Gov. David A. Paterson's plan to pull back the STAR property tax exemption for owners of homes worth $1.5 million or more would bite deeper on Long Island, where home prices are among the nation's highest.
In Nassau County, there are 14,601 homes worth $1.5 million or more, according to the county assessor, Thaddeus Jankowski. A count of Suffolk properties, which are assessed by the county's 10 towns, was not available Tuesday, but Pearl Kamer, chief economist for the Long Island Association, noted of both counties, "We have a lot of homes in that price range."
The cost of losing a basic STAR exemption depends on the school district where the homeowner pays taxes: In Great Neck, where there are 2,585 homes valued at more than $1.5 million each, the STAR exemption is worth $553, while in Levittown, the basic STAR is worth $1,295 - though Levittown has no homes pricey enough to lose the exemption if Paterson's proposal were adopted, Jankowski said.
Neither Nassau Executive Edward Mangano nor Suffolk Executive Steve Levy responded to a request for comment Tuesday on the governor's proposed STAR trims.
But Kamer suggested the cuts could be a "problem" for some homeowners.
"You can be real-estate rich and yet income poor," Kamer said. Without enough current income, "it could put the homeowner in financial stress."
Loss of that exemption could also make it more difficult to sell homes in that price range, she said, noting pricier homes are already harder to sell because of the difficulty obtaining mortgages.
To be sure, Paterson's budget proposal also includes a "circuit-breaker" income-tax credit feature that would divide any budget surplus among those who pay the highest share of their income in property taxes.
That proposal drew a scoff from E.J. McMahon, director of the Empire Center for New York State Policy, a conservative think tank, who suggested it "came from the Pandora moonbase" because he believes it has as little chance of passing as the property tax cap the governor proposed a year ago.
"What circuit breaker? That's fantasy. . . . There's going to be some people on Long Island who pay more in property taxes," McMahon said.