Authorizes Ulster county to establish a property tax offset by means of a resident income tax surcharge

◆ The sponsor's argument

Why Michelle Hinchey says this is needed

Ulster County relies on property taxes and sales taxes to fund essential county operations, public services, and local needs. While those revenue sources are important under current law, they are also regressive. Sales taxes take a larger relative share of income from working families and lower-income residents than from high-income residents. Property taxes also place significant pressure on homeowners, renters, seniors, and middle-income households, who already face rising housing costs and affordability challenges. In Ulster County, 41% of renters and homeown- ers are considered severely cost-burdened when it comes to housing, spending half their income to keep a roof over their heads. About one- third of working households in Ulster County cannot make ends meet, according to the most recent ALICE data from United Way. Persistent income inequality in Ulster County and in New York State remains a serious public concern, made worse by an inequitable tax burden in which mandated local shares of Medicaid and other social safe- ty net programs must be paid with revenue from property and sales taxes rather than from income taxes. The Ulster County for Fair Taxes Act provides an option for the County to modestly reduce this inequitable burden within the limits of the County government's authority. The bill. does not automatically impose a new tax. Instead, it authorizes Ulster County, through local law, to adopt a resident income tax surcharge on high-income residents. The surcharge is narrowly structured. For individuals, it applies only to state income tax attributable to income above $250,000 for non-joint filers and $500,000 for joint filers. The bill does not authorize a nonresident income tax, does not permit retroactive application, and does not allow Ulster County to create separate local deductions, exemptions, credits, rates, thresholds, or taxpayer remedies. The bill is modeled on the state-administered local income tax surcharge approach used for City of Yonkers. By integrating the surcharge into the Article 22 personal income tax framework, the bill avoids creating a separate county income tax bureaucracy. The Department of Taxation and Finance would administer the surcharge through existing state income tax systems, including filing, withholding, estimated payments, refunds, enforcement, confidentiality, and taxpayer review procedures. The bill also preserves local control. Ulster County must affirmatively adopt a conforming local law before any surcharge can be imposed. Reven- ues collected are remitted to Ulster County and used for county purposes as provided by local law. This gives the County a practical tool to reduce pressure on property taxes and sales taxes while funding essen- tial services in a way that is more closely aligned with residents' ability to pay. By authorizing a progressive, income-based local reven- ue option, this bill advances tax fairness, supports local fiscal stability, and gives Ulster County a responsible pathway to reduce reli- ance on regressive taxation.

This is the sponsor's own case for the bill, quoted from their memorandum. It is not Agora's description of what the bill does.