Most New York State homeowners are familiar with STAR, the School Tax Relief
program launched in 1998-99. Originally intended to assist senior citizen (age 65 and
over) homeowners, STAR was quickly increased and expanded to include residential
properties of other school district taxpayers.
Qualified homeowners (who must apply to participate in STAR through their local
assessor) receive a partial property tax exemption under the program, which reduces
what they would otherwise owe on their property tax bills that year. Local school
districts are, in turn, reimbursed by the state for the uncollected property tax revenues.
Since its inception, STAR has shifted more than $3.2 billion from the local tax burden
to the state.
Most STAR recipients save several hundred dollars on their property taxes each
year. Several factors contribute to the calculation of the actual amount, including
the assessed value of the home and its location (some counties are adjusted upwards
to account for higher home values and higher taxes), the level of assessment in the
community, and an annual adjustment based on the rate of inflation (for Enhanced
Prior year savings under STAR are now also a factor. In 2011-12, the state enacted a
two percent cap on the increase in maximum STAR savings over the previous year.
Although STAR exemptions apply to school property taxes, school districts have no
influence over the exemptions or tax savings. STAR exemption amounts are calculated
by the Office of Real Property Tax Services (ORPTS), a division of the state Department
of Taxation and Finance.
Because assessment data and equalization rates are not usually available during the
spring school budget season, school districts frequently resist quoting future tax rates
related to their proposed spending plans. Accurate tax information becomes available
later in the summer before tax bills are sent to residents.
The school property tax bill will clearly state the STAR exemption amount and tax
savings. If taxes are held in an escrow account, homeowners should receive a receipt
that includes STAR information.
The Law Office of William J. Reinhardt, Jr. has assisted many of his clients with questions and application procedures on STAR as they have become homeowners to assure that they take full advantage of this program.