County Officials Will be Required to Prepare Plans For Shared, Coordinated and Efficient Public Services
State Matches Net Savings of Plans That Eliminate Duplicative Services and Unproductive Government Overhead For Real, Recurring Property Tax Savings
Major Component of Governor’s Middle Class Recovery Act – Builds on Actions to Reduce the Burden of Local Property Taxes, Including the Property Tax Cap
Governor Also Announces Impact of Proposal to Eliminate State and Local Deductibility from Federal Taxes
New Website Launched Detailing County-Wide Shared Services Initiative and Citizen Participation at www.ny.gov/SharedServices
Earlier today, Governor Andrew M. Cuomo signed landmark legislation to empower New Yorkers to control the cost of local government by requiring counties to assemble local governments and find efficiencies for real, recurring taxpayer savings. To ensure transparency and an active role for citizens in reducing their tax burden, public hearings will be required as part of the development of shared services plans. The FY 2018 Budget continues the Governor's efforts to relieve the property tax burden by building on the success of the two percent property tax cap and requiring local governments to develop county-wide shared services plans.
The Governor also announced the potential impact of a proposal by the federal government to eliminate the ability for New Yorkers to deduct state and local taxes from their federal tax returns. On Long Island alone, approximately 950,000 taxpayers would see their taxes increase $4.3 billion, an average of almost $4,600 per taxpayer. More information is available here.
VIDEO of the remarks is available on YouTube here and in TV quality (h264 format) here.
AUDIO of the event is available here.
PHOTOS of the event will be available on the Governor's Flickr page.
A rush transcript of the Governor’s remarks is available below.
Thank you. Thank you very much. Thank you very much. It is my pleasure to be back, I brought the beautiful weather, I want you to know. It is beautiful out there and it’s beautiful to be back here in Suffolk.
First, to your county executive who’s really one of the best in the state and the leadership of the county executive is more important than ever before. Give him a big round of applause, County Executive Steve Bellone.
To my colleagues from Albany, I don’t like when the county executive says Saladino is happy to be out of Albany. I wouldn’t say that. Like if I came here and said, “You know, they’re glad to be out of Suffolk County.” That’s really not an endearing thing to say to someone. “Oh yeah, they finally moved from Suffolk, thank God, they couldn’t wait to get out.” I wouldn’t do that. You miss Albany, don’t you Joe? See? You weren’t even right. Give Joe Saladino a round of applause. Truth doesn’t always count, Joe.
To my colleagues from Albany, Phil Boyle who’s worked extraordinarily hard on behalf of the island in general, and specifically on the issues of taxation. He’s done a great job. Phil, pleasure to be with you. Phil Ramos and I were together two weeks ago, working on the issue of MS-13. We brought in the state police to be helpful, we brought in additional resources. Recently, they had a breakthrough with more arrests on MS-13. That involvement really, and the partnership with the state is very important and that was because of Phil Ramos. He’s really an extraordinary leader. Pleasure to be with you. Assemblyman Fitzpatrick, who is always watching the state budget. I listen to his debate, he goes line by line through my budget. It’s not the most pleasant experience but he’s watching your tax dollars. Great to be with him, give the Assemblyman a round of applause. John Kaiman abandoned the state to work for the county, but good to be with you John, he’s an extraordinary public official. It’s good to be with you. I want to thank the laborers very much for their hospitality and hosting us today. Let’s give them a round of applause.
The topic we’re going to discuss today is vitally important and incredibly difficult. It’s that fine line between both. First, we’ve made a lot of progress. The past few months, what we’ve done on the state side passing the state budget, there’s a lot of good work that’s done in the state budget. This was probably the most difficult budget that I have done – this was a difficult baby to birth, she came late, but the budget was actually beautiful when it was actually done.
It did a lot of good work for us - more education aid than ever in the history of the state of New York. We have the first college affordability program in the United States of America that says to every child, you can go to college. That is smart, not just because we’re giving individuals the opportunity to go, and it’s not a question of affordability anymore, every child has that dream. It’s also smart for the state. You know, this state at one time had the most educated workforce in the country. We’re now number 11. This country had the most educated workforce on the globe, we’re now number 12.
You know where businesses are going? Where the educated workforce is. So having our population the most educated is good individually and it is also good collectively. We passed a piece of legislation called raise the age, which is way overdue, but says to 16 or 17 year olds, we’re going to understand that you’re 16 and 17 years old and they can make a mistake without getting a criminal conviction that’s going to eliminate any possibility for the rest of their lives.
