By Andrew Hackmack
The New York State Commission on Property Tax Relief is calling for each school district to cap its annual tax levy increase at 4 percent.
The tax levy is the major source of revenue for most school districts in New York state. Gov. Paterson has proposed legislation to implement this cap of 4 percent or 120 percent of the Consumer Price Index - whichever is less.
If a district wants to exceed that cap, the commission suggested a budget should win voter approval by more than just a simple majority. The governor accepted that recommendation, too. His proposal says that if districts want to exceed the cap, 55 percent of voters must approve the budget, and 60 percent if a district gets a state aid boost of at least 5 percent.
"New York is the highest taxed state in the nation," Paterson said, "and we can no longer afford to ignore the reality that property taxes are driving people and businesses out."
There is one significant difference between the commission's report and the governor's proposal. Suozzi's commission recommended that if a school district sets its budget under the four percent cap, voter approval would not be required. The governor did not accept this idea, wanting to preserve the right of homeowners to vote for their school district budget every year.
State Sen. Dean Skelos (R-Rockville Centre) agreed. "A school budget involves more than the tax rate," he said. "Parents have a right to vote on how school districts are spending their money."
If a school budget is defeated twice, a district automatically must adopt a contingency spending plan. In that situation, a district is capped in how much it can raise its budget -- usually between 3 and 4 percent. However, that cap is on spending and not on the tax levy.
County Executive Suozzi rejected the notion that contingency spending already acts as a tax cap. "A lot of times we vote against the school budget and the contingency budget is often higher," he said. "It's become a sham process and often very few people vote."
Suozzi did acknowledge the pressure school districts face as a result of unfunded state and federal mandates. His commission recommended several steps to provide mandate relief, including a provision that would prohibit new education requirements without a thorough review of the financial impact on local governments. "After talking with school districts and taxpayers," he said, "I realized they were struggling with unfunded state mandates."
Another recommendation of the commission and the governor is a School Tax Relief Program (STAR) Circuit Breaker. This would provide tax relief to certain individuals based on their income and ability to pay property taxes.
Assemblyman Bob Barra (R-Lynbrook), said he is against the tax cap proposal because homeowners need further relief. He said school districts should have no increases for a few years to let people's salaries "catch-up" to past years of rising taxes.
"We've got to push our schools to be as good with the money," he said, "as they are at educating our kids."
Barra said he acknowledges that school districts will face certain rising costs no matter what and said the state government must do its part every year to bring in a record amount of state aid. He also said for every dollar school districts spend on mandates, the state should match it.
"Clearly taxes are a real problem for people and something needs to be done to get on top of the tax increases," said Rockville Centre school board president Lorrie Brady. "However, the tax cap proposed by the commission and supported by the governor is not the answer. What needs to be done on the state level is a change in the laws and regulations that are in fact driving up the cost of education. One small example which would have an enormous impact is a change in the pension system and another area that would help enormously would be the elimination of the Triborough Amendment, which mandates automatic step and lane increases for teachers even when a contract expires. In any event, a school district only controls budget increases, not increases in the tax levy. So a tax cap that isn't linked to an increase or decrease in state aid is going to have a widely-varying effect on different school districts. If it comes to pass, people will be horrified at what the actual effect would be on their individual schools."
Dr. William Johnson, Rockville Centre's school superintendent has also been sharply critical of mandated tax caps. At a February forum on school finance, Johnson said that under the plan now being considered, local school districts would be unable to raise taxes to fund school programs and that the poorer the district, the more adversely it would be affected by the proposed tax cap in the long run.
Tax caps enacted in California, educators say, have resulted in dramatic reductions in student performance, with wealthier districts raising funds independently to support programs that otherwise would have been cut.
Judy Rattner contributed to this story.Comments about it? AHackmack@liherald.com or (516) 569-4000 ext. 265.
'If it [the proposed tax cap] comes to pass, people will be horrified at what the actual effect would be on their individual schools.'
Lorrie Brady
President, RVC Board of Education
