NY Leg: End STAR rebate's check system

ALBANY - State lawmakers are united: They want the state's STAR rebate program to go back to the way it was.

The Legislature's various factions are unanimously backing a measure to switch the school-tax rebate program back to a tax exemption, scrapping the state's current system of mailing checks to new homeowners who qualify.

The Republican-led Senate and Democrat-led Assembly both included the measure in their budget proposals this week.

The check-based system was approved by Gov. Andrew Cuomo and the state Legislature in last year's budget.

But homeowners and assessors have been highly critical of the switch: Many checks arrived late to homeowners, leaving them to pay their full school-tax bill up front last fall and wait for reimbursement from the state.

"The results have been disastrous," Assembly Minority Leader Brian Kolb, R-Canandaigua, Ontario County, said in a statement last week.

"Instead of getting a tax break up front, individuals have been forced to wait for checks that have been delayed, inaccurate, or haven’t arrived at all. It’s time to go back to the original program."

The state's $3 billion STAR rebate program helps homeowners who earn less than $500,000 a year, with seniors eligible for Enhanced STAR, a higher benefit.

The check-based system applies only to those who bought a home since August 2015. Those who purchased before then still get the tax exemption.

There's bipartisan support in the Legislature to go back to the old system, which allowed all qualified homeowners to receive the exemption on their tax bill rather than wait for a check from the state.

On March 1, the Assembly unanimously approved a bill to switch back to the old system.

Senate Republicans signaled their support this week when they included the measure in its budget proposal, as did Senate Democrats and the Independent Democratic Conference.

Now, it will be up for debate as Cuomo and lawmakers negotiate a final spending plan, which is due March 31.
A spokesman for Cuomo did not immediately respond to request for comment Wednesday.

A memo attached to the Assembly's bill makes the case that the exemption "provides the (tax) relief upfront."

"This distinction is important as many taxpayers, especially those with lower incomes, have difficulty paying their school tax bills in their entirety and waiting for a reimbursement check," according to the Assembly's memo.

Basic STAR last year amounted to an average credit of $750, while Enhanced STAR for seniors averaged about $1,400.

Cuomo has also proposed capping the growth of the STAR credit, which currently increases by up to 2 percent each year.

Lawmakers don't appear to be on board with that proposal, either. The Senate's budget rejects it outright, keeping the inflation increases intact.

The Assembly and Senate were set to approve their individual budget proposals Wednesday, though the resolutions were largely ceremonial.

Negotiations with Cuomo on a final budget will continue for the next two weeks. The state's fiscal year starts April 1.

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