Republican Plan To Give More Tax Relief Was Defeated

Hugh T. Farley

March 18, 2010

State Senator Hugh T. Farley (R, C, I - Schenectady) reported the comprehensive property tax relief plan proposed by Senate Republicans that would restore STAR property tax rebate checks for every middle-class taxpayer, put a property tax cap in place to control local spending and calls for extensive mandate relief measures to reduce local school district costs, was defeated in the Senate today.

Senate Republicans proposed an amendment to enact the "Protection and Property Tax Rebate Act," a major new tax cut initiative announced by Republicans last week. Every Republican Senator voted in favor of the plan, while every Senate Democrat voted against it.

The Senate Republicans’ "Protection and Property Tax Rebate Act" would have provided a property tax rebate for every middle-class taxpayer. The rebate would reimburse homeowners based on much they pay in property taxes and how much they can afford. The plan also included a cap on property taxes, along with significant mandate relief to further reduce costs.

The Senate Republicans’ plan would have provided more tax relief to more homeowners:

* The Republican plan would restore STAR property tax rebate checks to every homeowner eligible for the basic and enhanced STAR program.

* The plan would enable senior citizens over 70 years of age to have their school district tax rates frozen at current levels.

* Under the Republican plan, homeowners could receive either a STAR rebate check or a new residential property tax circuit breaker credit, whichever provides more tax relief.

Under the Senate Republican proposal, homeowners would receive a property tax relief check equal to their 2008 STAR property tax rebate or an amount based on their income through a new property tax relief credit, whichever is greater.

The STAR rebate would be approximately thirty percent of a homeowner’s current STAR exemption, providing hundreds of dollars or more each year in property tax relief. A new "breaker" tax credit would give back 70 percent of all property taxes paid in excess of 6 percent of household income.

More than 160,000 New Yorkers signed on to a Republican-led petition drive launched last year to restore the STAR school property tax relief check.

Senate Republicans initiated the STAR rebate check program in 2006 and have been at the forefront of efforts to provide tax relief for struggling New Yorkers.

The "Protection and Property Tax Rebate Act," also calls for a permanent ban on all unfunded mandates, along with implementation of new reforms at the State Education Department to keep costs down.

In addition, the plan would reduce paperwork for schools, authorize regional transportation and provide school districts with greater flexibility to purchase from existing contracts held by other government entities.

The plan also included a proposal to freeze property taxes for seniors age 70 or older to help address the problem of seniors living on fixed incomes who are being taxed out of their homes.

The Republican plan also included a property tax cap to ensure that school districts do their part to hold the line on spending.

Senate Republicans said they will include the proposal in negotiations over the Governor’s $135 billion budget. Once public conference committees are established, they will outline other savings in the budget that could be utilized to include the rebate in any adopted budget.

Thus far, Democrats have not held any public negotiating sessions on the budget despite Senate Republicans’ insistence that a schedule for an open, public budget process be established -- as required by law -- that leads to adoption of an on-time state budget.