by Sen. James L. Seward
New York State government is working again. The proof is abundant. Over the past two years we have eliminated $13 billion in budget gaps without raising taxes or fees, passed two consecutive on-time budgets that reduce spending, consolidated government agencies and enacted a historic property tax cap. Significant steps have been taken to bring New York’s fiscal house in order, but more needs to be done to help homeowners as they work to make ends meet. The state senate recently passed legislation that would restore the STAR property tax rebate program. An initiative that would deliver $202 million in property tax relief to senior citizens in the 2012-13 school year and $1.2 billion in property tax relief to middle class families starting in 2013-14. Back in 2006 when I helped start the STAR rebate check program, the idea was to return homeowners some of their hard earned money each fall to help meet their needs. Moms and Dads often spent it on back to school clothes for their kids. Many used it to help cover their school tax bills which also arrive in the fall. Some put it toward the cost of filling their fuel oil tank to prepare for the winter heating season. The program was successful in reducing the bite of that fall school tax bill. Unfortunately, in 2009 the program was dropped. A petition drive I launched to revive the program received an overwhelming response. But despite the grassroots support the STAR rebate checks did not go out that fall or any year since. Dropping the program served as a de facto tax increase on middle class families and senior citizens already struggling to make ends meet and stay in their homes. Now, at a time when we’ve already seen significant property tax relief thanks to the tax cap enacted last year, we need to continue the forward momentum and reinstate the STAR rebate check program.
Under the provisions of the bill passed by the senate, beginning in the 2012-13 school year, senior citizens would receive a rebate check in an amount that equals 25 percent of the current STAR exemption benefit. The benefit would increase to 35 percent of the STAR exemption starting in the 2013-14 school year. Total property tax relief for seniors next school year would be $202 million. Basic STAR rebate checks for middle class families would be restored beginning in the 2013-14 school year. The amount of the rebate checks would be determined by income and the local school district tax rate. Total property tax relief would be $1.2 billion. The income brackets for upstate counties would be as follows: • $0 to $90,000 – 60 percent of the STAR exemption • $90,001 to $150,000 – 45 percent • $150,001 to $250,000 – 30 percent The basic STAR rebate check percentages would remain the same in the 2014-15 school year, but would increase in each of the next two years to 70 percent, 52.5 percent and 35 percent in 2015-16 and to 80 percent, 60 percent and 40 percent in 2016-17. The senate bill also includes a safety net, in case the STAR rebate checks are ever targeted for extinction again. In any year when there is no state budget appropriation for the rebate checks, senior citizens and middle class taxpayers would be able to claim a property tax credit, equivalent to their rebate check, against their personal income taxes. The median property tax paid nationally is $1,917, while New Yorkers pay $3,755—a whopping 96 percent more than the national median in property taxes. New Yorkers pay the highest local taxes in the country as a percentage of personal income, almost 80 percent above the national average. Those numbers make the case that substantial property tax relief is needed. The STAR rebate checks alone are not the answer, but they are an important part of the solution. I am hopeful the state assembly will join the senate and approve this vital measure.
