New York State Assemblyman Fred W. Thiele, Jr. (I, D, WF-Sag Harbor) has announced that he is opposed to the 2016 Executive Budget Proposal which would gradually convert the STAR property tax exemption into a state income tax credit and eliminate any growth adjustment to the STAR exemption.

Under current law, property taxpayers get their Basic STAR and Enhanced STAR benefits in the form of a tax exemption. That means that the property owner gets a tax reduction directly on their tax bill and the State makes the school district whole with a direct state aid payment to the school district for the lost revenue.

Under the Governor’s proposal, new applicants would have to pay the tax upfront and then apply to the State to get the money back in the form of an income tax credit. This proposal would apply to first-time homebuyers and anyone moving from one house to another house. In addition, growth in the STAR exemption would be capped at zero percent (0%). Currently, STAR can grow by up to 2% a year. These changes would cost taxpayers over $400 million in 2017. The STAR Program currently provides $3 Billion in tax relief.

Thiele stated, “The STAR Program has been both effective and popular in helping to limit property taxes for our residents, seniors in particular. This proposal runs counter to efforts to help real property taxpayers.”

Thiele added, “This program requires the taxpayer to apply to the State to get their own money back. This ill-conceived proposal saves the money for the State because it counts on the fact that a certain percentage of taxpayers will not file for the credit because they are not required to file an income tax return, or otherwise will fail to file for the income tax credit.”

Thiele concluded, “I have supported the STAR program as well as other initiatives to reduce property taxes. This proposal is a step backward and should be rejected by the State Legislature.”

The State Budget deadline is April 1.