Local elected officials and school administrators gave Gov. Andrew Cuomo’s ninth State of the State address mixed reviews last week as they weighed in on his proposed 2019-20 budget.
“I thought he did a good job,” said State Sen. John Brooks, a Seaford Democrat. “He identified some concerns and went some ways toward addressing them.” Meanwhile, State Assemblyman Dave McDon-ough, a Republican from Merrick, questioned how the governor would fund his ambitious $175 billion State Executive Budget Proposal.
Framing his address as a “justice agenda,” Cuomo said, “We face real challenges in the state of New York. We have a federal government that is assaulting our values, our liberties, our rights and our economy — literally, our economy.”
Federal changes to the tax code threaten the state’s economic viability, he said, adding that he would push for the Legislature to make permanent the 2 percent cap on local property tax growth, which he said has saved the average homeowner $3,200.
“At least if we can say the 2 percent is going to be adhered to,” Cuomo said, “I think it will help give people confidence in the system . . . It’s making a difference in people’s lives.”
Brooks said he remained concerned about the $10,000 cap on federal deductions from state and local taxes, because more than half of Nassau homeowners could see their federal income taxes increase under the new rules. Brooks characterized the cap as “somewhat vindictive,” since it hit so-called blue states with high real estate values, like New York and California, especially hard. And Cuomo has been one of President Trump’s most persistent and vocal critics.
“What the federal government did with SALT was, it penalized New York more than it did any other state,” he said. “New York State is the number one donor state in the United States of America. We send more money to Washington than we get back, and we send more money that we don’t get back than any other state in the nation.”
Cuomo included legislation in his proposed budget that would strengthen and smooth the rough edges of the ongoing property reassessment in Nassau County (see box).
Despite the governor’s bid to make the property tax cap permanent, Brooks said he would like to see more school tax relief for Long Islanders. Last year he proposed a “50-50” cap on property taxes going to school funding, which he expects to reintroduce this session. Under that plan, districts would receive no more than 50 percent of their income from property taxes, with the remainder coming from the state’s general fund.
Brooks said that districts with small commercial property tax bases, such as Seaford and Wantagh, rely on property taxes for as much as 70 percent of their revenue. And those districts can see revenues plunge when home values plummet, as they did during the Great Recession of 2007-09.
“The change in funding will be positive for nearly every district in the state outside the five boroughs,” Brooks said.
McDonough pointed out that the state’s congressional delegation is already on record stating that its members will fight to restore the full SALT deduction. Republican Peter King, of Seaford, was joined by Democrat Tom Suozzi, of Glen Cove, earlier this month in sponsoring a measure that would do so. Nevertheless, McDonough said he saw a hard path ahead.
“It’s going to require federal legislation,” he said. “The governor keeps trying to find ways to circumvent it somehow, but I think it’ll be very difficult to eliminate that … But the $10,000 limit is terrible, especially for homeowners who are paying $20,000 to $30,000 in property tax.”
McDonough said he hadn’t seen the legislation in the budget that would phase in property valuation changes in Nassau County, but he thinks “there’s a possibility it’ll be negotiated somehow.”
Stumbling blocks, however, could include opposition from lawmakers representing other high-tax areas, and the fact that the County Legislature will also have to pass its own local law to put the five-year plan into action.
School aid, infrastructure
Cuomo’s 2019-20 budget would increase school aid statewide by 3.6 percent, or about $1 billion, to $27.7 billion. The state Board of Regents had requested $2.1 billion more, including a $1.7 billion increase in foundation aid.
Regents Chancellor Betty Rosa said that Cuomo’s proposed $338 million in additional foundation aid fell far short of what would equalize schools, or even keep up with demographic changes.
Local administrators said they had not had time to study the spending plan. The Seaford and Wantagh school districts were slated to receive more than $500,000 and $800,000, respectively, in state aid. But Wantagh Superintendent John McNamara explained that the figure was only a proposal. “It’s a snapshot from a certain point in time,” he said. “We use a different point as our reference.” Based on the 2018-19 budget, McNamara said, he estimated that his district would receive about half the amount contained in the state proposal. Assistant Superintendent for Business Adriana Silver concurred, adding that “it is still very early in the budget process.”
None of the administrators surveyed would comment officially on the 50-50 proposal. McNamara said only that he believed it was in the interest of boards of education to retain as much local control of their budget process as possible. The 50-50 plan would put Albany in charge of any portion not funded by property taxes.
Brooks said he was encouraged by the commitments that Cuomo made to upgrade the state’s crumbling infrastructure. “The roads are in bad shape, especially on Long Island,” he said, “and the [Long Island Rail Road] has been a problem for forever and a day.” Cuomo’s aggressive plan for improvements includes completion of the Eastside Access project to route LIRR trains to Grand Central Station; lengthening the Second Avenue Subway line; and easing congestion at Pennsylvania Station with the completion of the Moynihan Train Hall at the old Eighth Avenue Post Office.
“I don’t know what this budget is going to look like in the end,” McDonough said, “and I don’t know where Cuomo is going to get the money for all these things.”
Now in his 10th term, McDonough said he was prepared for weeks of committee budget hearings. After the Senate and Assembly make their changes, both chambers will meet to draft a single budget proposal before sending it to Cuomo.
“Then it’s up to three men in a room, as opposed to five, which it still should be,” McDonough said. “Now, they only have the two majority leaders and the governor. We used to have the minority leaders in there, too, which was good, because they represent a lot of the state. Now the three people are all of one political party, and they will be the tail wagging the dog.”
“What I’m telling you is, it’s too soon to know the answers,” he added, echoing local school officials. “But it has to be done by the end of March.”