Delivering on a Pledge to Cut Taxes Pataki proposes change, but it’s not good for LI

February 6, 1995

By Mark J. Grossman

So, Long Island, the change we wanted is here. State spending will be cut. State income taxes will be cut. Is this the answer to our problems?

Not really.

That’s because New York’s tax problem isn’t income tax — New York State government ranks 22nd in the nation in terms of tax burden to its residents. In terms of total tax burden, New York does rank No. 2 after Alaska, but the reason isn’t income tax. It’s property tax.

And for Long Islanders — who pay among the highest property tax rates in the nation — Gov. George Pataki’s budget is not good news.

After a decade of protesting that it doesn’t get its “fair share” from Albany, Long Island will now pay more and get less from state government.

Gone are the soccer stadium and possibly the swimming complex needed to retain the Goodwill Games on Long Island. Nassau now risks losing millions in tax revenue and tourism dollars.

Gone is the state’s $1.7-million internationally recognized defense diversification program, which gives half its funding to Long Island firms. How will companies such as Hazeltine, Dayton T. Brown and the Servo Corp. be able to continue to grow by re-tooling for civilian technologies and re-employing defense workers? It won’t be easy. A still-weakened Long Island economy will lose a very important helping hand. And it may push the region’s unemployment rolls up.

Gone are dozens of capital road projects Long Island needs. Among those endangered are the final leg of the Sunrise Highway extension to Oakdale and the fourth lane on the Long Island Expressway in Nassau. These improvements are vital to Long Island’s economic vitality and growth.

Gone will be thousands of jobs, eliminated by reduced public projects, government downsizing and decreased economic development aid.

Gone are millions to improve the Long Island Rail Road. Certainly the tens of millions of dollars to be cut from the Metropolitan Transportation Authority will be devastating to the LIRR.

But what definitely won’t be gone are the poor. While there may be $400-a-month rental apartments in upstate Canajoharie, none exists on Long Island for families on welfare. So a reduction in Aid to Families With Dependent Children will mean an increase in homelessness.

And Medicaid reductions for elderly home care will mean more older people in nursing homes, if you can find a bed on Long Island.

And human-service, not-for-profit organizations — which often serve as the safety net below the safety net — will also have their budgets ravaged by Albany and Washington’s cost-cutting frenzy, severely reducing their ability to serve a growing clientele of needy.

The result: increased costs to local governments, especially counties. Which means increased taxes of the regressive kind: property and sales. It’s happening in New Jersey and it will happen here.

And what of our school taxes? When the governor’s so-called “no-cut” school aid proposal is applied, it will surprise many. Take, for example, the plight of high-tax, low-wealth school districts such as William Floyd, Sachem, South Country and Wyandanch.

Since the large part of their budgets are state aid, a very modest 3-percent budget increase would require a local property-tax rate hike three times that. For these districts, which can least afford tax hikes or cuts, Pataki’s budget will mean both.

The governor’s school-aid plan does nothing to reform the funding process that clearly penalizes Long Island’s middle class and working class.

Ironically, this could have been a banner year for Long Island school districts. The State Education Department’s equalization-rate data were finally brought current to reflect Long Island’s depreciated home values. If those data were applied, Long Island’s property wealth would better reflect the true value of our homes, not inflated prices that we could have gotten in the ’80s. Unfortunately, the governor’s proposed budget simply carries over last year’s figures and thus pre-empts any adjustment that would benefit Long Island taxpayers.

And that’s too bad, because Long Islanders have been desperately asking for more attention from the state — more recognition about the Island’s high cost of living and more of its “fair share” from Albany.

It was a refrain I heard many times as Gov. Mario Cuomo’s Long Island regional director. And while it was a perception that was largely untrue, it was a perception that led to the Pataki landslide in Nassau and Suffolk Counties.

So, Long Island, enjoy your $100 or so income tax savings while you can. But, before you spend the money too quickly, remember the LIRR fare hike, your SUNY tuition increase, your property-tax increase and the extra gas you’ll spend idling on our ill-equipped roads. Then figure out which side of the equation you’re on.

The changes Long Islanders wanted are here. But, in the future, Islanders might be more careful what they wish for. Sometimes wishes come true.

Mark J. Grossman was former Gov. Mario Cuomo’ s Long Island regional director. He now heads Grossman Strategies, a consulting firm.

Mark J. Grossman, Delivering on a Pledge to Cut Taxes Pataki proposes change, but it’s not good for LI.
Newsday, 02-06-1995, pp A23.