Teresi Disagrees With Cuomo’s Tax Freeze Proposal

Local officials throughout the state disagree with how the governor wants to lower property taxes.

Jamestown Mayor Sam Teresi attended the recent New York Conference of Mayors winter legislative meeting. The Jamestown mayor said everyone’s goal is to lower taxes, but how to do it is in question.

”The property tax burden in the state is killing business investment and driving residents out of the state,” Teresi said. ”Our taxes are the highest because we spend the most. We need to attack the problem on the expenditure side of the equation.”

Teresi said Gov. Andrew Cuomo’s new property tax freeze proposal is not being met favorably by state mayors. In January, Cuomo announced his new proposal to offer rebate checks to homeowners in municipalities that stay under the 2 percent tax cap and work toward consolidation, sharing services and collaborating with other communities.

Teresi said state mayors, including himself, have concerns with the governor’s proposal. The Jamestown mayor said in the first year of Cuomo’s plan, if a taxing jurisdiction stays under the state’s 2 percent property tax cap, but still has to raise taxes, a rebate check would be sent to the homeowner in the amount of the increase.

In year two of the tax freeze program, the taxing jurisdiction would have to create a plan to share services, consolidate and collaborate with other local entities. Also, the taxing entity would have to lower its tax levy by 1 percent in order for homeowners to receive a rebate check. In year three of the program, the entity would have to lower its tax levy by 2 percent. In the following year, the municipality would have to decrease property taxes by 3 percent.

”This is a very complicated and confusing proposal,” Teresi said. ”Also, the rebate checks would only go to homeowners. The rebate checks would not go to industries, commercial businesses or multi-residential property owners. So it is not a true tax freeze because it doesn’t apply to everybody.”

Teresi said another concern with the program is the lack of recognition for what municipalities have already done to share services, consolidate and collaborate.

”There is no recognition for prior efforts made by local governments that have been in the collaboration and consolidation game for decades,” he said. ”We here in Jamestown have already picked the low-hanging fruit off the tree. There is not much left to do on the consolidation front because we’ve been doing it successfully going back to the 1970s. In essence, they’re making it more difficult or impossible for Jamestown or Chautauqua County to meet the performance thresholds.”

Another concern is the rebate check mechanism. Teresi said there has to be a better way to reward property taxpayers than issuing rebate checks that would cost millions to produce. The Jamestown mayor said the consensus feeling from mayors at the meeting would be to fund rebate money toward municipalities in state aid.

The city’s Aid and Incentives for Municipalities, also known as AIM, has not increased since 2009. In fact, the aid went from $5,029,795 in 2009 to $4,665,592 in 2010. In 2011, AIM was lowered again to $4,572,280, and has remained flat since.

”It has been proven when state increases AIM, local governments put it to good use. There is a history of property tax relief every time AIM is increased,” he said. ”We’re not opposed to sharing services, consolidating and collaboration, we just think there is a better way than issuing rebate checks.”

Teresi added that he believes Cuomo has done quality work since becoming governor in reducing mandates for local municipalities. He said the new Tier 6 for the state retirement’s system and the Medicaid cap has worked in lowering the financial burden for local municipalities.

”There have been some good changes, but there is still much to be done,” Teresi said.