Council Gets Say on Rebate
November 17th, 2008

It was a voila moment for the City Council.

After two and a half hours of grilling the city’s Budget Director Mark Page on the mayor’s plan to fix the city’s financial crisis, which includes withdrawing a $400 property tax rebate, the council’s Finance Committee Chairman David Weprin brought out the “smoking gun.”

After the director refused to say whether the administration could rescind the rebate on its own sans City Council approval, Weprin flailed an “ah ha” document in the air.

It was a preliminary offering statement for the city’s general municipal bonds that went on the market this week. On page three, the document lays out some gap closing measures being considered by the city, including this one: “Rescinding the $400 property tax rebate, which requires the city legislative approval and will result in increased revenues of $256 million in each of the fiscal years 2009 through 2012.”

The administration had previously asserted that it did not need the City Council to approve the withdrawal of the property tax rebate, which many members oppose. The municipal bond document, however, was drafted with the help of the Office of Management and Budget and clearly states that the legislature’s approval is a necessity.

“I would suggest you contact (city Corporation Counsel) Michael Cardoza immediately,” said Weprin.

After a small protest, Page said: “Oh God. Fine.”

If the document stands, it would be a clear victory for the council, which has berated the administration for failing to follow through on its promise to send property owners $400. The rebate has been in place since 2004, and about 600,000 city residents expected it in their mailboxes last month.

Many members who oppose the cancellation of the rebate checks, including Council Speaker Christine Quinn, say residents had been relying on the checks for the holidays.

If the council did vote on it, it is very likely, considering the vocal protest within the body and the speaker’s opposition, that the rebate cancellation would not be approved and residents would get their checks.

In addition to the rebate debate, members also grilled the administration on its decision to cut a police class, slash school spending, reduce funding for libraries and layoffs at the New York City Housing Authority. Some members also criticized a proposal to place a 5 cent tax on plastic bags.

Councilmember Simcha Felder, in an attempt to express his opposition, pulled out several plastic bags that coincidentally were stuffed into his desk. He asked how much they were all worth.

The audience laughed.

Much of the questioning left Page frustrated. The budget director was spotted placing his hands on the side of his face, appearing exhausted, multiple times during the nearly three hour question and answer period.

“I know Mr. Page is always available to come back if we need him,” the finance committee chair said at the end of the hearing.

“Yes,” Page responded somberly.

By on November 17, 2008, 2:48 pm
In category: Albany,Economy,Public Finance | 5 Comments »

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5 Responses to “Council Gets Say on Rebate”

  1. Alex S. Vitale Says:
    November 18th, 2008 at 11:43 am

    Bloombergs $400 Tax Rebate is Misplaced Priority

    By Alex S. Vitale

    It hasnt arrived yet, but my wife and I have already spent our $400 property tax rebate from Mayor Bloomberg. No, we didnt go shopping or pay off credit card debt. Instead, we spent it the way the city should have, we donated it to the Coalition for the Homeless and the Food Bank for New York City.

    Even before the current economic crisis, levels of homelessness and hunger have been on the rise, reaching levels not seen since the Great Depression. Last year 1.3 million New Yorkers relied on a food pantry or soup kitchen. Thirty one percent of those served were children, whose numbers have increased by almost 50% since 2004. Nearly 1 in 4 children in New York are living in poverty. These food pantries and kitchens are underfunded, often turn people away as supplies run out, and rely primarily on a declining number of volunteers to run their operations.

    Current food stamp levels, which affect 1.86 million New Yorkers, provide an average of only $1.18 per meal per person and 60% of recipients deplete their monthly allotment within 2 weeks. Despite the low levels of the benefit and outdated eligibility requirements that deny services to many in need, food stamp participation increased by 67,000 in just the second half of 2007, with further increase this year and undoubtedly more to come.

    Despite this increase in need, the citys support for emergency food programs has remained flat for several years and the state has actually reduced funding.

    Last year over 100,000 New Yorkers spent time in a homeless shelter. On any given night there are 35,000 staying in the citys shelter system 27,500 of them families with children. In September a record number of new families entered the system, with close to 1,500 new families a month becoming homeless. Many more live outdoors, in the subway system and in abandoned buildings. The Housing Authority estimates that another 100,000 people in need of housing are living doubled up in public housing units. The vast majority of these people are children and their parents.

