Paterson cracks down on unfunded mandates
ALBANY—State agencies can no longer propose legislation or regulations without first revealing the impact the plans will have on local property taxpayers, Gov. David A. Paterson mandated in an executive order he signed Monday.
While the edict applies only to executive branch agencies he oversees, Paterson threatened lawmakers that the days of passing on the costs of legislation to localities— an age-old process known as unfunded mandates — are over.
“We can’t allow this to go on any further,” Paterson said of the Albany mandates that contribute mightily to local property tax increases that put New York’s levy at 78 percent above the national average.
“And it won’t go on any further today because I’m not going to sign any legislation that I think has an undue impact on counties, local governments or taxpayers,” he said. Paterson, though, left some wiggle room by not specifically defining his definition of “undue impact.”
In a mode of trying to resurrect his standing among voters, which has plummeted in the past several months in various polls, Paterson is circling back to the issue of property taxes—an especially important one upstate and on Long Island.
But the first return by Paterson to the subject since last year is much less ambitious: The executive order does not specially apply to the Legislature, which proposes the vast majority of bills that affect localities.
“Now is the time for Albany to get a wakeup call. Now is the time for Albany to find ways to reduce costs to the counties and local governments all around this state,” he said at an event Monday morning in Schenectady County.
The governor a year ago had sought to place a cap — permitting a 4 percent increase or 120 percent of the inflation rate, whichever is lower — on annual property tax hikes at about the inflation rate, a plan killed by Democrats in the Assembly. Paterson said he still hopes his property tax cap can advance, though he has gotten no indication of such a likelihood from Assembly Speaker Sheldon Silver, D-Manhattan, the cap’s most vocal critic.
Paterson said polling has shown 74 percent of New Yorkers want a cap. He derided a plan Silver and labor unions have advanced that would lower property taxes for many New Yorkers based on their income levels, with the state picking up the difference for local governments. Paterson called that plan unaffordable given the state’s precarious finances, which he said have already raised the prospect of a $2.7 billion deficit in 2010.
“The best way is to cap the property taxes,” Paterson said. He said lawmakers mistakenly believe that since incumbents keep getting elected that residents don’t care about property taxes. “Everybody wants it,” he said of the cap.
The governor’s new executive order requires any legislation or regulation proposed by his administration or state agency to first determine the fiscal impact on local governments. Legislation proposed by the executive branch and legislators are already supposed to contain a “fiscal impact” statement; in reality, sponsors of many bills often make no real effort to determine the true cost of a bill.
The governor’s executive order said proposed bills and regulations must also contain potential cost benefits to localities and determine why the proposal might be a benefit to a local government.
Local government representatives hailed his new executive order.
“This is the first real effort we’ve seen in decades to stop that tax shifting,” said Peter Baynes, executive director of the New York Conference of Mayors.
“This is a powerful policy,” said Stephen Acquario, executive director of the New York State Association of Counties.
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