Taxing Tuesday: Cap under 0? Now what?

That’s the question at least 12 school districts are asking as they prepare school budgets for the May 15 vote. Especially considering that the tax cap was highly touted as a way to provide relief for taxpayers, yet still provide an opportunity for those districts that want to exceed it to do so.

You’ll find the particulars below, but it comes down to this: The Northern Adirondack Central School District may submit a budget to voters that has a 0 percent tax increase but, because it exceeds the negative tax cap figure, 60 percent of voters must say “yes” to that budget. If not, the district will get one more chance to get a budget approved (and there’re a couple of options there) but, in the worst case scenario, 40.1 percent of the voters in that district get more say than 59.9 percent.

Here are the particulars. My hometown newspaper had an interesting story last week about how the Schenectady city school district’s tax cap is a -.2 percent. Sorry I can’t provide a link as the Daily Gazette’s online content requires a paid subscription.

You might recall we wrote about the formula to determine the tax cap a few weeks ago.

And we spelled out how the combination of the tax cap and cuts to state aid have the deck stacked against schools.

I thought it was bad enough to have to budget for health insurance increases and fuel expense increases and any contracts that were negotiated before this tax cap and stay within 2 percent. But, in Schenectady, school administrators don’t even get that chance. Thanks to a payment in lieu of taxes (PILOT) from General Electric (an agreement that means GE pays less than it would if it paid the total amount of its property tax bill), Schenectady’s tax cap is a .19 percent decrease.

It’s not just Schenectady. Here, in alphabetical order, are the districts and their exact negative tax caps:

  • Amsterdam, -1.95
  • Ballston Spa, -2.87
  • Canisteo-Greenwood, -0.48
  • Jasper-Troupsburg, -0.02
  • Kenmore, -3.82
  • Moravia, -2.92
  • Newcomb, .-0.48
  • Northern Adirondack, -10.14
  • Oswego, -42.86
  • Schenectady, -0.19
  • Spackenkill, -10.75 and
  • Stillwater, -4.43

In almost all cases, those decreases are due to an increase in these PILOTS. Of course, the number that jumps out is Oswego’s.  The Oswego district had large increases in PILOT payments (around $20 million). So,  if PILOTS go way up, the tax levy has to be reduced in a corresponding manner. Here’s a link to the Palladium-Times reporting on how the budget is being developed in Oswego.

A PILOT is also responsible for the -10.14 allowed increase in the tax levy for the Northern Adirondack schools.

“Some of us are questioning if we’d be better off denying these payments,” said Craig Dumas, president of the North Adirondack TA. “The district is still looking at a number of factors but, so far, it appears our district is going to try to override the tax cap because the -10.14 decrease would cut programs too deeply.”

Early indications are the district will seek a 0 percent increase, which will cut support positions and some high school music offerings. But, by exceeding its property tax cap, that means 60 percent of voters must say yes to approve the budget.

“It boggles my mind that to get a budget approved that does not increase the tax levy we have to get 60 percent of all voters to say yes,” Dumas said. Doesn’t seem fair under the one-man-one-vote rule, does it?

As to Schenectady, its smaller increase is still a larger dollar problem. It’s the double whammy of the tax cap that doesn’t allow an increase and still coping with years of reductions in state aid that has left officials and the board considering closing a middle school, restructuring the pre-K and transportation programs and eliminating some offerings at the high school.

(Last year’s school budget had a 0 percent increase in taxes and the budget was balanced with cuts to administration, teaching and support staff positions.)

NYSUT’s Andy Pallotta keeps making the point to lawmakers that people think their school districts are getting a 4 percent state aid increase. But that will not be the case if $250 million of that number is carved out for competitive grants, as proposed in the Executive Budget (the Legislature, however, has other ideas in its budget bills and directs $200 million of that back to direct aid).  Schenectady only gets a 1.04 percent increase in state aid in the governor’s proposed budget. Three years of state aid cuts has left the district with no room to maneuver. In 2008-09, Schenectady schools received $97.6 million in state aid. The next year, it got less; the next year less again; and, last year, it got just under $92 million.

“Everything that was ever considered extra for our kids is long gone,” said Juliet Benaquisto, president of the Schenectady Federation of Teachers.”Every bit of scheduling magic and rearranging of staffers has been tried and we’re still left with potentially cutting 25 teacher positions and an undetermined number of support staff positions, with still another $2.5 million worth of cuts to make before the budget is balanced.”

Balanced under a negative tax cap, which she predicted, “will slowly destroy public education!”

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4 Comments

  1. tmg March 13, 2012 at 1:48 pm #

    Is there any way to stop it or change it?????

    • Betsy Sandberg March 14, 2012 at 8:27 am #

      For this year no. Laws can always be amended (on ways to further disadvantage school though, keep in mind) or even repealed. ONe quick note: This law is scheduled to sunset (which means expire unless it is renewed) on June 15, 2016.

  2. Michael Wesolowski March 19, 2012 at 1:59 pm #

    I am a parent trying to understanding the impact the tax levy will have on my school, can anyone help? My school board cannot articulate the matter.

    • Betsy Sandberg March 19, 2012 at 2:12 pm #

      Michael,
      Give me a call at 800-342-9810, ext. 6283 and I’ll try to help.
      I will need to know your district and then I can give you a few specifics.

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