tax Levies and Spending, 2011-12 to 2018-19

About the Author

E.J. McMahon

Edmund J. McMahon is Empire Center's founder and a senior fellow.

Read more by E.J. McMahon

You may also like

Sticker Shock: The Impact of a ‘Single-Payer’ Health Plan on New York Taxes

Proponents of “single payer” health care are pushing New Yorkers to take a multi-billion-dollar leap of faith. Read More

Benchmarking New York

New York State residents pay some of the highest local taxes in the nation. Read More

Tiering Up

New York taxpayers have been hit with enormous increases in pension costs for state and local government employees over the past 20 years. From less than $1 billion in 2000, combined annual employer contributions to the Empire State’s public pension funds escalated to nearly $10 billion by 2010, peaking at nearly $17 billion in 2015. Contributions have leveled off at roughly $16 billion in recent years—but under lenient government accounting standards, even that figure conceals the full long-term cost of generous, locked-in pension benefits for generations of retired government employees.  Read More

Medicaid’s Metamorphosis

A new Empire Center report reveals that the New York Medicaid program now covers more individuals above the poverty line than below it. Read More

Altered State: A checklist for change in New York State

This paper describes seven core objectives and offers specific policy recommendations toward their accomplishment. It’s by no means an exhaustive list, rather a good place to start work towards an Altered State with a growing economy, a more efficient public sector and new opportunities for an engaged and informed citizenry. Read More

New York Property Tax Calculator 2020

As New York and the Nation emerge from the depths of the Covid-19 pandemic and look to the future, many property owners are deciding whether and where to relocate their business or place of residence. Read More

School Budget Spotlight 2021-22

Voters will cast ballots next Tuesday, May 18 on proposed budgets for school districts across New York State. New York State’s highest in the nation average per-pupil expenditure would rise to $28,658 per pupil, an increase of $1,145 per student, or 4.2 percent. Read More

Historic Decline in NY Public School Enrollment?

Preliminary K-12 enrollment data released by the State Education Department (SED) in January suggests that public schools experienced a decline in enrollment of 66,424 K-12 students, or 2.6 percent compared to the 2019-20 school year. That would be the largest since 1981. Read More


Sign up to receive updates about Empire Center research, news and events in your email.


Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100

General Inquiries: Info@EmpireCenter.org

Press Inquiries: Press@EmpireCenter.org


The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.

Empire Center Logo Enjoying our work? Sign up for email alerts on our latest news and research.
Together, we can make New York a better place to live and work!