NY should try on a snug tax cap
Gov. Andrew Cuomo with legislative leaders, Assembly Speaker Sheldon Silver (D-Manhattan) and Senate Majority Leader Dean Skelos (R-Rockville Centre). Credit: Albany Times Union
Talk of a property tax cap in this state is practically old hat.
David A. Paterson favored a cap when he was governor, and Gov. Andrew M. Cuomo last year made it a centerpiece of his campaign. The Republican-controlled State Senate adopted cap legislation in 2008. Yet somehow no cap became law, and taxes just kept soaring.
Now, suddenly, caps are back in fashion. Cuomo is embarking on a statewide tour to drum up support for the idea, and Assembly Speaker Sheldon Silver (D-Manhattan) is drafting his own cap proposal, which is a big deal because previously he's been cold to the idea.
It looks, in other words, like this time a legal limit on property tax hikes might actually happen. That's great news; after years of runaway increases driven by soaring school costs, it was clear that nothing else was going to work, and so this page has advocated just such a plan.
But there's a difference between donning a snugly fitting, reasonably well-ventilated cap and simply putting a colander on your head. It's crucial that Albany gets this -- and adopts a cap that really works.
No feasible tax cap can be absolute; even our ideal chapeau would limit increases to something like 2 percent annually while allowing bigger increases if 60 percent of voters approve. But our fear is that Silver's plan will be so loose as to be meaningless. Municipalities and school districts are beset by fast-rising costs for retirement and health benefits, and so often oppose caps or want exemptions in these areas. Yet that's the point of a cap: by making it impossible to pass these costs along to voters, politicians would have to stop agreeing to them in the first place.
Silver isn't the only potential problem on this issue. Senate Republicans are caught between anti-cap teachers (whose wage gains might be limited) and local officials (whose lives are made easier by elastic budgets), on one hand, and tea party activists, on the other, who'll demand scalps if lawmakers come home without the right headgear.
It's time for all parties to make a deal. Cuomo's stance is clear; now Silver and Senate Majority Leader Dean Skelos (R-Rockville Centre) have to come together. Silver has said a cap should be combined with an extension of rent control for downstate counties (including 12,000 units in Nassau County). Like rent control itself, that's a bad idea. But rent regulations are sacred in the five boroughs, and an extension seems unstoppable. A meaningful property tax cap -- even one allowing wiggle room on pensions -- would be a reasonable quid pro quo.
Absent altogether from the political haberdashery is another kind of cap: one limiting increases in state spending. We've advocated this as well, arguing that one cap without the other might simply promote excessive spending and taxing to another level of government. But capping state spending growth requires a constitutional amendment, which is unlikely. A plain old law, along with a very public pledge to uphold it, might work well enough, but that's not on the table either.
That's no reason to let a property tax cap go by the boards. Cuomo and the legislature actually cut spending this year, so why not another miracle? We're not asking for a halo. Just a nice snug cap.
