New York State is on the verge of making the 2 percent property tax cap on school districts and municipalities permanent.
The new state Senate recently approved legislation to make the tax cap permanent and last week Gov. Andrew Cuomo joined a long list of business and government groups giving his support. All that is needed now is state Assembly approval.
Cuomo said the tax cap has fulfilled its goal when first passed in 2011 – “to rein in out-of-control local taxes” – and has saved New Yorkers $25 billion since then.
The governor added that the need to control taxes was even more important this year following a tax cut plan backed by a Republican Congress and President Donald Trump that capped the deductibility of state and local taxes.
This, Cuomo correctly pointed out, effectively raises taxes on many New Yorkers.
Cuomo is also correct in saying that taxes in New York are high compared with most other states – with Long Island among the highest taxed places in New York.
But before rushing to embrace a permanent tax cap you might want to consider a few points.
Yes, New Yorkers do pay high taxes. But in return, they receive lots of services from towns, villages and schools.
That, in part, was the point of the $10,000 limit on deductions placed on state and local taxes by Republicans in Congress and Trump. To reduce the size of government in mainly blue states that had higher tax rates – and higher levels of public service.
To which a permanent 2 percent tax cap means mission accomplished.
Hempstead Town Supervisor Laura Gillen announced last week that she had directed all 28 town departments to begin identifying areas of discretionary spending that can be cut to offset $3.8 million worth of local municipal aid that may be removed from the state budget Cuomo has proposed.
Gillen said she would need to see cuts totaling 5 percent to offset the loss.
In North Hempstead, all but two of the town’s 29 villages would see decreases in the state’s Aid to Municipalities. The exceptions are Williston Park and Manorhaven.
The proposed cuts do not appear to be a direct result of the cap. Cuomo’s proposed budget also includes a $10.39 million increase in state aid to local school districts.
So the proposed budget may just be the governor’s expression of his preferences for where state money goes. Or his understanding of the tax cap, which requires school districts to get 60 percent of the vote to exceed the tax cap but only a three-fifths vote of trustees or council members for towns and villages to exceed the tax cap.
But the proposed spending cuts may also be a glimpse of the future.
Another issue is the matter of say that towns, villages and school districts have over how much they spend.
The tax cap takes at least part of the decision of how much local governments and school districts spend and gives it to the state Legislature and the governor.
This is fine if you believe state legislators do a better in making spending decisions for people on Long Island. But not so fine if you are a believer in more local control of spending decisions.
This is more like giving local government a learners permit rather than a license with the instruction to make sure you bring the car home by 10 p.m.
Some in local government seem OK with this. They seem to be saying, Stop me before I spend again.
Which, given our experience with Nassau County in the past, might not be a bad idea.
But consider that you are granting this control to the state government.
The state Legislature and the governor have in recent weeks made some significant progress in terms of election laws, reproductive rights and the treatment of sexually abused children.
But this is still the New York State Legislature we’re talking about, which has not been in any stretch of the imagination a model of good governance.
Another concern is the impact on spending per student where some school districts – hello North Hempstead – spend thousands and thousands more per pupil than other school districts.
This is known as destiny by ZIP code where the playing field is tilted to children of more affluent parents.
You would think that we could at least design a system in which children with less affluent parents would not be disadvantaged until they have at least graduated from kindergarten.
The tax cap imposed in 2012 essentially froze the disparity in per-pupil spending between school districts by requiring those school districts seeking to narrow that disparity to get a supermajority of the vote.
It is true that school districts with lower spending per pupil do generally receive more state aid money. But not nearly enough to eliminate the gap or come anywhere close.
And making the tax cap permanent in all likelihood will make the disparity permanent. Unless the state Legislature grants an exemption to the tax cap to districts with spending per pupil below a certain threshold.
Or unless the state makes significant changes to the school funding formula to favor districts with lower spending per pupil more.
In that case, parents in districts with higher spending per pupil might not be quite as supportive of a 2 percent tax cap. But by then it will be too late
