The passage of state tax legislation in July will pay off for North Colonie Central School District homeowners.
Under the new legislation, capping shifts in two-tier tax systems at 1 percent, a home assessed at $200,000 could see a $92 reduction on this year's tax bill.
North Colonie will vote to set the tax rate on Monday, Aug. 27.
Backed by state Assemblyman Bob Reilly, D-Colonie, the law temporarily froze the shift in base proportions at 1 percent for one year. The state Office of Real Property has a cap limiting those proportions to shift no more than 5 percent in one year.
In Colonie, the tax burden is split among homeowners and commercial properties.
The new law will help keep taxes to a minimum for homeowners and businesses in towns with two-tier tax systems like Colonie, and many in Long Island.
The two-tier system was originally put in place in 1994 to keep any one of the taxpayer classes from paying an overwhelming share of the levy. But in recent years, the assessed values of Colonie homes have increased at a faster rate than commercial properties, causing a shift in the tax burden to homeowners.
As a result of that, it's not yet been approved, but it looks like the homestead tax rate, instead of 5.5 percent is going to be 2.4 percent, said Tom Rybaltowski, assistant superintendent for business at North Colonie.
As was the case in last year's budget, a shift from commercial properties to residential in the town's two-tier tax base has accounted for a 5.5 percent hike in homestead tax rates for residents. In recent years, while homeowners carry a greater share of the tax burden, commercial entities have seen a decrease.
In May, North Colonie residents passed a $79.5 million budget for the 2007-2008 school year, a 2.4 percent increase over the current year's spending plan. Under it, a home assessed at $200,000 will see an increase of $127.40 in taxes. More than half of that increase was attributed to the tax shift.