As demonstrated by the latest budget gimmicks — $83 million in “fees” in the 2017 proposed budget— Nassau County Executive Edward Mangano and the county Legislature will go to great lengths to avoid increasing property taxes.
The reason stated is that property taxes are too high in Nassau County.
Though the argument sounds reasonable, it is undermined somewhat by the fact that school budgets, which generally account for two-thirds of homeowners’ property taxes, are routinely approved by voters.
The ever-popular tax cap imposed on towns, villages, school districts and other taxing authorities is further proof: if property taxes are so unpopular why does the state of New York need to impose a law intended to discourage grass-roots governments from raising them?
Apparently, taxpayers are willing to pay higher property taxes at least on some things. Public support for the tax cap basically amounts to stop me before I agree to pay more taxes again.
Another reason for the budget gimmicks is a political one: Mangano and Republican legislators have won election and re-election by touting their refusal to raise property taxes.
Some Republican legislators have even maintained this claim when the county did raise taxes.
Legislature Presiding Officer Norman Norma L. Gonsalves — the top official in the Legislature — and Legislator Donald MacKenzie, whose 18th District includes parts of Roslyn were among three Republican legislators who claimed in 2015 a taxpayer-funded mailer that they had not raised property taxes since 2011.
The only problem — outside of using taxpayer money for political purposes — was that county property taxes had gone up in 2015.
Nassau County does face a burden unlike any county in New York State in the form of a county “guaranty,” which makes the county responsible for property tax refunds owed to school districts, villages and other taxing entities. The county has challenged the “guaranty” but state legislators have refused to eliminate it in the face of opposition from school districts and the other taxing entities that would be left bearing some of the cost.
This is combined with an assessment system that is easy to challenge — a practice encouraged by virtually every public official in Nassau County including Mangano at property tax workshops. The assessment system has also spawned a cottage-industry of law firms that specialize in challenging residents’ property taxes.
It is not much of an endorsement of the assessment system when some of Mangano’s biggest campaign contributors are firms that represent residents in challenging their taxes.
The result of these challenges is that Nassau County owed $39.1 million in estimated residential property tax refunds at the end of 2015 that the county has borrowed to repay with interest.
Mangano said in 2013 that a new settlement program had produced “ZERO residential debt liability.”
The only problem, according to Mangano, was that he did not realize Nassau’s residential properties included condominiums located in buildings three stories or less.
The result was another $21 million in tax liability, helping the county reach the $39.1 million mark.
Faced with these problems, it is easy to see why increasing property taxes is unpopular — especially with county officials.
And in truth property taxes are not a particularly fair way to raise money since they don’t take into account a person’s ability to pay, which is subject to change, only the value of their property, which other than challenging the assessment is not.
Sales taxes, which are also used by the county, also tend to place a higher burden on those with less means and discourage economic development in the county. Shortfalls in projected sales tax revenues have also added an additional burden to county revenues.
A fairer way to raise revenue is an income tax, which does take into account a person’s ability to pay and does not fall heaviest against people with the least means.
Perhaps the time has come for the county to consider an income tax to at least partly replace gimmicks, the sales tax and property taxes in financing local government.
Creating a county income tax might not provide a catchy campaign slogan, but it would put county finances on a fairer and more stable footing.
Our Views: A fairer, more stable way to tax
