If you are ever asked where the highest property taxes in New York are paid, be careful… It’s a trick question. Although the logical answer points to Manhattan, Long Island, or even Westchester, it is a fiscal paradox that affects thousands of homeowners. According to the 2025 report from the New York State Comptroller’s Office (NYS Comptroller’s Office), the heaviest tax burden falls on a small county in the rural central region: Cortland County.

Cortland County

Americans have never talked about Cortland County, but it is a hard-working region of New York located south of Syracuse. Its local economy is historically based on manufacturing and agriculture. However, it is the total value tax rate that puts it in a bind. For fiscal year 2025, Cortland’s rate was $10.72 per $1,000 of total property value. This figure alone placed it as the number one highest tax rate in New York State (not including New York City counties, obviously). Behind it was Allegany County, with a very close rate of $10.12.

The Full-Value Tax Rate is the most important and fairest metric for comparing the true tax burden between different counties. This rate is based on the actual market value of the property, allowing for a fair comparison of each resident’s tax burden. This is what creates the following paradox: low value, but high rates.

The Tax Paradox

The property tax formula is, in principle, quite simple: the fixed cost of operating the government is divided by the total value of property in the county, which gives the tax rate. However, rural counties like Cortland face a structural challenge; their homes and properties have a fairly low total property value, but the county government has an unavoidable fixed operating cost. This levy needs to cover essential services that are required by law, regardless of property values. This creates a fixed cost to fund police, roads, and social services, forcing the county to apply a disproportionately high tax rate.

This means that Cortland County has the highest taxes.

These are taxes in proportion to the value of the homes, not the total tax paid. The problem is not that the county spends extravagantly, but that the low wealth of local property forces it to tax aggressively.

How much does local government cost?

To understand Levi, we first need to know what the county’s fixed operating costs are. As much as we might want to, we live in a society, and these services cannot be reduced until they disappear. The largest component of non-local costs is social services. These expenses include assistance programs and Medicaid, which are often higher in areas with lower incomes. Another significant cost is the maintenance of local infrastructure. All bridges, roads, and water and sewer systems require maintenance.

Then there are retroactive charges; these are costs for services that the county provides to the municipality but then adds to that municipality’s tax bill. An example would be election expenses or the costs of certain Sheriff’s services. All of these expenses are added to the Levy, which adds to the total amount that taxpayers have to pay.

Beyond New York

Cortland’s situation is not an anomaly, but just one example of the “Low Value, High Cost” phenomenon seen across the United States. This problem is common in regions with stagnant or declining economies. Most counties in the same situation as Cortland are those that have lost their industrial base, but have not been replaced by a high-value economy. This is the case for counties in the Midwest such as DeKalb or Peoria in Illinois. Other areas, such as some counties in Ohio (e.g., Summit and Fairfield), are also in the same situation.