New York state taxes: Long Island loses again – By George J. Marlin

The following appears in the April 20-26, 2012 issue of the Long Island Business News:

Last December New York State Senate Majority Leader Dean Skelos and his merry band of downstate suburban Republican senators enthusiastically embraced Gov. Andrew Cuomo’s so-called tax-reform legislation. The reality, however, is that the enacted law, which projects $2 billion in additional tax revenue, actually raises taxes on many overburdened suburban taxpayers.

The downstate senators apparently did not grasp the consequences of their actions. By yielding to the temptation of political expediency (an apt motto for the group is Oscar Wilde’s epigram, “I can resist everything but temptation”) they are hurting the very constituents who elected them to office. Not only will higher taxes drive more of suburbia’s wealthiest to lower-tax states, those left behind will forfeit more of their income to Albany and will get in return proportionally less in state-funded aid.

Every year New York’s Department of Taxation and Finance collects approximately $80 billion in fees and taxes on personal income, corporate profits and sales. The bulk of those dollars are then distributed to fund various local programs and services throughout the state. Services include education, transportation, public safety and health care.

A recent study commissioned by the Citizens Budget Commission and performed by the Nelson A. Rockefeller Institute of Government at SUNY Albany confirmed what most Long Islanders have long suspected: “New York City and the downstate suburbs give far more to Albany in revenues that they get in state-funded expenditures.”

Downstate suburbia contributes about 27 percent of the total tax dollars that go into the state coffers but receives about 17 percent of state aid. In other words, for every dollar paid in taxes, only 72 cents returns in the form of state aid.

Upstate residents benefit the most. For every $1 they send to Albany they receive back $1.69. That explains why upstate Republican legislators – who hypocritically swear allegiance to the principles of fiscal conservatism – happily vote for higher state taxes. They know their regions will benefit the most and will be required to spend the least. That’s because most of the wealthiest in the state live in New York City or its suburban bedroom communities.

When it comes to state aid to public schools, downstate suburban counties are also shortchanged. In fiscal year 2009-2010, for example, Nassau County received $935 million in school aid or $692 per capita, and Suffolk County received $1.795 billion or $1,183 per capita. Western New York’s Erie County, however, received $1.213 billion, which translates into $1,382 per capita.

Get the picture? Long Islanders are paying more to get less from Albany.  And thanks to income tax increases that go into effect this year, they will be contributing even more to state coffers.

Skelos and his suburban confreres were rolled last December. Instead of taking deep bows they should be hanging their heads in shame.

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