ELMIRA – At a news conference today, Chemung County Executive Tom Santulli offered up to Governor Paterson a common sense solution to lowering property taxes in New York State.  Following Governor Paterson’s April 27th Executive Order No. 17, which establishes measure to evaluate costs of mandates on local governments and his May 4th proposal calling for a cap on State spending, Santulli is challenging Paterson to take action on his proposals by offering a common sense plan which could accomplish both initiatives.

“Administration after administration has condemned the escalating costs in New York State yet year after year continue to increase the tax burden on property owners,” said Santulli.  “I find it confusing that after approving a 2009-10 State budget which increases spending by more that 9%, less than a month later the Governor called for a cap on State spending. This same budget continues to pass along unfunded mandates to counties.  Our Sheriff, recently received a letter from the State Division of Parole notifying him that the subsidy to provide reimbursement for mandated housing of State parole violators in local jails has been eliminated thus shifting the burden, once again, to the local tax payer.”

The most significant unfunded mandate in County budgets continues to be the local share of Medicaid. Santulli along with the New York State Association of Counties (NYSAC) and County officials from across the State fought to achieve a cap on Medicaid spending, but the program continues to cost tax payers in Chemung County over $18 Million or 74% of the total property tax levy. The Federal Government is providing some relief to counties through FMAP (Federal Medicaid Assistance Percentages) funds which will offset budget deficits in the next two years but that is only a temporary solution.

Santulli is proposing New York State take over the local share of Medicaid once FMAP expires. Santulli stated the State, with the help of the NYSAC, can develop over the next 18 months a plan to reform and reduce the Medicaid spending in NYS equal to the current local share cost of this program.  Santulli further pledges to pass along these savings to property tax payers by cutting the property tax rate. By eliminating the local share of Medicaid, Chemung County could reduce the property tax rate from $6.98 to $2.35 per thousand of assessed value providing much needed relief to our overburden homeowners and businesses.

“For this program to be effective we can not just place the burden back onto the State. But in the State’s $45 Billion Medicaid budget, I believe it is possible, to reduce spending by the roughly 16% which constitutes the local share portion,” said Santulli. “In 2005, Chemung County presented the State with a Medicaid Demonstration Project which was estimated to save 15-20% in Medicaid costs.  We are currently working on the final details of a Medicaid Community Health Center in Chemung County which is projected to see similar savings. I am confident that the State, with the help of NYSAC, can find additional ways to reform the Medicaid program while increasing the quality of care for our Medicaid recipients and experience overall cost reduction in the program.”

Santulli pointed out that New York State’s Medicaid budget is the highest in the nation, more than the entire budgets of more than 40 States and comprises 13.8% of the total Medicaid spending of all 50 states.

New York’s Medicaid Budget is:
• 20% higher than California’s $36 Billion Medicaid budget although California’s population is almost 50% higher than NY.
• More than double Texas’ Medicaid budget of $21 Billion although Texas’ population is 20% higher than NY.
• More than three times the $14 Billion Medicaid budget of the State of Florida which has a similar population to NY.

Of New York State’s $45.45 Billion in Medicaid spending, the local share to counties is 7.4 Billion or 16.3%.

If New York State were able to develop a plan to eliminate the local share from the Medicaid budget, NY would still have the highest Medicaid spending in the nation at just over $38 Billion. This $38 Billion is higher than the entire General Fund Budget of Pennsylvania.

Santulli will be asking the Chemung County Legislature to pass a resolution stating that, should the Governor accept this proposal, Chemung County pledges to pass this savings along to County taxpayers and reduce the property tax levy and tax rate.  He hopes other Counties will join him in encouraging this cooperation with the State and to assist Governor Paterson in following through with his pledge to provide real property tax relief to New Yorkers.