Quote:
Senate plan could eliminate property taxes
by MARY LOU RATH
New York State Senator The State Senate passed a plan last week designed to give local taxpayers the ability to phase out property taxes and put the money directly back in their pockets. It represents a major overhaul of a system that currently is burdensome and difficult to rein in.
The plan allows us to truly partner with the residents of New York State to eliminate the tax that hits our wallets the hardest.
The New York "Stop Taxing Our Property" Reform Plan would give school districts the authority to eliminate residential property taxes during a five-year period, with revenue replaced by additional state funding.
Under the provisions of the bill, every school district would be authorized to take a public vote to determine if real property taxes on primary residences (STAR-eligible properties only) would be phased out over five years and be replaced with additional state funding. This vote would be held on the third Tuesday in May (school district budget vote day).
The proposition would be placed on the ballot only after the submission of a petition which contained at least 25 percent of the persons who voted in the previous school budget vote (or in the previous general election in the Big Five cities).
Districts which enter into this system would be required to reduce residential real property taxes on primary homes by 20 percent annually until such tax was eliminated after five years.
A new state aid formula would be created to fully reimburse districts for this reduction in local tax collections. After five years, the formula would provide districts with an annual school aid
cost-of-living increase.
In 2006, primary residential homeowners paid approximately $9.5 billion in school property taxes. If every school district entered the optional system, the 20 percent reduction in residential tax levies would reduce school property taxes by $1.9 billion annually.
Eventually, if every school district were under this new system, state funding would fully replace the $9.5 billion paid by homeowners in school taxes. Under the new system, property taxes on other properties (for example, second homes, apartments and businesses) would continue under the current taxing system.
Districts which do not enter into this financing system would continue under the existing property tax structure.
Other components of the NY-STOP plan include: imposing an immediate freeze on property tax assessments for seniors, creating a Blue Ribbon Commission on Property Tax Reform and enacting comprehensive mandate relief measures to help lower costs for school districts and municipalities.
It is essential that the Assembly and the Governor act on these measures immediately so taxpayers can benefit as soon as possible.
...and then the money comes from where?