Escape from New York
They’re packing up and moving away.
Legions of former New Yorkers — and others who plan on joining them — say they’ve grown tired of being squeezed by property tax bills destined to keep rising. They say they’ve lost faith Albany lawmakers can reverse trends making New Yorkers among the most taxed anywhere.
Some even say the state’s skyrocketing real estate taxes left them no choice. They couldn’t afford to stay.
Some tax escapees, who are among the 1.5 million New Yorkers who have left the state since 2000, don’t move far, slipping over the state line to Connecticut, Pennsylvania and Massachusetts. Others flee to low-cost states such as North Carolina, Indiana and Tennessee.
In 2007, Daniel and Nancy Olson went to Oregon — a move that saves them $6,400 a year in property taxes alone.
The Olsons escaped New York’s high property taxes and moved to Oregon.
The annual tax bill on their old home in Voorheesville: $9,200.
Old house in Voorheesville
The bill on a comparable but slightly pricier home in Bend, Ore. $2,800.
Current house in Bend, Oregon.
“I think I know how to spend the money better than it was spent in New York,” said Daniel Olson, 65, who left the state after a long career at GE Global Research in Niskayuna.
For the Olsons and thousands like them, the decision to leave is a simple economic calculation. If moving puts thousands of dollars in your pocket each year, then why not go?
Yet the exodus creates potential for a downward spiral: If those who can afford to leave do so and create property vacancies, the tax burden becomes even more oppressive for the New Yorkers left behind. And that, in turn, gives those people who remain an even greater reason to go.
“The way these property taxes are, I may never be able to quit working,” said Jill Hogan, 53, who saw the property taxes on her small Niskayuna home climb 61 percent last year.
Hogan pays $6,000 annually — and is weighing a move to Iowa or Indiana.
Bill Burdick, 56, also of Niskayuna, pays about the same amount — and is considering New Hampshire, a state without an income tax.
“This thing isn’t going to get better,” Burdick said. “So my plan is just to leave.”
Nearly everyone in New York knows someone who has moved way. And that usually means being regaled by tales of lower property taxes elsewhere.
“You should move, too,” the escapees say. And for many New Yorkers, the temptation grows.
Realtors know well that taxes drive real estate decisions. They’ll tell you tax rates are a major reason that towns in Saratoga County, such as Wilton and Halfmoon, where there is no town tax, are among the fastest growing in the region.
That, in part, is why Jon and Amy Vargo chose Halfmoon when they moved to the Capital Region two years ago from North Carolina. But their feelings about the area started to sour when their taxes came due, and now they’re hoping to someday relocate to Ohio or Indiana.
“I’m frustrated with property taxes,” said Jon Vargo, a 40-year-old training manager for a local manufacturer. “I’m frustrated with pretty much the entire New York state government.”
Lawrence Brown, 53, once shared that frustration. Now he and his wife, Heidi, live in Oklahoma.
“When I got disgusted with the high taxes in New York, I said, ‘To hell with it,’ and came down here,” Brown said.
Brown lives in a small town between Tulsa and Oklahoma, in a two-bedroom home worth about $80,000. He says his annual property tax bill is less than $100, far less than for his former home, a trailer park near Watertown.
“I still have relatives up there,” Brown said. “They’re screaming about property taxes.”
People everywhere complain about property taxes, of course. And it can be difficult to compare property tax bills — and relative tax burdens more generally — in varying
states and regions. Some states, for example, shift the tax burden away from real estate, raising more from a sales or income tax.
But by nearly every measure, New York’s property tax burden is exceptionally high. Study after study has identified oppressive property taxes, in particular, as a threat to the state’s economic health. The 2008 report prepared by former Nassau County Executive Tom Suozzi documented how public schools outside New York City spend more per student than any state in the nation, an estimated $18,768 per student in the 2008-09 school year — an amount 50 percent above the national average. “This results from high personnel costs; the number and complexity of mandates and expense of compliance, especially those that govern special education; and the large number of school districts, many of which are small,” the report said.
The Olsons paid taxes to four entities when they lived in Voorheesville — to Albany County, the school district, the village and the town of New Scotland.
Now, in Oregon, a state with no sales tax, they pay only to the city of Bend. And what the city can levy is controlled by a cap that limits annual increases to three percent.
“It felt good to leave behind the feeling of being powerless or helpless against the vagaries of the political machines that control how much it costs to live in the Capital District,” Olson said.
Tax caps and other measures that would attempt to limit New York’s burden have long been weighed and debated here. But little has been done as New Yorkers pay as much as 40 percent of their income to support schools and local governments, according to numerous Times Union interviews with state officials and lawmakers expert on the issue.
“The taxes were killing us,” said Diana Binkowski, 61, who five years ago moved with her husband from Berne to eastern Tennessee. “The older we got, the harder it got for us.”
Binkowski said a handful of other families from Berne live near her in Tennessee — some of the 1.5 million New Yorkers who relocated since 2000, according to U.S. Census data. (The state overall population has remained stable, thanks to an influx of immigrants from outside the country.)
E.J. McMahon, director of the Empire Center for Policy, a fiscally conservative think tank that last year released a report analyzing New York’s decade of out-migration, said it’s difficult to know precisely why so many residents have left.
Yet anecdotal evidence makes him sure property taxes are a factor. Every New Yorker has heard the grass-is-greener stories of the tax savings available elsewhere, he said, adding that explanation for the lower burdens isn’t complex.
“The major reason for the difference in taxation in other states is that they spend less,” McMahon said. “That’s it. It’s not a mystery.”
The Empire Center’s study found that those leaving New York tended to be wealthier than the state’s newcomers. And there are, of course, well-known examples of wealthy New Yorkers who have moved away for tax reasons — like Tom Golisano, the billionaire from Rochester who departed for Florida.
The vast majority of departing New Yorkers are everyday people trying to save what they can to make their lives easier.
They usually don’t make the decision lightly, because moving away can come at great personal and emotional expense. They leave behind friends, family and cities and towns they know best.
“If you live in a place for 30 years it becomes home,” said Burdick, the Niskayuna resident. “So you have to be highly motivated to leave.”
But the state’s property tax burden is providing the motivation that some New Yorkers need.
“I’ve got four or five years to go until retirement,” said Chris Jones, an industrial mechanic in Feura Bush who recently sold his home to escape property taxes and other costs.
“And then, honestly, I’m out of here,” Jones said.
Chris Churchill can be reached at 454-5442 or firstname.lastname@example.org.
Compare your taxes and those of your neighbors, then join the discussion in our Property Tax Nightmare website.Source: blog.timesunion.com