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'Complicated calculation': Some school districts exceed state's 2 percent tax cap

Posted by keshiaclukey on May 22, 2013 at 11:05 AM


'Complicated calculation': Some school districts exceed state's 2 percent tax cap


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Voters heading to the polls today to decide the fate of school districts might be surprised to see tax levies perceivably higher than the state’s 2 percent property tax cap.

But superintendents say don’t judge a budget at first glance.

“The name is actually a misnomer,” said Robert Miller, Herkimer Central School District superintendent.

The district is proposing an approximately $20.7 million budget, with a 4 percent increase in the tax levy.

“It’s a much more complicated calculation than just 2 percent,” Miller said.

According to the eight-page formula, the district is able to increase taxes 4.37 percent, including exclusions, if approved by a majority of district voters.

“We’re actually under our limit,” Miller said.

This is the second year districts and municipalities have had to work within the state mandated cap. All 29 school districts in the Mohawk Valley are proposing tax levy increases below or meeting the cap — though 18 appear to be higher.

Of the 669 school districts statewide voting today, 27 school districts are proposing budgets that actually exceed the cap compared to 48 last year, according to the New York State School Boards Association. Districts over the tax-levy limit must have a supermajority vote, 60 percent approval.

Levies and spending have gone up modestly compared to last year, thanks in part to a 4.7 percent increase in state aid, said Michael Borges, executive director of the New York State Association of School Business Officials.

Despite the increase, districts still face significant rising costs, unfunded mandates and insufficient aid.

The cap is on the levy, not the rate, so it restricts how much a district can raise, said David Albert, director of communications and research for the New York State School Boards Association.

Exclusions help districts stay within that levy. They include capital project expenses, legal expenditures and, as in the case with Herkimer, rising pension costs.

Levies make up 40 to 60 percent of a district’s budget, Borges said.

“It’s very important and they couldn’t exist with out them,” he said.

The main issue districts face is the nearly 37 percent rise in the Teachers’ Retirement System employer contribution rates from an 11.84 percent contribution rate in 2012-13 to 16.25 percent in 2013-14.

Several area districts also have payment-in-lieu-of-taxes agreements expiring.

For example, the Rome City School District’s agreement with Family Dollar will end this school year, so the company will be paying school taxes on its property’s full value.


The change will increase the tax levy by 4.65 percent, but will not affect resident tax bills, said district Superintendent Jeffrey Simons.

The district is proposing a nearly $105 million budget with a tax-levy increase of 6.57 percent — meaning an 1.75 percent increase for individual taxpayers

If budgets are voted down today, districts will have a second chance to have them approved by voters at a June 18 revote. Otherwise, they will revert to contingency budgets and receive the same tax levy funds as were approved last year.

Officials in the Clinton Central School District have been working to educate the public about its approximately $24.2 million budget and the property tax cap in the hopes that it’ll be approved.

“We tried to balance the needs of the students and be faithful to the mission, with the understanding that we can only sustain so high an increase (in expenses),” said district Superintendent Matthew Reilly.

The district is proposing a 2.95 percent tax-levy increase, though it is allotted 4.24 percent according to the state formula. The additional funds are due mainly to increased pension costs and capital projects, Reilly said.

At the same time, the district tried to keep the taxpayers in mind.

 “Districts are being conscientious, but it does take work,” Reilly said. 


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