Wall Street Journal: Proposal to Loosen Tax Cap Advances
May 24, 2011
The following article was published in the Wall Street Journal on May 24, 2011:
Proposal to Loosen Tax Cap Advances
By Jacob Gershman
Assembly Democrats are advancing a measure the would limit growth in property taxes, but would allow local governments to raise levies at a faster clip than the tax cap envisioned by the Cuomo administration.
Assembly Speaker Sheldon Silver, a Democrat, sketched out details of the legislation at a private meeting with members of his conference on Monday. A spokesman for Mr. Silver said the Assembly would introduce a tax-cap bill on Tuesday but declined to share details.
A Democratic assemblyman said the plan would restrict increases in local property tax levies outside New York City to no more than 2% a year—the same limit proposed by Gov. Andrew Cuomo. But the Assembly plan loosens the cap, carving out an exception for a portion of future growth in public-employee pension costs, according to the lawmaker.
The original plan for a cap put forward by Mr. Cuomo didn’t exempt pension expenses, which are expected to skyrocket over the next several years.
While Mr. Cuomo has sought a permanent cap, Democrats want to include a sunset provision that would allow the cap to expire unless Albany renews the law, according to the lawmaker. Mr. Silver indicated that the time-frame for the sunset would match whatever expiration date is attached to another legislative proposal for renewing the state’s rent-regulation laws, the individual said.
Mr. Cuomo has said he’s willing to negotiate changes to his original proposal, a signature issue for his campaign for governor last year. He’s been vague on what changes to his plan his administration would accept or rule out. Spokesmen for the governor’s office and for Senate Republicans, which passed Mr. Cuomo’s tax cap bill earlier in the year, declined to comment