BALCONY - Business and Labor Coalition of New York

New York City mayor: Don’t cap state property tax

June 8th, 2009

by Joan Gralla

New York City Mayor Michael Bloomberg on Friday said he opposed the governor’s plan to cap property taxes because it was “undemocratic” and could require the city to pay for the extra costs that result.

Outside New York City, property taxes are the main way that counties, cities and towns raise money. If they can raise property taxes only 4 percent or less each year, the state likely will have to pay more of their budgets, and probably will siphon more of New York City’s tax dollars.

Bloomberg, an independent seeking a third term, on his weekly WOR radio show faulted some other cities for overpaying their workers, saying: “It’s going to become an obligation of the state, which means it’s going to become an obligation of the city.”

Every year New York City, whose economy powers the state, sends the state billions of dollars more in tax revenue than it gets back in aid.

Democratic Governor David Paterson says the property tax cap is needed to cut some of the nation’s highest rates which choke economic growth.

Also, banks’ wariness of real estate loans could lengthen the recession by imperiling job-creating construction projects.

A spokesman for the governor was not available for comment.

Bloomberg cited a range of problems with a plan to improve Manhattan’s Pennsylvania Station by moving its entrance a block west to the James A. Farley Post Office.

Not only were multiple levels of federal and state approvals needed but the design was too complicated.

“You’d have to go through so many twists and turns underground; nobody would want to use it because it would take so long to get down to the track,” Bloomberg said.

Any improvements for the overcrowded transit hub might be limited to just opening up space at Cablevision’s (CVC.N) Madison Square Garden, which sits on top of the station, he said.

Spokesmen for two developers that planned a massive complex around the new Pennsylvania Station, Vornado Realty Trust (VNO.N) and the Related Companies, were not available.