January 17, 2007
Thiele Moves To Cap Property Taxes
If Assemblyman Fred Thiele has his way, beleaguered New York State property owners may get some relief from ever increasing taxes.
Thiele's proposal, should it become law, would limit the amount a property owner pays in gross taxes — including school and municipal — to five percent of total household income. Thus, a family with an income of $100,000 would not pay more than $5000 in taxes regardless of how high their tax bills are.
Thiele estimated the state would have to make up about a $5 billion annual short fall.
"It could be made up by the state transferring the balance to income or corporate tax," he said. "There is a mechanism already in place. All households with an annual income of $150,000 or less would be affected." On the upper end of the pay scale, the cap would be $7500. Families that have a gross income of $20,000 would only be required to pay $1000 in property taxes.
Thiele said he realizes the cap might provide school districts an impetus to increase spending.
"In the last 10 years school spending has exceeded the rate of inflation fourfold. Clearly, you have to attack the problem from both sides," he said. "School districts will find a way to spend more money." The State Senate has a proposal to limit school spending in the works, the assemblyman added.
In response to the uproar following the recent property tax reassessment in Southampton Town, Thiele is also proposing to cap tax increases due to reassessments. Under his proposal the tax increase would be limited to five percent, the rate of inflation, or the actual fair market value, whichever is less.
"Reassessment programs can have a devastating effect on long time residents, especially senior citizens," he pointed out. The assessed value of a home would be readjusted when the affected property is sold.
Thiele will also suggest allowing senior citizens to defer up to $2500 a year. The deferred taxes would become a lien on the property and be collected upon sale or transfer to another family member.
Thiele's tax reforms only apply to primary residences; second homeowners would see no reductions.
State Income Tax filings would be used to gauge income levels, and those who qualify would receive rebate checks directly from the state treasury.
"It is clear the crushing burden of property taxes is one of the most important issues New York is facing," Thiele said. He believes his proposal "far more accurately reflects the public's ability to pay than the current system."