    While the mayor has touted his homelessness plan and its efforts at homelessness prevention and rehabilitation of housing units, very few new units affordable by the very poor have been created and little more is in the works. Earlier this year Bloomberg cut $3 million in homelessness support and prevention programs and has announce more cuts for next year. Emergency shelters and rental assistance is certainly necessary, but until large amounts of truly affordable housing is made available, the citys record high homelessness levels are likely to grow.

    Homelessness and hunger are largely the result of a mismatch between declining wages and employment levels on the one hand and increasing housing and food costs on the other. This basic dynamic is further exacerbated by inadequate treatment and support of the mentally ill and substance abusers. Solutions to these problems must take this into account rather than pathologizing the poor.

    The City and the State need to take a variety of drastic actions to address this growing crisis and a $400 property tax rebate is not one of them. They need to raise welfare payment levels, which are worth only about 60% of what they were 30 years ago in real dollars, increase the minimum wage and ensure that it is enforced, invest substantial new dollars in the creation of new affordable housing, provide supportive housing to those with special needs to ensure their ability to remain housed, and increase direct assistance to the citys food pantries and soup kitchens.

    These initiatives will not be cheap, and the federal government should play a major role in seeing them fully implemented. However, local government does have resources that it can call on. Over the last generation billions of dollars have been spent to subsidize luxury and market rate housing, high end commercial real estate, professional sports stadiums, and high finance. These subsidies have undermined the citys finances and encouraged the creation of a mono-economy based on the fortunes of Wall St; an economic gamble that we may be suffering the consequences of for many years to come.

    Alex S. Vitale is assistant professor of Sociology at Brooklyn College and author of City of Disorder; How the Quality of Life Campaign Transformed New York Politics.

  2. Larry Littlefield Says:
    November 18th, 2008 at 12:41 pm

    Might as well impose another 20% property tax hike and double the checks to $800. Perhaps if they were sent to fewer, but more important people, they could be increased to $1,200 or more.

    We’re heading for bankruptcy anyway. And when it arrives everyone will know exactly who to blame for this special deal– Bloomberg.

    Note to Mayor Mike — public services can collapse, taxes can be raised so high the economy collapses, children can be left to die. But special privileges for narrow groups are inviolate. That is the culture you have now joined. Only they special privileges you handed out to seek electoral advantage and the repeal of term limits will outlive your administration. The cost of these decisions will live on.

  3. All Bloomberg All the Time « Politics as Puppetry Says:
    November 20th, 2008 at 5:03 pm

    […] like unilaterally withholding property tax rebate checks (which, he, um, can’t do legally) are the real legacy of the Bloomberg Mayoral reign.  He has vastly centralized power into the […]

  4. Larry Penner Says:
    November 22nd, 2008 at 7:51 am

    This issue clearly illustrates the difference between real leadership and those who engage in political demagoguery. While Mayor Bloomberg offers solutions in facing a $4 billion dollar debt, others are more concerned about positioning themselves for future elective office. NYC Council Finance Committee Chairperson and 2009 candidate for NYC Comptroller David Weprin and Council colleagues support of rebates speaks volumes. Just how does Councilmember Weprin and colleagues propose finding the $256 million to support this refund? His naive belief that both Albany and Washington will come to the rescue makes no sense. They have their own respective budget shortfalls in the tens of billions and hundreds of billions.

    Prior to his election as Councilmember in 2001, the City Finance Department revealed that Weprin owed the City of New York $6,734 in unpaid property taxes going back to 1999. In past years, Councilmember Weprin supported giving out $400 tax rebates even if the homeowner owed the City other debts. He said “But Weprin opposed denying the $400 rebate to property owners who have debts, because “one has nothing to do with each other” (Source: “City’s Quick Check” by Carl Campanile, New York Post — June 4, 2005).

  5. Gotham Gazette - The Wonkster » Blog Archive » The $400 Question Says:
    December 3rd, 2008 at 9:49 am

    […] Mayor Michael Bloomberg has refused to mail out the checks, even though members of administration concede that he needs City Council approval to cancel the […]

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