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September 02, 2014
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Your local property taxes; The second in a series of articles

Ken Hilton

The first article in this series (published in the December 26, 2013 issue of The River Reporter) focused on the comparative cost burden of Sullivan County’s property taxes. It revealed a sobering fact: measured as a ratio of the incomes of the county’s residents, our property taxes rank among the very highest in the entire country. Indeed, our “property tax effort”—our ability to pay—places our taxes in the top 1% nationwide. Property taxes take almost 7% of the annual incomes of Sullivan County residents, while typical homeowners elsewhere in our nation pay less than half this much.

This, the second installment in a series of articles on Sullivan County’s property taxes, provides a brief overview of the kinds of services local governments provide to their residents in return for their property taxes.

Within the boundaries of New York State (NYS), we have hundreds of local governments, each with its own governing body and its own taxing authority. These include 57 county governments (excluding New York City’s five boroughs), 62 cities (ranging in size from eight million residents to 3,000), 932 towns, 551 villages, 699 school districts, and over 7,000 special-purpose districts, including library districts, fire districts, water and sewer districts, housing and transportation authorities, and many others. Here, in Sullivan County, besides our county government, we have 15 town governments, 21 village governments, eight school districts, eight library systems, plus dozens of fire districts and other special-purpose districts. Together, they provide services to a county of about 75,000 residents—0.3% of the NYS population.

Though local governments differ somewhat from state to state, and even within individual states, they traditionally have provided “close-to-home” services to their residents, i.e. those services perceived most necessary for day-to-day living. These include such things as public schools; police and fire protection; water and sewers; public lighting and in some places electricity services; garbage collection and waste management services; maintenance of sidewalks, roads and bridges; public transportation; airports; hospitals and public health services and the delivery of social services, such as aid to dependent children, funding for Medicaid and services to the elderly, the disabled and youth. Local governments provide oversight and enforcement of building, fire and health codes. They issue hunting and fishing licenses and building permits. They provide local court systems, employing judges and prosecutors. They operate jails, prisons and probation systems.

Most local governments provide recreation and cultural services for their residents, operating libraries and parks, maintaining playgrounds, and sometimes even running museums and stadiums. Local governments try to closely manage land usage, ensuring that environmental laws are enforced, passing and enforcing zoning and building regulations. As you might expect, most counties, towns and cities have various planning boards that try to anticipate future community needs in land usage, transportation and environmental concerns. Finally, local governments provide administration services, employing clerks, assessors, business administrators and others who manage and supervise the 12 million people employed by local governments, nation-wide. (Far more people are employed by local governments than by all 50 states and the federal government, combined.)

It’s important to note that property taxes are not the sole source of revenues to local government. In New York State, approximately half of the revenues used by public schools, towns and villages come from local property taxes. A much larger share of revenues for libraries and fire districts also comes from local property taxes. State aid makes up almost a third of the annual revenue used by local governments. Sales taxes, federal aid, fees, fines and other smaller revenue sources make up the remainder of local government expenses.

Supreme Court Justice Oliver Wendell Holmes, Jr. wisely reminded us that “taxes are the price of a civilized society.” In the next article of this series I’ll discuss more about our property taxes (the price we pay for our local civilization) and explain how and why they’ve grown so much in recent decades.