We have the most aggressive building program in the state’s history. I would bet you that we have the most aggressive building program in the nation. We’re rebuilding this state because the truth is, we relied on our forefathers’ legacy for too long. Not even our parent’s legacy, our grandparent’s legacy. When was the last time we built a new highway? When was the last time we built a bridge? When was the last time we built a tunnel? When was the last time we built an airport? When was the last time that this nation has built an airport? It’s been 20 years since there was a new airport in this country. It’s a disgrace. You fly all over the world, you see world class airports everywhere. Then you fly into New York and it’s like you’re flying back in a different generation. Denver was the last airport. So we’re rebuilding John F. Kennedy airport, we’re rebuilding LaGuardia Airport, we want to reform MacArthur airport, we’re finally making progress on the Long Island Railroad, which is long overdue. I mean a more incredibly bizarre situation, you couldn’t have other than the LIRR.
Every morning, head of the MTA, gentleman named Tom Prendergast, he just left, I turn on the TV – delays on the LIRR. What else? I’d call up Tom, what happened now? “Well, this happened on THE track.” It was always on THE track. Why did he say THE track? Because there’s one track, that’s why. If anything happens on THE track, everything stops. Well, why don’t we have a second track? Or a third track? So when something happens on the one track, we have redundancy? Well we’ve been talking about that for 30 years. But we just haven’t been able to get there. Why? Well, there’s NIMBY, there’s opposition from people who live next to the track that don’t want a train.
You know what? There’s always opposition. There is no big thing you can do where 100 percent of the people are going to say, “I agree.” And you can’t have a situation where a handful of opponents stop all progress and that’s happened on Long Island for too long. I mean, on the merits it makes sense. Fine. But when it’s just a number of the opponents who were never going to say yes just because they’re in love with the word no, or there’s some particular interest. We can’t let nimby be the rule of the land and progress. And I’ll tell you, the politics and the politicians who pander to nimby, their day is over. Because if you want to pander to the vocal minority – you better hope that there is no vocalization from the majority otherwise you’re going to have a problem. So we’re going to get that second track done and we’re going to get that third track done.
We’re going to redo the Farley Post Office to have a real train terminal, rather than endure the pain of Penn Station. So, a lot of good things are going on. And on probably the most important issue in the state – which is the issue of taxes, especially on Long Island – the state is doing everything it can. Our tax rates are down across the board. I know cynicism, “well I can’t believe government reduced taxes.” We reduced taxes. It’s a question of numbers, not words. Everybody in New York pays less taxes today than the day I was elected. Period. That is a fact. We have the lowest corporate tax rate since 1968. Lowest manufacturing tax rate since 1917. Lowest middle class tax rate since 1947. Well, if the taxes are so low, why don’t I feel the taxes are so low? You know why you don’t feel the state taxes are so low? Because the state taxes are just a fraction of what you pay. You pay five times more in property taxes than in state taxes. Five times more. That’s why you don’t feel the reduction in state taxes. See, to tell you the truth, I feel a little badly that nobody says “Thank you for reducing my state taxes.” Thank you, just you. Thank you – what’s your name? Thank you very much, you’re the first person that’s thanked me in six years.
But the reason they don’t thank me is they don’t feel it because it’s a smaller part of the taxes. The real tax burden in New York is the property tax – individual or business. When people say, “I’m leaving New York. I can’t take it anymore.” They’re talking about the property tax. Now, we did do something about property taxes. We passed the property tax cap. Property taxes were going up seven, eight, nine percent every year. It was crazy. We passed the property tax cap in Albany, when Joe Saladino was there – the good ‘old days – that said, local governments can’t raise property taxes more than two percent, unless they get a super majority. That brought increases from seven, eight percent, down to two percent. Like overnight. But, a two percent increase is still an increase, right? And with the economy today and the pressure people are feeling today, a two percent increase is not good enough. We have to try to reduce the property taxes. Now, how do you do that? You have to go to the local governments and say, “We need to find a way to reduce local property taxes.” Now, local governments are going to say this, “I am doing everything I can do to reduce my budget. And I talk to county executives, mayors, supervisors all across the state. I’m doing everything I can to reduce my budget. There’s nothing else I can possibly do and I resent you for suggesting that I can reduce my budget. I’m sorry that you resent me, but I’m getting used to it. I don’t accept the premise that you’re running a perfect organization. I am not running a perfect organization. I don’t believe that there aren’t more efficiencies that one can find from government. Right? I believe there’s always more efficiency that you can find and this is not our money that we’re spending. We’re spending taxpayer’s money and therefore we owe it to them to make it as efficient and lean as possible.
