School budgets in the age of the tax cap

School spending plans passed at a high rate on Long Island and throughout New York state last week, ending the first budget season in which districts were limited by the state’s new tax levy cap.

According to the New York State School Boards Association, 99.2 percent of districts in the state that had tax levy increases at or below the cap passed their budgets, needing only simple majorities to do so.

The success rate wasn’t as high for districts that sought to exceed the tax cap and required supermajorities of 60 percent or more. Only three-fifths of those budgets passed. Locally, Elmont came up short of a supermajority, with about 57 percent approval.

There’s much to be learned from this first experience in the new tax cap era. Traditionally, a vast majority of budgets pass. The statewide rate of approval was 93 percent last year, and the average since 1969 is 84 percent, according to the Schools Boards Association. It seems clear that residents are even more supportive of their school districts when officials make a serious effort to control spending.

The tax cap forced many school administrators and Board of Education members to take a hard look at how money is spent. Along the South Shore, districts implemented a variety of strategies to control costs. In Baldwin, officials realized that they could no longer keep underutilized elementary schools open, and will close two next year. North Bellmore will also shutter a building. The four school districts in Valley Stream collectively negotiated a freeze on teacher salaries next year, avoiding layoffs and cuts in programs.

Several school employee unions in the area — from administrators to teachers to secretaries — have agreed to salary freezes or smaller increases than in years past. The bulk of a school district’s costs are personnel-related, so these deals can save a lot of money and preserve opportunities for students.

We learned that the tax cap law is rather confusing. While it is described as a 2 percent limit on tax levy increases, that figure is only an approximation, subject to a complicated formula that takes into account exemptions for capital spending, pension increases and other items. Each district had its own allowable tax levy increase — some above 2 percent, others below.

In the big, statewide picture, the tax cap is not necessarily equitable. Poorer districts, with fewer resources and programs, are hit harder because there are fewer “extras” to cut. The only way to meet the tax cap for many districts includes extensive layoffs, increased class sizes and the bare minimum in student programs.

The elementary-only districts, in Valley Stream, Franklin Square, Elmont and the Bellmore-Merrick area, are also constrained. Often, the “extras” are found at the secondary level: sports, after-school clubs and drama productions. Elementary districts are more basic, and when cuts need to be made there to meet the tax cap, officials may end up targeting music and art programs.

With the weak economy of the past few years compounded by the implementation of the tax cap this year, most local school officials have been forced to find ways to make their districts run more efficiently. We’ve seen some tough cuts, but for the most part the districts have made it through unscathed. Sooner rather than later, however, they will run out of things to cut that don’t directly impact students. Many districts balanced their budgets by reaching into reserve funds. Most will seriously deplete these funds within a year or two.

Now it’s up to state officials to ensure that school districts can maintain quality education. That means coming through with annual increases in state aid.

There has also been a lot of talk about mandate relief, but little action. Schools continue to be burdened by increases in pension costs. The state recognized that, and allowed an exemption in the tax cap calculation for increases in retirement fund contributions, but all that ultimately did was pass the cost along to residents because districts can collect the extra money in taxes, defying the purpose of a cap.

Overall, it appears that the tax cap has worked well in its first year. But state officials must ensure that it won’t lead to a diminished education system in the long term. If districts are using their allowable tax increases to fund mandates rather than improve their schools and programs, New York is going to be a less desirable place to raise children.