Horoscopes
Columnists
Like Us On Facebook

A Suggestion to Lower New York Property Taxes

highest-tax-slide_web

 

A Suggestion to Help Lower New York Property Taxes

BY JEFFREY OPPENHEIM, M.D.

There are more than 1,600 local governments in New York, including counties, cities, towns, and villages. In each of these municipalities elected officials are free to set their own salaries as high (or low) as they choose. Unfortunately, there is no standard by which such salaries can be set. As a consequence, New Yorkers are forced to pay inequitably high salaries for many of these elected officials and this is one of the reasons property taxes are so high. It would make common sense for the state to offer guidance to local governments in setting the salaries of these elected officials.

 

Taxes in New York are among the highest in the nation. According to the Tax Foundation, New Yorkers have the highest per-capita income tax cost in the nation. Under the crush of state income taxes, property taxes, estate taxes and sales taxes, it is no wonder that citizens in New York are leaving the state. Since 1960 a net of more than 7.3 million people have left New York – more than any other state. Those people are taking their money with them. The IRS reports that between 2009 and 2014 New York lost more than $22 billion in wealth. Consequently, any proposal that can help reduce the burden of taxes in NY is worth considering.

There is enormous variation in the salaries of elected officials in local government, even among adjacent communities with comparable populations. For example, in Rockland County the Mayor of Spring Valley is paid $115,000 while the Mayor of Nyack earns only $16,200. The Spring Valley executive earns more than the Supervisor of Orangetown, even though the population of Orangetown is 50% greater than that of Spring Valley. The Mayor of West Haverstraw earns 4 times the salary of Sleepy Hollow’s Mayor, even though the villages have identically sized populations.

The pay of Town Supervisors are also widely dissimilar. For example, the Supervisor of Mount Kisco earns $11,000 while the Supervisor of Clarkstown earns more than $170,000. Disparities in the salaries of trustees and council members are also prevalent. The burden of these disparate costs are borne entirely by the taxpayers.

An elected official’s salary should, ideally, reflect the responsibility and time required to perform their work. Unfortunately, there are no standards by which public officials can determine what an appropriate salary might be. All too often salaries appear to rise to the highest level that officials feel that they can get away with. Yet, even when conscientious people overset these rates for themselves, excessively high salaries waste the hard earned income of the taxpayers.

txfinewell

Some elected officials are reluctant to raise salaries at all, lest they appear to be benefiting unduly from their position. This too, is not good for the public. Low salaries can raise the risk of corruption. The parade of recent indictments of elected officials in New York is often blamed on the low pay meted out to some officials. While this is a highly suspect rationalization for illegal behavior, it is not unreasonable to agree that insufficient compensation could serve as a incentive to dishonest public service.

We want the best and the brightest to offer their skills on behalf of the public good. While the most important incentive should be the reward of doing good work, we shouldn’t disincentivize people from public service if they can’t otherwise provide for themselves and their families. Fairness is not necessarily a synonym for stinginess. Some Hudson valley villages (e.g. Grandview, Upper Nyack and Bronxville) pay their Mayors nothing. Yet, such examples are the exception and not the norm.

Elected officials in the State Senate and Assembly have not given themselves a pay increase since 1999. These State legislators earn $79,000 per year. For many officials this is their only source of income and traditionally many lawmakers have supplemented that income with other jobs. Unfortunately, the ability to hold other jobs has led to corruption. For example, low pay was cited as a reason by former Assemblyman William Scarborough when he was sentenced to jail for submitting more than $40,000 in fraudulent travel vouchers. Some have argued that the convictions of former leaders Skelos and Silver might have been prevented if they had been disincentivized or prohibited from seeking other sources of income.

In order to set a fair standard for their pay, state elected officials enacted a law creating an independent body to recommend pay increases. This plan loosely followed a similar law in New York City which empowered an independent Quadrennial Advisory Commission of private citizens to review the salaries of elected officials every four years.  Section 3-601 of the NYC Code requires the commission to consider “the duties and responsibilities of each position; the current salary of the position and the length of time since the last change; any change in the cost of living; comparison of salary levels for other officers and employees of the city; and salaries and salary trends for positions with analogous duties and responsibilities both within government and in the private sector.” The NYC Mayor and Council can approve, reject or amend the recommendations of the commission.

The NY state legislature empowered the New York State Commission on Legislative, Judicial and Executive Compensation to set salaries for state governmental leaders. While the idea of setting an independent commission to fairly set compensation makes sense, the details of this program make it suspect. First, the legislature made the recommendations of the commission automatic unless specifically rejected by legislation. This means that if the panel were to make excessive recommendations the legislature merely needs to ignore action and the reward will be a high pay immune from clear responsibility. Second, the commission is not able to mandate that state officials curtail outside sources of income. This means that even if they were to propose a high increase in wages (some speculate as much as 47%) the corruption might continue. Finally, the Commissions recommendations are conveniently due on November 15, 2016, a few days after the upcoming election. The timing of this report is set by the law and is is obviously not coincidental.