The second point is this: we have to change our basic model and change our basic thinking. Even if you are running the prefect government. You have the perfect town government. There’s not an ounce of body fat on your government. You are running the perfect, lean organization. There’s still a problem and the problem is, in Suffolk you have more than 400 local governments. Think about that volume – 400 local governments. So, even if you want to say all 400 are perfect. It’s never happened before in the nation, but it happened in Suffolk County because it’s Suffolk County. All 400 governments are perfectly efficient, then I have another question for you – the 400 governments now operate like they’re all in a separate business and they’re all separate entities and they have no connection one to the other. But that’s not true. If you had a private company providing a service in Suffolk County, do you really think they’d be running 400 separate organizations? No centralization? No shared services? You'd have 400 individual fiefdoms. It would never happen. "Well we are 400 individual fiefdoms." No you're not. You are all in the basic business of providing community service and public service. Talk among those 400 and find out how you can do your job more efficiently and saving money.
Not everyone has to do everything. Not every government is a country unto itself. You can find efficiencies among yourselves. Do you know, I challenged the county executive and local officials, when was the last time all 400 got together and had that conversation? When was the last time you put all 400 governments in the same room and said, "Hey. People. We're all in basically the same business. These property taxes are a killer. They're the highest in the United States of America. Let's figure out how to do shared services, cooperative services." The conversation has never happened. So you can't tell me that a conversation you never had, there's no possibility to find inefficiency.
Now, you can say to a County Executive, "Well, why don't you manage the 400?" You know why? It's not the County Executive's job. The County Executive does not have that power. It's a misleading title, "County Executive." Sounds like he runs the 400 governments. Now I blame him for the 400 governments, just because I can. I sort of enjoy it a little bit but he has no legal authority over those 400 governments. They run themselves. He runs his county government. But up until the law we're going to sign right now, he's had no power to call those 400 governments together. This law says, "County Executives shall convene all 400 to have a conversation you've never had before. To say to those 400 perfect governments, perfect body, fat governments, whatever the perfect body fat percentage is. Let's see how we can share services. We're 400 local governments. We have 126 offices in Suffolk County. 126 government offices. Anybody have any vacant space in your government office? Maybe we can consolidate some space and save money. We buy over 4,000 pieces of heavy equipment. 4,000 pieces. Does everybody have to buy these pieces of heavy equipment that we only use a few times a year? Can we find a different way to do that? Can we find a way to do purchasing together? And share our purchasing power? Can we find a way to do human resources together? Can we find a way to buy insurance together? There have to be ways to find savings among us once you give up the illusion that we are 400 separate entities. That's what this law says.
County Executive Bellone, convene the 400 and have the conversation. Now I'll tell you what's going to happen in the conversation. Everybody's going to be like this. Everybody's going to be like this. "Oh no, my organization is perfect. Share? You want me to share? Share with who? You want me to share with my next door neighbor, Saladino Oyster Bay? I don't like Saladino. I never liked Saladino. I was happy when Saladino was in Albany. I'm sorry he's back. I hope he loses this next election, Saladino. I'm not sharing my truck with Saladino. Plus Saladino doesn't know how to drive my truck. He's going to ruin my truck. I'm fine the way I am. I'm not going to cooperate with Saladino." Well, how about on the other side? How about Tom on the other side? "I hate Tom too. We all hate each other. And I'm not going to do anything." That's what the County Executive is going to run into.
What do we do? That process will all be public. There will be hearings. People will attend. They'll be televised. They'll see the town official saying, "I hate Saladino and he's not driving my truck and therefore I'm going to buy another truck for another $200,000 and have my people pay for it. Just because I don't like Saladino." And he's going to have to say that on TV. And they're going to come up with a plan and they're going to issue that plan to the public and every elected official has to put out a letter explaining their position to their constituents as to why they voted for the plan or against the plan.
You know the ultimate power in politics is the people. Now, they're not going to do it for me. Because I've tried incentives, I've tried sanctions, I've tried everything. But the voters have had enough. They are up to here. And they can't pay any more property taxes and if they find out, and when they find out, that because 400 governments don't want to play nice with each other, they're paying a higher property tax bill? They are really not going to be happy. And I believe the elected officials are going to get that. And that is the real power that the County Executive has going into that meeting, that we’re going to have to explain this product to the people. They cannot accept the proposition that 400 governments in one county – we couldn’t figure out a way to save money. It is incredible and implausible and politicians are smart. No one is going to want to go back to their voters in their town or their village and say, ‘Oh yeah, we couldn’t figure out any way to save money.’ If you save just three percent, it’s $384 million. That’s how much money we’re talking about.
