MALONE - Sit through a budget session or two of the Franklin County Board of Legislators, and you'll hear the phrase, "Our hands are tied," over and over again.
It's a refrain that could likely be heard in every county in the state this fall as local government officials try to find ways to cut costs to keep their tax levies within the newly passed 2 percent property tax cap but constantly run into programs and services that they're required to maintain by state law.
The New York State Association of Counties started a campaign called "9 for 90," meant to highlight the fact that nine state mandates make up 90 percent of county property taxes. Across the state, landowners paid about $4.4 billion total in property taxes in 2010, and $4 billion of that went to pay for state mandates, NYSAC Deputy Director Mark LaVigne said this week during a NYSAC conference in Lake Placid.
Franklin County’s Department of Social Services office in Malone is one of the places where people go to get services mandated by the state.
(Enterprise photo — Jessica Collier)
New York State Association of Counties holds a panel discussion called “Life After a Property Tax Cap,” at the organization’s conference this week in Lake Placid with, from left, NYSAC President William Ryan, Rockland County Executive C. Scott Vanderhoef, Kate Hackett of Standard and Poor’s and Oswego County Manager Philip Church.
(Enterprise photo — Jessica Collier)
Franklin County legislators hack away at their 2012 budget during a budget workshop session Wednesday in Malone.
(Enterprise photo — Jessica Collier)
The Franklin County Court House in Malone
(Enterprise photo — Jessica Collier)
In Franklin County, it's even worse. Those mandates are expected to cost the county about $20 million in 2012, 140 percent of the tentative $14.3 million property tax levy. That levy is roughly 20 percent over this year's, so legislators are hacking away at whatever spending they can to bring it closer to the 2 percent cap.
"One way to think of the county property tax is that it's not really a county property tax," said Franklin County Manager Thomas Leitz in a phone interview this week. "Most of the county property tax just goes to pay for Medicaid, so it's just sent to New York state."
The percentage for 2012 is actually better than in some years past. Former Franklin County manager Jim Feeley said in a presentation last fall that the nine mandates accounted for about 147 percent of the 2009 tax levy. It was down to 137 percent in 2010 and 124 percent in 2011.
Seven of the nine mandates costs as
estimated in the 2012 Franklin County budget
1. Medicaid: $10.25 million
2. Probation: $1.4 million
3. Preschool special education: $1.25 million
4. Indigent legal defense: $900,000
5. Youth detention: $300,000
6. Public assistance: $850,000
7. Pension: $3.4 million
Estimated total cost for all nine: About $20 million or 140 percent of the $14.3 million projected property tax levy
Feeley, who retired this spring, was fond of noting that the county could easily operate on just sales tax and eliminate its property tax completely if the state would get rid of its mandates.
At the NYSAC conference, county officials from across the state vented their frustrations on the topic during a panel discussion called, "Life After a Property Tax Cap."
Oswego County Administrator Philip Church said during a presentation on his county's struggle with mandates that the state is taking the county's right to home rule. He said if counties aren't allowed to raise their property tax more than 2 percent, they should be allowed to raise their sales, bed, mortgage and other taxes without getting them approved by the state Legislature.
"It should be a local decision," Church said. "We have to take the blame for it. State legislators don't have to."
He said county legislatures are going to become advisory boards with no say in any decision before long if things continue on the current path.
"Without mandate relief, eventually we're going to become arms of the state government," Church said.
The following are the nine mandates that NYSAC wants to focus on getting relief from:
In 1966 when Nelson Rockefeller was governor in 1966, the federal government started to offer states a new program called Medicaid, which would help low-income people with the cost of health care. The U.S. would pay 50 percent of the costs, but the state would have to figure out how to make up the other 50 percent.
Most states took the program and agreed to be responsible for their shares of the match, but New York was unique in that it decided to have counties split the 50 percent match with the state. Some states require a local share for some programs, but not across the board like New York does, LaVigne said.
Now Medicaid is the most expensive mandate for New York's counties, taking up large portions of spending from each county's budget.
In Rockland County, the Medicaid program alone costs 110 percent of the tax levy. Rockland County Executive C. Scott Vanderhoef told a sympathetic crowd of county officials from across the state about it as part of the tax cap panel discussion. He said he felt like he is having to dismantle county government, including getting rid of everything the county has built to support its residents. He noted that while Rockland County's Medicaid situation is extreme, all the other counties in the state are dealing with the same problem to a lesser extent.
