By Tom Wanamaker
TIMES ALBANY CORRESPONDENT

At a Monday press conference in Albany, party leaders, tax advocates and a bipartisan group of almost three dozen members of the Assembly outlined a two-part strategy to ease the state’s increasingly heavy local property tax burden, while simultaneously maintaining the revenue stream supported by these taxes.

Working Families wants to see a property tax “circuit breaker” that would cap the amount of taxes paid as a percentage of income. At the same time, the party favors an increase in the income tax rates for wealthier taxpayers to compensate for funds lost under the circuit breaker.

“We want to provide serious relief for middle-class families and senior citizens,” said Daniel Cantor, the party’s executive director. “This costs money.”

Mr. Cantor said the way to pay for the circuit breaker is to repeal a “modest amount” of the tax breaks given to the state’s wealthiest taxpayers.

“We want to shift the burden off property taxes to higher income taxes. This is progressive, sensible and equitable,” he said.

A circuit breaker works by capping the percentage of household income a homeowner must pay in property taxes. In one example offered by Working Families, a household with an $80,000 annual income would pay no more than 6 percent of its income in property taxes, amounting to $4,800. Any property tax paid over that amount would be returned to the taxpayer, either partially or fully, as a rebate.

Working Families said 43 percent of all New Yorkers “would see immediate help” in reducing their property tax burdens. As proposed, the circuit breaker would cost the state about $3.9 billion in revenue.

To pay for it, the income tax rates on the state’s wealthiest 1 percent of taxpayers would rise, on a sliding scale, from 9.35 percent on incomes between $500,000 and $1 million to 13.85 percent on incomes of more than $10 million. This, Working Families says, would raise $6.5 billion, which could be used to further reduce tax pressure or decrease the state’s budget deficit, or for other purposes.

Currently, the state’s top personal income tax rate of 6.85 percent is paid by all single individuals earning more than $20,000 annually and by households earning more than $40,000.

“It is unfair that a family making $45,000 pays the same tax rate as a family making $4.5 million,” said Ronald Deutsch, executive director of New Yorkers for Fiscal Fairness. “We need to increase the top rates of the personal income tax to restore progressivity. This is targeted tax relief to those who need it most.”

Circuit breaker legislation is pending in both the Assembly and the Senate. In February, Assemblywoman Sandra Galef, D-Ossining, and Sen. Elizabeth O’C. Little, R-Queensbury, introduced bills in their respective houses to create separate circuit breakers for upstate (north of Dutchess, Orange and Putnam counties) and downstate. The Assembly bill is A.1575A; the Senate bill is S.1053A.

On Monday afternoon, Thomas R. Suozzi, chairman of the state Commission on Property Tax Relief, said his commission would issue its preliminary report June 3. The commission was created in January by former Gov. Eliot L. Spitzer to study the causes and effects of the state’s high property tax burden and recommend solutions.

The commission originally was supposed to issue its report “no later than May 15,” according to Mr. Spitzer’s executive order. Its recommendations are expected to include some form of property tax cap.