A proposed limit on property tax increases will last for five years, according to a basic agreement between Gov. Andrew Cuomo and top legislators.
At that time, legislators would have to vote to keep the tax cap alive—or opt to let it expire, according to aides for Assembly Majority Leader Ron Canestrari (D-Cohoes).
The deal was announced earlier on Tuesday by legislative leaders, who spent most of the afternoon in closed-door talks with their members explaining all the aspects of the legislation. It is unclear when a vote could occur.
Under the deal, property taxes would be limited to 2 percent growth per year, or inflation, whichever is lower. The cap could be discarded in any given year if 60 percent of voters agree to do so.
Legislators briefed on the deal said potential exemptions to the cap include transportation costs, such as bus purchases, as well as capital expenditures and long-term lease payments.
Business groups have pushed for limited, narrow exemptions. They contend the cap will be watered down if some of the fastest-rising costs, such as health care and pension payments, are made immune from the cap.
Powerful education unions and local government officials are among those warning of layoffs and cuts in services if a tax cap is approved. Cuomo, among others, campaigned on the issue.
The legislative session was scheduled to end Monday, but legislators have stayed in town, facing a range of unresolved issues. It is unclear when they will adjourn.
It’s been less than one week since Congressman Tom Reed was named to the Ways and Means Committee, but he’s already set his sights on several targets for the committee.
In a Monday morning conference call, Reed outlined multiple goals aimed at helping America’s businesses return from the doldrums.
The goals will also help lower the national unemployment rate, still hovering at a too-high 9.1 percent, according to the U.S. Bureau of Labor.
“Our top priority is to create the economic opportunity for job growth. That has been our overall theme,” said Reed.
The Ways and Means Committee has jurisdiction over the tax code, a document whose 70,000-plus pages help certain business reap benefits while others pay a heavier burden, said the congressman.
Reed is hoping to eliminate some of the loopholes and exemptions, and create a better balance of tax bills across businesses.
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The New York State Senate has opened the door for regional high schools.
The Senate unanimously passed a bill on Monday that would allow two or more school districts within the same BOCES district to send their students to a joint high school, according to the Dunkirk-Fredonia Observer.
The bill now goes to the Assembly.
Chautauqua Lake, Brocton, Westfield and Ripley have held preliminary discussions about forming a regional high school in southern Chautauqua County.
There is an easy way to shore up state pension systems, or so many leaders elected last year believed: States should move to offering 401(k)-style retirement plans. Eight new governors and numerous new legislators said they would support shifting state employees to these plans, following a move the private sector made long ago. Kansas, Kentucky, Nevada and Oklahoma appeared especially ready to make the change.
But 401(k) fever seems to be over, at least for now. No state this year replaced its traditional fixed-benefit pension with a new plan in which employees set aside a portion of their pay and assume the risk in making investment decisions. Only one state, Indiana, implemented such a plan for new employees, but made it optional.
Enthusiasm for the switch waned after consultants and legislative researchers told state officials that it would cost money before it saves money. That was a difficult sell at a time when many states faced their fourth consecutive year of big budget deficits.
The problem is that changing from a so-called “defined benefit” plan to a “defined contribution” plan comes with huge transactional costs. When the old plan is closed, the employees and retirees who remain in the plan still receive their pension checks even as the number of employees contributing to the plan drops — new hires contribute to the new plan. The state has to make up the difference. In Kentucky’s case, the increased cost would be $8 billion over 15 years. The Nevada price tag: $1.2 billion over the next two years.
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Assemblyman Phil Palmesano (R, Corning), Assemblyman Jim Giglio (R, Allegany County) and other state lawmakers and officials are trying to get a law passed that would help assist in getting mandate relief.
Palmesano says mandate relief should go along with tax caps. “It is imperative as we wind down this session, as we talk about a property tax cap in the same breath that we talk about unfunded mandate relief for our local governments and school districts,” Palmesano said at a press conference at the state capital today. “It’s these cost drivers, these beureaucratic rules and regulations that are placed on these counties and school districts, that are driving up the costs of local budgets, and hence, driving up the property taxes,” Palmesano explained.
Assemblyman Joe Giglio maintains the state needs to get away from this process of unfunded mandates. “Counties and local governments and school districts need relief. If we gave them relief we wouldn’t need to do anything else,” said Giglio. “We have to get away from the state mandating everything they do.
Palmesano and Giglio want the following:
A moratorium on unfunded state mandates
A cap on state spending
Public pension reform
And cutting the expenses of construction projects
The legislation is called the Taxpayer Protection and Mandate Relief Act.