ALBANY – Property taxpayers would receive direct rebates from New York State if their local governments manage to keep their spending at a certain level, according to details of Governor Pataki’s proposed state budget released yesterday.

The rebate proposal, along with an infusion of state aid to municipalities spread out over two years, is targeted at helping counties and local governments reduce their ballooning costs and keep property taxes in check.

Mr. Pataki, a three-term Republican, will present his state budget proposal tomorrow. He is expected to release long-awaited details on how he plans to rein in the costs of Medicaid, the joint federal-state health care program for the poor. The Pataki administration projects a shortfall of about $4.2 billion in the 2005-06 fiscal year that begins April 1. For years, counties have complained that Medicaid increases have eaten up money for basic services like sheriff’s patrols and libraries. Most counties have resorted to raising property taxes, sales taxes, or both to pay the bills.

Under Mr. Pataki’s proposal, seniors and farmers can get a $100 rebate in 2006 if counties can keep their spending growth below 3.5%.The rebate will grow to $200 in 2007 as long as local governments keep their spending growth below 3%. All other homeowners would be eligible for a $50 rebate in 2008-09; it would increase to $200 during the next four years.

Counties have been cutting spending for the past few years, but the costs that counties cannot control are state mandated ones, mainly Medicaid and pension costs, the president of the New York State County Executive Association, Thomas Suozzi, said yesterday.

“It seems like it would be a good benefit for property taxpayers, but it’s only achievable if the state reduces the growth in mandated state expenses,” said Mr. Suozzi, the Nassau County executive. Meanwhile, cities, towns, and villages across the state will get about $164 million in additional state aid over the next two years if they get their costs under control.

“It’s welcome news,” said Binghamton Mayor Richard Bucci, who is also the president of the New York State Conference of Mayors and Municipal Officials. “It will help stabilize local governments who are at the bottom rung of the ladder.”

In other state budget-related news:

• Mr. Pataki will propose that the state retirement system seek independent review and public comment before changing pension fund methods – a move Mr. Pataki said would save local governments about 4% of their annual payroll costs.


• Mr. Pataki will propose doubling funding over the next two years, to $50 million from $25 million, for a program that allows seniors to retain independence at home while still receiving assistance.


• Mr. Pataki will propose a new program that would invest $10 million to make homes and apartments more accessible to low-income New Yorkers with disabilities.