Don't Replace Property Tax With A New Income Tax. . .

. . . Try An Old One -- The State Income Tax

With all the talk of what to do with the onerous property tax -- including the prospect of a local income tax -- we sometimes overlook the obvious; like using revenues from the existing State income tax to fund our public schools.

Marc Bernstein, a school Superintendent in Valley Stream, suggested just that in a recent Op-Ed piece in The New York Times.

Hmm. Use an income tax we already pay to financially support our schools. And if Albany would actually return a greater share of Long Island's State income tax dollar to the island's school districts, the school portion of the property tax could be eliminated without even having to increase the State income tax burden.

Absolutely brilliant!
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A Smart Tax

By Marc F. Bernstein

Most of Long Island's schools dodged the bullet of budget defeats in last week's votes, reversing a two-year trend. The reasons for only 14 percent rejection compared with 36 percent last year are simple: significant amounts of additional state aid and the lowest spending increases in seven years led to lower property tax increases.

Unfortunately, it's unlikely that the state can continue to find more money for the suburbs as it meets its court-ordered responsibility to pay billions more to New York City. Moreover, I doubt that the schools will find new ways to keep their budget increases to this year's level — we've cut what can be cut. What we need is the state income tax to replace the property tax as the primary source of money for our schools.

Though Long Islanders continue to be proud of their excellent schools, they won't have the money to pay their school taxes, huge monthly mortgages and skyrocketing energy bills. If we were to make the income tax the main way to pay for schools, we would lower residential property taxes, bring equity to school expenditures in our school districts and slow the rate of increasing school expenses.

If we don't find a way to eliminate or significantly reduce the property tax, educational programs may be unmercifully cut and people may leave the Island in droves.

Using the state income tax to pay for schools could be accompanied by the state's establishing a common spending level for all students, adjusted by region. Thus, parents would be assured that their children will receive a sound basic education no matter where they live and regardless of the school district's property wealth. And if the state was required to pay for all new programs it mandates and districts had to make choices within a fixed budget ceiling, yearly increases in school expenses would be significantly limited.

The path toward setting a guaranteed state-financed minimum for per pupil spending has been paved by the decision by the state's highest court in the landmark Campaign for Fiscal Equity case. With the Court of Appeals having ruled that the state must provide additional money to pay for New York City public schools, other school districts are likely to bring their own lawsuits to try to compel the state to provide more aid to them as well. We could pre-empt these suits by having the state pay for education while eliminating the local school property.

How would this work? The state would establish a common per pupil expenditure level. Each school district would receive state aid commensurate with its number of students, regionally adjusted for the cost of living and taking into consideration that students with special needs require disproportionately higher spending.

Of course, there are issues that must be dealt with before this change in expenditure control and revenue allocation can be made. For example, some communities may insist on spending more money than the state has provided, and they should have the right to do it through a county income tax, sharing the county's commercial property values or through a special resident property tax that they impose on themselves by a supermajority vote.

A survey of Long Islanders released by the Rauch Foundation late last year showed that 55 percent of respondents thought that paying for schools through the income tax was a good idea. Clearly, the people of Long Island understand that this solution will control education expense and equalize educational opportunity while eliminating the burdensome and regressive local property tax.

Marc F. Bernstein is the superintendent of the Valley Stream Central High School District.

Copyright 2006 The New York Times Company
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Great idea, Marc. We wonder if any of our state legislators -- and, perhaps, candidates for Governor -- are reading this?
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Click HERE to read Joye Brown's Talk of the Towns: Property Taxes