Most people oppose pay increases for elected officials. From the perspective of the average taxpayer, elected officials benefit from the prestige and power of their offices, making high pay an unnecessary indignity to the voter. Perhaps this is why the President of the United States earns $500,000 while the 200 highest paid CEOs in America earn a median pay of $17.6 million. Money is considered a reward for capitalism, not governing.

In 2014, a poll at Quinnipiac University found that 82% of New Yorkers opposed a pay increase for state legislators. The NYS Commission appears to have been set up as a means by which the legislature can increase its pay while denying accountability. The NYC Commission, however, requires that the Mayor and City Council take affirmative action to raise its salaries. From this perspective, a Commission can be helpful if its recommendations are neither automatic nor surreptitious.

If taxpayers want local elected officials to have fair salaries without excess or disparity, then the state can help. An independent commission established by the state (or perhaps by the Attorney General or Comptroller) could examine the data and make non-binding recommendations for salaries. Similar to the work of the New York City commission, this examination should take into account the size and complexity of the local government, the scope of work, the responsibilities of the officials and the comparable salaries of similarly situated governments. Such recommendations would be blind to the parties or politics. Most importantly, the recommendations would be non-binding. Local officials would remain in charge of setting their own salaries (which is consistent with the law), but would have to answer to the public if their wages were widely disparate.

The New York legislature has tried to help control local property taxes by imposing stringent caps. While their efforts seemed sensible, the consequences have yet to be determined. The problem with these tax caps is that they are unfunded mandates which demand outcomes without providing guidance. A better approach would be to offer specific recommendations, and this could begin with recommendations for reasonable and fair salaries for elected officials.

capnypropertytax

An elected official who chooses to raise his/her salary higher than a commission’s recommendation would likely face criticism by political opponents during election season. Conversely, an incumbent who chose a lower salary would likely want to advertise that fact during a re-election campaign. The commission’s recommendations would therefore become a political pressure to control salaries, rather than a mandate to cut public services.

In a democracy, the actions of elected officials are judged by the public at the ballot. But when it comes to setting salaries, the public often does not have a good metric by which to judge these actions. The benefit of an independent state commission on local elected official salaries would be fairness to these officials and lower taxes for the public. A salary benchmark that local officials and the public could turn to for guidance might therefore become a concrete basis for real reform.

NAME

 

LAST BUDGET (MAYOR/SUPERVISOR)

 

CURRENT BUDGET (MAYOR/SUPERVISOR)

 

LAST BUDGET (TRUSTEE/COUNCIL MEMBER)

 

CURRENT BUDGET (TRUSTEE/COUNCIL MEMBER)

 

CITY/TOWN/VILLAGE

 

COUNTY

 

ESTIMATED POPULATION (2014)

 

ESTIMATED # OF HOUSEHOLDS (2014)

 

COST PER CAPITA

 

COST PER HOUSEHOLD

 

Clarkstown $170,309.00 $170,309.00 $43,509.00 $46,116.00 Town Rockland 85,801 29,238 $1.98 $5.82
Ramapo $145,574.00 $145,574.00 $35,832.00 $35,832.00 Town Rockland 130,064 34,365 $1.12 $4.24
Spring Valley $115,000.00 $115,000.00 $25,000.00 Village Rockland 32,007 8,604 $3.59 $13.37
Orangetown $104,503.00 $104,503.00 $23,355.00 $23,355.00 Town Rockland 49,905 17,914 $2.09 $5.83
Stony Point $84,741.96 $86,861.00 $14,227.00 $14,583.00 Town Rockland 15,278 5,035 $5.69 $17.25
New Square $2,400.00 $78,000.00 $250.00 $250.00 Village Rockland 7,328 1,228 $10.64 $63.52
Haverstraw $40,000.00 $61,800.00 $15,448.00 $15,911.00 Village Rockland 12,060 11,842 $5.12 $5.22
West Haverstraw $46,616.00 $47,548.00 $17,376.00 $17,718.00 Village Rockland 10,308 2,963 $4.61 $16.05
New Hempstead $30,000.00 $30,600.00 $5,000.00 $5,100.00 Village Rockland 5,240 1,169 $5.84 $26.18
Suffern $27,000.00 $27,000.00 $9,450.00 $9,450.00 Village Rockland 10,864 4,334 $2.49 $6.23
Chestnut Ridge $25,000.00 $25,000.00 $6,000.00 $6,000.00 Village Rockland 8,035 2,551 $3.11 $9.80
Airmont $25,000.00 $22,500.00 $2,839.00 $3,786.00 Village Rockland 8,770 2,711 $2.57 $8.30
Montebello $21,000.00 $21,000.00 $3,000.00 $4,000.00 Village Rockland 4,588 1,499 $4.58 $14.01
Nyack $16,200.00 $16,200.00 $8,100.00 $8,100.00 Village Rockland 6,857 3,295 $2.36 $4.92
Sloatsburg $12,000.00 $12,000.00 $4,500.00 $4,500.00 Village Rockland 3,086 1,075 $3.89 $11.16

Reference:   http://www.lohud.com/story/news/investigations/2016/08/25/rockland-highest-paid-officials/87969498/

-Jeffrey Oppenheim is a neurosurgeon and the former Mayor of Montebello, NY

Comments