Mayor Bloomberg, those around town are starting to report, is playing a game with his plan to hike taxes on this city’s property owners. Over the past few weeks, the administration has been floating trial balloons regarding a substantial increase in the city’s property taxes. For a while, the figure being floated for the property tax was a 10% increase. Our Dina Temple-Raston reported that the hike under consideration was 10%. Yesterday, sources in the Bloomberg administration fed to the New York Post and Newsday a list of ranges up to 25%. The mayor’s ruse here appears to be a simple one: He scares the public with an egregious number, and then looks like a hero when he only sticks New Yorkers with a 5% or 10% increase.

The mayor played a similar game with the budget earlier this year. In the spring, City Hall put out a list of so-called contingency cuts, which he supposedly was considering. These included such bluffs as cutting the police force by 1,320 more positions, eliminating a fire company, closing 15 centers for the elderly, reducing garbage collections, eliminating 57 neighborhood youth programs, and cutting 10% of parks employees. He also proposed raising express bus fares. The point of the threats was not to make good on them, but to open negotiations from which any compromise would look reasonable. All that was gained was a budget gap of some $5 billion to $6 billion in the fiscal year starting next July, according to the city’s comptroller, William Thompson.

Now it is being said that the budget gap can’t be closed by cutting alone, despite the bloated size of city government. Momentum for an increase in the property is said to be building by Council Members Vallone and Oddo. Mr. Bloomberg tells reporters that, “Nobody’s remotely sat down and said, this is the percentage of the property tax that should go up.” However, the administration is running the numbers, and has found, using statistical analysis, that a 10% hike will raise about $1 billion. A 20% hike will net about $2 billion. The argument will likely arise that because the property tax has not risen since Mayor Dinkins’ increase in 1992 we can afford after so much time to raise it again.

However, 10%, 5%, or even 1% would be too large an increase. As E.J. McMahon of the Manhattan Institute testified before the City Council earlier this year, New York City already has property taxes 76% above the median for surrounding cities and towns in New York, New Jersey, and Connecticut, places that are hardly tax havens by national standards. And, as our Dina Temple-Raston reports today at page 1, experts predict that a $2 billion increase in the tax could cost up to 100,000 jobs and force workers out of the city. As the city struggles to hold onto its economic base, Joel Kotkin argues in the adjacent columns, it needs not to increase the tax burden. The mayor said yesterday, “Everyone agrees that taxes are a disincentive to economic activity.” There will be no reason to thank Mr. Bloomberg for a modest increase in the property tax when what he needs to be providing is incentives for growth.