Franklin County is expected to spend $10.25 million in 2012 on Medicaid, which is about 70 percent of the county's projected tax levy.
Medicaid costs increase by 3 percent each year.
"No one's down on the program, but we're down on this crazy way it's financed," said NYSAC President William Ryan.
2. Public assistance
Safety Net is a program that gives needy families temporary cash assistance, often for people who are homeless, waiting for Social Security money to come through or stuck in similar situations.
Franklin County is expected to spend about $850,000 on the program in 2012.
3. Child welfare
Child welfare is a variety of services spread out through various departments and over various programs, so it's difficult to estimate how much it costs the county, Leitz said.
4. Preschool special education
A 1989 state Education Law set up the preschool special education program, and it required counties to contribute 25 percent by the 1993-94 school year. Now counties are paying 40.5 percent of the program costs and 100 percent of costs over a state-mandated cap on costs for transporting kids who use the program to their service providers.
Franklin County is expected to pay $1.25 million for preschool special education in 2012.
5. Indigent defense
In 1965, the state enacted a law that requires counties to provide legal counsel to people who can't afford it.
Franklin County expects to pay about $900,000 to do so in 2012.
The state and counties used to split the costs of probation 50-50, but LaVigne said that it's now shifted so that the counties pay 86 percent of the costs while the state pays 14 percent, LaVigne said.
Franklin County expects to pay $1.4 million on its probation program in 2012.
7. Early Intervention
The state Early Intervention Program is part of a national program for infants and toddlers with disabilities and their families.
This service is spread out through several county departments over a series of contracts, including services for kids, family support, nutrition and psychological services, making it difficult to estimate the total cost to the county.
"But it's very significant," Leitz said.
8. Youth detention
The county has to pay the state for youth offenders who need to be housed in a state facility.
"They send us a bill, and in some instances, that bill can be up to $500 a day," Leitz said.
The county will pay an estimated $300,000 for youth detention in 2012.
Counties participate in the state pension plan, but they don't have any say over the pension benefit awarded to their own employees.
Leitz expects Franklin County to pay $3.9 million in pension costs in 2012.
These nine are not nearly all of the mandates, just the ones that are the biggest burdens on counties.
"There's a long list of other, smaller mandates in other county departments that add up," Leitz said.
There are so many that Leitz said it's often easier to list what the county does that's not mandated than to list the mandates.
Leitz finds it frustrating that the state is regularly holding back payments to local governments - for most of 2011, the state owed Franklin County between $5 million and $8 million - but the county must pay its Medicaid bill on time regularly or it will be charged interest. Some counties have been pushed into borrowing to pay the bills, in part due to not having revenue promised them by the state, and that means they'll have to pay back the money with interest, costing them more than if they had the state revenue they are supposed to have in the first place.
When Gov. Andrew Cuomo pushed to instill a 2 percent property tax cap as part of his 2011-12 state budget, he also set up a mandate relief team to try to solve the problem.
State Sen. Betty Little, who represents the district in which Franklin County resides, was on a team that was charged with finding mandate relief for local governments when Cuomo was pushing for the 2 percent tax cap. She was unavailable for an interview this week, but her spokesman Dan Mac Entee said the team put together legislation that should add up to $125 million in relief from mandates annually.
Mac Entee acknowledged there's more work to do, and it has to be done as the economy continues to run into rough spots and revenues stagnate. The legislation also requires the state to set up an 11-person mandate relief council - which he said Little is hoping to be named to - that will be charged with finding mandates that can be eliminated.
That's difficult, because there's a reason each mandate was enacted in the first place, Mac Entee said.
"Behind every mandate is a special interest," he said. "That's the political challenge."
Ryan called the work that's been done so far insignificant and said the Legislature left all the big issues on the table when it passed this year's mandate-relief legislation.
"That's outrageous," the NYSAC president said. "It's inexcusable."
Ryan told a crowd at the NYSAC conference that reform can't be pushed back any longer.
"Everything seems to be pushed down the road, and I don't know that we have that much time left," Ryan said. "Maybe the time is now.
"All of the converging pressure has to be on Albany to get them to understand."
At the beginning of this week, a new bill was introduced into the state Legislature that is giving some counties hope. The bill would start shifting the costs of Medicaid back to the state over time, but many are questioning whether the bill will have teeth.
Ryan said people lose sight of the fact that the tax cap would be unnecessary if counties could find some relief from mandates.
"Had they been working on those, this whole tax cap thing wouldn't have even been a topic of discussion," he said.