Cuomo: Renter tax credit balances property tax break
ALBANY—Governor Andrew Cuomo said he would add a rebate targeted at urban renters as a “balancing point” to the package of property tax cuts that a gubernatorial commission recommended last week to make it more politically palatable.
During a Monday morning cabinet meeting where administration aides briefed the governor on their accomplishments, state budget director Bob Megna re-presented the commission's findings for the Capitol press corps. This is the second day of coordinated pushback against indifferent press reaction to the commission, which was co-chaired by George Pataki and Carl McCall, two former Cuomo rivals.
The commission recommended spending $1 billion over three years on a property tax “circuit breaker”—where citizens get a rebate when property taxes hit a certain portion of their income—as well as an effective freeze for ratepayers who live in municipalities that abide by a Cuomo-passed two-percent cap on growth. Critics on the right, including the Wall Street Journal, said the property tax relief would come on the backs of New York City residents, who provide a disproportionate amount of state funding through higher income tax rates which Cuomo mostly renewed.
“Renters often pay a proportion of their rent to property tax, so while the commission didn't recommend it, some members of the commission actually petitioned the governor to think about a renters credit. The governor has been clear that he is in support of the renters' credit to achieve proportionality in the commission's proposal,” said Bob Megna, the governor's budget director.
The program would direct at least $292 million to New York City households over three years, Megna said, but it would be “premature” to discuss its exact parameters.
Cuomo, a Democrat who is seeking re-election next year, said the renters credit is being considered for political reasons.
“To pass an economic package you need balance,” he said. “You have a Senate, you have an Assembly. They have different philosophies when it comes to this issue, so you're going to need balance between a tax increase, tax decrease—you need balance between urban and Upstate and suburban—if you expect to actually pass it. So unless you're doing it as an academic exercise, then you know the predictable political interests and shape a package that can pass, and is fair and equitable.”
The Pataki-McCall report does in fact offer something for each of the various parties to get behind. Downstate businesses like its proposal to eliminate a separate bank tax and lower the corporate franchise tax. Upstate manufacturers have long pushed to get rid of a surcharge on electricity, known as 18-a, and labor-backed progressive groups have long pushed for the circuit breaker.
Legislatively, Senate Republicans were the most receptive to the initial set of recommendations; New York City Democrats who dominate the Assembly may warm up to it with the new renter's credit attached. Senate Independent Democratic Conference leader Jeff Klein has supported a circuit breaker in the past, but announced his own proposals for helping middle-class New Yorkers.
Cuomo and his aides continued to be unspecific about how the tax cuts will be paid for, repeating that there should be enough money if they can hold state spending to less than two percent growth. Even so, Cuomo promised, “there will be no cuts.”
The governor will release details of his budget in mid-January.