Now, last point – I promise. This is why this is more important than ever before. ‘But we always pay high property taxes. That’s just the way it is. We’ve been on Long Island. I know. I’ve heard this. We pay property taxes. They’re very high. Highest in the nation.’ Highest in the nation. Nassau and Westchester go back and forth, number one and number two in the nation – highest property taxes. ‘But you know, there’s nothing we can do about it.’ A, that’s false. This is a new approach and I believe we can have success. B, if we don’t do something about it, we’re going to have a real problem because there is now a federal law that is pending that will be devastating to Long Island. What the law says is, you can no longer deduct your State and local taxes.
Now, that sounds technical. Right now, when you – you pay your State and local taxes, but you get to deduct that amount from your federal taxes and that reduces your federal income by the amount you pay taxes. Therefore, you’re not taxed on that amount federally. The federal government says, ‘we’re going to do away with that deduction and you’re now going to be taxed twice. You’re actually going to being paying your State and local taxes – property taxes – and then you’re going to be taxed federally on the amount that you pay.’ That will increase most peoples’ tax burden between 30 and 40 percent. Alright? The numbers are devastating. It affects about 1 million people on Long Island. It will cost Long Island $4.3 billion; average cost for a Long Island family – are you ready? $4,500. $4,500.
So, we have to get the property taxes down. Not just because they’re too high in and of themselves. If this federal law passes, and by the way with this Congress, nothing would surprise me and this is an incredibly popular proposal in Washington. Why? Because it makes Washington money. That’ why. It gets them more tax revenue. That’s why. And they’re always looking for things to get them more revenue because the Congress wants to do a tax cut for the very rich; they have to find the money to do the tax cut for the rich. This is going to be one of the great sources of funding to fund the tax cut for the rich. We’re going to fight this like heck. We’re going to organize our federal delegation. We’re going to organize everyone. I’m going to go to Washington and do what I have to do: yell and screen and lay myself on the floor of Congress. But, this is a real possibility and that’s why this issue is more critical than ever before.
I want to thank the County Executive for stepping up to the plate. This is one of those that, frankly, will be an incredibly difficult exercise. When he stands up in front of 400 local officials and says, ‘I want you to do something you’ve never done before’ which is cooperate this way and share services this way and give up control – we like control – give up control, that’s an incredibly difficult conversation. It’s going to take an incredibly strong leader and courageous leader to do it and that we have in Steve Bellone and we’re lucky for it. Let’s give him a round of applause.
For Mr. Bellone, before I sign the law let me leave you with this one: I spend about half the year in Albany when the Legislature is in session. I don’t send as much time there anymore because Joe’s not there and we used to hang out. It’s not the same since Joe left. But in Albany, they have the Governor’s Mansion, they call it. It’s not really a mansion; it’s a big old house. But they call it a mansion. It makes them feel better. So, it’s me alone when I’m in the house because my family’s in Westchester. The kids are in school. So it’s me alone. There are stories that this house is haunted. Now, I don’t believe in ghosts and I’m a big tough Italian guy. But I’ll tell you – it gets creepy in that house and there a lot of noise that go on and you are very alone. So, I stay up and I do a lot of reading. I love to read about the history of New York and the past Governors of New York. In my opinion, two of the greats were Franklin Delano Roosevelt and Teddy Roosevelt. Putting aside my father, who was the greatest.
But, FDR – FDR and Teddy Roosevelt had the same basic operating philosophy. They said it different ways and they manifested it different ways but they said the same basic thing, which is: ‘You’re in government for a limited period of time and the time goes very quickly and the trick is to make a marked difference in peoples’ lives while you’re in government.’ That’s why you’re in government. To make a difference in peoples’ lives. Not to talk about it. Not to issue a press release saying I’m trying to do it. Not to explain why it can’t be done. To actually achieve it and both of them have the same philosophy. They said when they were there, ‘Give them the tough problems.’ Not the easy problems. Let somebody else do the easy ones. They were there – they wanted to do the tough ones that had been around for a lot of years because the tough ones would make a significant difference in peoples’ lives. We make a difference in this property tax problem on Long Island, you will change the trajectory of Long Island. Home values will go up. Young people will stop leaving. Jobs will start returning. It is the single biggest thing that can be done. It is also the single toughest issue to take on – and that’s why we’re in the situation that we’re in. Because it’s grown incrementally and nobody’s had the guts and the courage and the strength to stand up and take it on. And I’m saying the time is now.
Remember Teddy Roosevelt; remember FDR. You have a great County Executive. Local officials: get beyond yourself. It’s not an attack on you and your autonomy and your management. The government of the next generation is a collaborative government that works together and gets beyond itself and recognizes that we’re all in the same business – whether you’re repairing a road in one town or another. It’s doesn’t matter. It’s a truck and personnel and asphalt. We have to work together if we want to make Long Island the Long Island we want to make it. I believe we will. Let’s sign the bill.