January 9, 2008
Governor pushes for tax reform, property tax cap
Governor's second State of the State also calls for increased taxpayer investment in schools, infrastructure
Urging New York to pursue its goals aggressively without overlooking the state's fiscal challenges, Governor Eliot Spitzer today outlined an agenda to improve the state's business climate and job growth, schools, universities, health care system, and tax burden.
"We can't abandon our ambition to pursue our goals at full throttle. On the other hand, we must adapt to the fiscal realities that are now upon us," the Governor said in his annual State of the State message. "We must make the hard choices necessary to live within our means – recognizing that every choice must help the people of New York invent a better future.”
The address did not provide details on many of his proposals, leaving that for the Governor's budget message on January 22.
Property-tax cap: The Governor proposed a bipartisan commission that would advance a package of reforms addressing the root of the property tax problems. The commission, which will be led by Nassau County Executive Tom Suozzi, will look at unfunded mandates on both school districts and municipalities. The commission is also charged with proposed ideas on making tax relief system “fairer” to the middle class taxpayer.
"Wherever I go, I hear the same thing: property taxes are too high. We cannot grow if property taxes continue to force young people out of the state and our seniors out of their homes. Together, we have tried to address this crisis," Governor Spitzer said.
"A rebate check may temporarily ease the pain, but it doesn't cure the disease. In the end, it's a losing game for the taxpayer if the state gives you a rebate check on Monday and then on Tuesday your local government taxes it away."
"A tax cap is a blunt instrument, but it forces hard choices and discipline when nothing else works. When combined with real reform of unfunded mandates and a blueprint for providing a high quality education at a more affordable cost, a cap will allow us to invest wisely in our schools while achieving the goal of controlling property taxes."
Key proposals advanced by the Governor include:
Schools and higher education
- Increasing school accountability by creating improvement targets for specific school districts and specific schools. The Governor also promised to intervene in failing schools.
- Creating an endowment program for the state's colleges and universities with an initial investment of $4 billion. The Governor proposed funding the endowment by tapping into the state's lottery system.
- Hiring 2,000 new full-time faculty members for SUNY and CUNY, including "eminent scholars" whose research would attract world-wide attention and funding.
- Creating an “Innovation Fund” for research at New York's public and private universities.
- Increasing investment in the state's community colleges, including moving forward on plans to expand the University at Buffalo, to make the University of Buffalo and SUNY-Stony Brook flagships in the SUNY system, and to make it easier to transfer from the state's two-year schools to four-year institutions.
- Fully funding the expansion of the state's children's health insurance program. The Governor did now say how much this would cost or where the revenues would come from. New York State already collects some $2.5 billion a year in taxes on health insurance, a tax few other states impose at any level.
- Revamping the state's Medicaid reimbursement rates to pay less for routine procedures and more for primary and preventive care.
- Investing in a secure electronic health records system.
- Creating a "Peace Corps" for doctors with a program that would help repay doctors' student loans and provide other incentives for physicians to work in underserved parts of the state.
Paid family leave
- The Governor urged passage of the controversial paid family leave bill. The Business Council has consistently opposed such legislation, arguing that it would add to the state's already heavy burden of employer mandates that inflate job-creation costs.
Other economic proposals
- Creating a $1 billion "Upstate Revitalization Fund" that will invest in business, infrastructure and agribusiness. The Governor said he will discuss the fund, which includes funding for his City-by-city plan, next week at his State of Upstate address in Buffalo.