Governor offers $70M challenge for municipalities to merge, be more efficient

Posted 8 January 2016 at 12:00 am

Press Release, Gov. Andrew Cuomo

Gov. Andrew M. Cuomo today unveiled a new proposal for his 2016 agenda – a Municipal Consolidation and Efficiency Competition designed to reward local governments that take real steps to make living and working in New York State more affordable.

The competition will challenge counties, cities, towns and villages to develop innovative consolidation action plans yielding significant and permanent property tax reductions. The consolidation partnership that proposes and can implement the greatest permanent reduction in property taxes will receive a $20 million award.

“We’ve made tremendous progress over the past five years to make New York more affordable, and this year we are going to keep that momentum going from the ground up,” said Governor Cuomo. “This competition will help local governments find innovative ways to reduce costs and lower taxes for their constituents – which will make it cheaper to live, work and thrive in their communities. This is about building a stronger and more prosperous New York over the long haul, and I am eager to help our local partners across the state move forward.”

This would be the largest direct incentive ever offered for communities to work together to share services, cut costs and lower property taxes. This will be part of $70 million in this year’s budget to incentivize local government consolidations, reorganizations and efficiencies that result in the taxpayer savings.

For years, local property taxes in New York have been among the highest in the country, negatively affecting New York’s economic competitiveness and the quality of life for its residents. Between 2000 and 2010, property taxes grew at an unsustainable rate – more than double the rate of inflation.

In 2011, the governor enacted the Property Tax Cap. As a result, property taxes have been held to an average growth rate of approximately two percent during the past three years, less than half the rate of growth over the previous 10 years.

The cap was strengthened in 2014 with a property tax freeze program that encouraged local governments and school districts to comply with the tax cap and develop approved government efficiency plans to reduce costs. A new Property Tax Relief Credit was created in 2015 to progressively target an additional $1.3 billion in property tax relief for New York homeowners over the next four years.