Ever since the reapportionment of the State Senate circa 1970, which gave Downstate interests control of state government, most places in Upstate NY have seen their populations, job numbers, and economic well-being decline. Upstate NY counties have long dominated the top 25 slots of the most-taxed counties in the nation when property tax is calculated as a percentage of property value. Yet interestingly, on that same list, Kings (a/k/a Brooklyn) and New York (a/k/a Manhattan) Counties in New York City ranked in the mid-1500's (no that is not a typo) -- among the lowest in the nation.
The cost of Medicaid, a health insurance program for people of lower income or means, is shared by the Federal Government and the States. The States manage the programs and determine the levels of benefits. New York State, unlike most other states, passes a portion of the cost of its share down to the Counties (an "unfunded mandate") who pass it along to their tax payers usually via property taxes. Medicaid has driven much of the high taxation Upstate.
Now, as part of the GOP plan to reform health insurance, it is proposed that NYS will be prevented from passing its costs on to localities outside of New York City.
In Oneida County, for example, the county's Medicaid costs account for more than 80 percent of the county's total tax levy. In Oswego County, Medicaid accounts for more than 44 percent of the tax levy.In another article:
Medicaid is Onondaga County's most significant financial burden, accounting for 70 percent of the property tax levy -- one of the highest rates in the state.While NYS has been generous in handing out Medicaid benefits, the method of financing these benefits has created harm to upstate localities but not to New York City (where real estate values are very high and there are many absentee foreign landowners.) Since the NYC metro area controls the state legislature, it is unlikely the Medicaid burden will be lifted from Upstate without pressure from the Federal government.
The GOP healthcare reform, if it contains this provision, may be just what is needed to lift the Medicaid burden from local government and bring Upstate property taxes closer in line to those in other parts of the country with which we compete.
If successful, Reps. Collins, Tenney, and other supporters of this provision would have contributed more to make Oneida County and Upstate NY more competitive with other parts of the country than perhaps all the local and state economic development efforts of the last 20 years combined.
Of course, there is much more to consider about healthcare reform than just this provision. Reform will require a careful weighing of the issues. As usual, partisanship will get in the way, and many will be tempted to dismiss the possibility of any reform. Per the OD:
Rep. Louise Slaughter, D-N.Y., called the GOP plan "a political sleight of hand" that seeks to buy GOP votes — and pay for tax cuts for the wealthy — at the expense of New Yorkers.The Medicaid provision, however, would not be "tax cuts for the wealthy" because Upstate is poor compared to Downstate, and all this provision does is prevent the State from passing its share on to Upstate Counties. At a potential $244 per Oneida County resident, (see Empire Center) savings could just be enough to to make Oneida County attractive to job creators. Again, Medicaid and how it is funded is just one issue among many, but since this area has already sacrificed its economy at least in part for New York's generous Medicaid benefits, the issue of Medicaid funding vs jobs should not be dismissed as "political sleight of hand."
The Big Question is whether the County Executive, Sen. Griffo, and Assemblymember Brindisi will get on board to support this Medicaid provision, since the state is unlikely to do it on its own. If so they will finally do something meaningful for area economic development, if only to make it an issue to be put on the State's agenda.