County leaders across New York are the latest to complain about the tax overhaul plan now being crafted in Congress. They predict higher taxes for many New Yorkers, declining home prices, and slowed economic growth.
Albany County Executive Dan McCoy says the federal tax bill will lead to many middle and upper-class New Yorkers paying higher taxes, because of the proposed end to state and local tax deductions. And he says the state’s over $4 billion dollar projected deficit and potential funding cuts isn’t helping either.
“Brace yourselves,” McCoy said.
And McCoy predicts housing prices will plummet all over the state if the deduction for mortgage interest is capped at houses worth less than $500,000. He says he’s been talking to some real estate agents over the past couple of days.
“And they’re recommending ‘sell your house now’”, McCoy said. “Because next year who knows what the value of that property is going to be.”
In upstate areas, average homes seldom cost more than half a million dollars, but in New York City, and its suburbs, it’s not uncommon for middle-class homes to be valued in that range.
Suffolk County Executive Steve Bellone says home prices in his county could decline by 20%, and that could have a ripple effect on housing values throughout the state. He says the effects of the tax changes are “deep” and “far-reaching”.
“More people may be thinking about relocating,” Bellone said. “More people may be thinking about squirreling away money and not spending. That’s going to have an impact on small businesses.”
McCoy and Bellone are Democrats. They were joined at the press conference by Dutchess County Executive Marc Molinaro, a Republican. Molinaro agrees that the federal tax overhaul ill “punish” New York taxpayers. But Molinaro, who is considering running for governor next year, says state leaders like Governor Andrew Cuomo bear some of the responsibility for New York’s high state and local taxes. He says the governor and legislature pass on many costly responsibilities to counties, like paying for part of Medicaid. They then leave it to local governments to levy property taxes to pay for the programs.
“We live in a state that forces more of its state spending down onto local property taxpayers than most states in America,” Molinaro said.
Molinaro also takes issue with some of Governor Cuomo’s strong language against the tax overhaul measure. Cuomo recently told newspaper editorial boards that the measure would “rape and pillage” the state, and he’s repeatedly called GOP House members in New York who voted for the tax plan “traitors”, and “Benedict Arnolds”. The governor repeated those accusations in a conference call with reporters on Thursday.
Molinaro says that language goes too far.
“It’s not becoming from a President or from a governor to say to people that your particular political position is akin to treason,” Molinaro said. “If in fact, you hope to have those people to work to provide real leadership to resolve a problem.”
Suffolk County Executive Bellone says he thinks it’s important that the governor speak “passionately and directly” about the issue.Albany County Executive McCoy says he is also OK with the governors rhetoric, and that he and Molinaro will just have to “agree to disagree”.
Governor Cuomo’s spokesman Rich Azzopardi, in a statement, defended the governor’s remarks.
“We make no apologies for fighting like hell to stop a tax plan that will devastate the people of New York,” Azzopardi said. “If he isn’t outraged by the way his fellow Republicans have sold out their own constituents and raised their taxes, then that tells you everything you need to know.”
The county executives, in a resolution passed during their annual board meeting in Albany, are appealing to President Trump and the New York congressional delegation for changes.