ALBANY — A new measure being proposed Friday in Albany will provide some much needed relief for city property owners and renters.
State Sen. Andrew Gounardes (D-Bay Ridge) is pitching a “circuit breaker” bill to provide property tax relief to low- and middle-income homeowners and renters in the five boroughs after a similar measure expired at the start of the year.
The legislation would provide a tax refund for New Yorkers whose property tax bill, or Real Property Tax equivalent for renters, is over a certain percentage of household income.
“A circuit breaker is designed to prevent damage from an electrical system becoming overloaded. Right now, New Yorkers are overloaded and need relief," Gounardes said. “My hope is that this will actually bring some real property tax relief for people who, especially in the outer boroughs, live in homes whose values have been steadily rising, but their incomes have not matched the same pace.”
Gounardes says the measure is necessary because lower-income residents pay a larger percentage of their income in property taxes than higher-income New Yorkers based on the simple fact that taxes are based on the value of a home, not income.
The bill builds upon the expired “circuit breaker” by both lowering affordability thresholds and boosting benefit percentages for all incomes below $150,000, while incomes between $150,000 and less than $200,000 receive the same level of benefit that they had previously.
If a homeowner making under $100,000 a year pays more than 2% of their income in property tax they would receive 15% of what they paid back. The return drops to 10% and 5% for those making more.
Consistent with the preexisting NYC tax credit, incomes above $200,000 are not eligible for the circuit breaker.
Fiscal watchdogs such as the Citizens Budget Commission have championed “circuit breakers” among other property tax reforms.
Gounardes has also proposed another piece of legislation that would target wealthy homeowners who enjoy a cap on their home’s value when it comes to property taxes. The bill would eliminate a cap currently placed on the assessed value for homes worth $3 million or more when household income is over $250,000.
“In a fair system, the very wealthiest New Yorkers wouldn’t get a special loophole, while senior citizens and working people struggle to get by. Park Slope shouldn’t pay less than Bay Ridge,” Gounardes said.
Assemblyman Michael Cusick (D-Staten Island), who is sponsoring the"circuit breaker" bill in his chamber, said it makes sense to extend and expand the tax rebate to provide some relief to as many New Yorkers as possible.
“This legislation will help everyday folks across the city, including my constituents in Staten Island, who are struggling to afford the basics under some of the highest property taxes in the nation," he said. "I believe this is a strong first step toward a more equitable property tax system in the city.”