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May 31, 2011

Counties Answer Property Tax Cap Agreement with Mandate Relief Proposal

Medicaid Relief Must Be Property Taxpayers Next Priority

Calling on State Leaders to live up to their commitment to address mandate relief with a property tax cap, county leaders today put their number one mandate relief priority on the table: a State takeover of the local Medicaid costs.

Under the proposal, effective April 1, 2012, the State would begin to assume the $2 billion county share of Medicaid for the 57 counties outside New York City (NYC is exempt from the property tax cap). Over a multi-year period, the State will assume the full $7.5 billion local share of Medicaid (including NYC).

Importantly, the proposal would leverage federal and state resources to significantly minimize State general fund risk. The entire cost would be offset with resources available through Federal funding, taking advantage of new flexibilities in the Health Care Reform Act, and savings from this year"s State Medicaid reform measures.

"County property taxes are driven by State spending on Medicaid and other mandated programs and services," said NYSAC President William J. Ryan, a Westchester County Legislator. "This proposal removes Medicaid from the property tax base once and for all, and provides a way for the State to deliver actual property tax cuts for overburdened homeowners and businesses."

In 1968, then Governor Nelson Rockefeller created the State Medicaid program that required a county contribution of $120 million. In the last five decades, the county contribution has increased to more than $7.3 billion in 2010. County property tax increases are a direct result of paying for Medicaid, and other health, human services, and public safety programs that the State has instituted since them.

"This is and always has been our number one Mandate Relief priority. It will lead to lower property taxes and provide a much greater benefit to New Yorkers and improve the overall administration of the Medicaid program," said Monroe County Executive Maggie Brooks, president of the NYS County Executives Association.

"A cap on the local cost of Medicaid enacted in 2005 has enabled counties to stabilize property taxes. A State takeover would allow us to live within the cap and in some instances eliminate them altogether," said NYSAC Executive Director Stephen J. Acquario.

Medicaid is one of 9 State mandated programs that consume 90 percent of the county property tax levy statewide, and these 9 represent only a small portion of the 40 mandates imposed on counties. Counties will continue to advocate for reform of all 9 programs. In light of the tax cap agreement announced by State leaders this week, counties are urging State leaders to start with just one-Medicaid.

The New York State Association of Counties is a bipartisan municipal association serving the counties of New York State including the City of New York. Organized in 1925, NYSAC's mission is to represent, educate and advocate for Member Counties and the thousands of elected and appointed county officials who serve the public.


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