The Tax Shift PDF Print E-mail

Tax shifting is the practice of one government shifting its taxes, costs and/or revenue shortfalls onto a lower level of government. Stopping New York State's penchant for tax shifting is the first step in taking control of what many New Yorkers would say is our state's number one problem: the oppressive and regressive real property tax.

Just about any way you measure the property tax burden in New York, we rank at or near the top compared to all other states. Tax shifting is one of the reasons for this dubious distinction. As highlights, the state-local relationship in New York has been characterized, historically, by a pattern of the state (1) underfunding aid to municipalities, and (2) using state mandates to dictate inefficient ways in which local governments must perform services.

As it relates to state aid, though, New York has begun to provide an antidote to tax shifting and it is yielding much-needed relief for property taxpayers. In recent years, the state has made significant headway in building a tradition of predictable growth in state aid - formerly known as Revenue Sharing Aid, now referred to as Aid and Incentives for Municipalities (AIM). This renewed fiscal commitment is producing positive and measurable results. The growth in municipal property taxes is slowing. For example, there has been a net decline in city property tax levies between 2005 and 2008. It is a fair statement to make that AIM is New York's one property tax relief program that works, and works in a way that does not foster higher local spending. We thank the Governor and state legislators for their support for such a proactive, pro-taxpayer approach to state-local relations.

Now, with the state facing a daunting fiscal challenge, AIM funding could be a potential target for mid-year and future year reductions. shows that this is the wrong approach. Such a budget-balancing strategy was utilized by the state in the early 1990s and quickly put numerous New York cities into fiscal distress, some of which were taken over by control boards, and most of which still receive less aid today than they did prior to those cuts (when adjusted for inflation). AIM aid represents less than 1% of the state budget, but is an important piece of local government budgets throughout the state. urges the Governor and state legislators to maintain this relatively small investment by the state so that fiscally distressed New Yorkers will be protected from the punishing effects of property tax increases. also focuses on the other avenue for shifting taxes: state mandates. While New York has begun to make progress in its commitment to municipal aid, efforts to achieve relief from state mandates have been marked by much talk and little action. For every mandate local officials have sought to have repealed, a special interest group that benefits from such mandate has stood in the way of reform and enhanced cost effectiveness at the local government level. Now, more than ever, New York and our property taxpayers cannot afford to pay for the hundreds of millions of dollars in costs caused by state mandates. describes the real impact numerous state mandates have on the capacity of local officials to manage government costs consistent with the desires of their constituents. Our Web site allows visitors to review a comprehensive listing of nearly fifty state mandates pertaining to workforce costs, local taxation and other non-property tax revenues, government operations and procurement. The home page also features a Mandate of the Week, which delves deeper into a particular mandate, its cost to local taxpayers, and the action that can be taken by the state to provide relief from the negative aspects of the mandate. It is time for New York to put an end to the practice of dictating local policy without having to be accountable for the local tax impact of such policy.

Finally, offers all New Yorkers an opportunity to join the fight to stop any attempts at tax shifting. By clicking on the "Take Action" button on the top of the home page, visitors to can seamlessly draft and send a message to statewide elected officials, state legislators and local media.

We encourage you to spread the word about tax shifting, get involved and make sure your voice is heard. The future of our communities and our state depends upon it.