Property Tax Burden Has Doubled For Working-Class NYers: Study

NEW YORK — New York City property taxes increased faster than incomes over the last decade, putting a squeeze on many working-class households, a new report found.

The property tax burden — taxes as a percentage of income — nearly doubled from 2005 to 2016 for households earning less than $50,000 a year, while those making $50,000 to $100,000 saw a 59 percent spike, according to the analysis City Comptroller Scott Stringer's office released Thursday.

Moreover, median incomes for those groups rose no more than 4.6 percent in that time period while the median property tax increased almost 100 percent for some, the report says.

Property taxes put a much bigger strain on those low- and middle-class New Yorkers — who comprise roughly half of the city's property tax filers — than their more affluent peers, reflecting the unfairness of the city's property tax system, according to Stringer's office.

"Rising property taxes are becoming a barrier to the middle class and we can’t afford to continue down this path," Stringer, a Democrat, said in a statement. "We need to give New Yorkers a break, and turn a regressive tax system into a fair and progressive one."

Stringer's office examined local income tax records to evaluate how homeowners' property tax burdens changed in the 11-year period.

Households with the lowest incomes spent 12.7 percent of their earnings on property taxes in 2016, up from 6.6 percent in 2005, the report found. Their median income actually decreased 0.8 percent in that period while the median property tax spiked 98 percent.

Those earning $50,000 to $100,000 a year had the second-largest burden at 5.4 percent in 2016, up from 3.4 percent in 2005. Median property taxes for this group also grew at a much faster rate — 67 percent — than median income, which rose just 4.6 percent, the report says.

Things weren't so tough for wealthier households, the report found. Thosee making at least $1 million saw the biggest median income increase — 28.8 percent — while their median property taxes rose 44 percent, the report found. Households earning $250,000 to $500,000 a year face the lowest average property tax burden and saw the lowest increase in property taxes among all the income brackets, the report says.

While city residents generally paid lower property taxes than their neighbors on Long Island and in Westchester County, the median tax bills in the suburbs increased at slower rates across all income brackets, according to the report.

Federal tax reforms approved last year likely won't help the problems, as deductions for state and local taxes such as property taxes are now capped at $10,000.

The city's property tax system has drawn much recent ire. Tax Equity Now, a coalition of advocacy and real estate groups, filed a lawsuit in March claiming the system is unfair and unlawful. Mayor Bill de Blasio and City Council Speaker Corey Johnson appointed a special commission in May to explore reforms to the system in what they called the first such in-depth review since 1993.

Stringer's report recommends expanding existing property tax breaks to provide some relief, particularly for low-income households.

"As the courts and the recently established property tax commission consider the relative fairness of property taxes across property classes, policy makers should also consider how to address the increasing regressivity of property taxes," the report reads.

(Lead image: Photo from Shutterstock)