Archive for March 8th, 2012

March 8, 2012

Effects of 2% tax cap on New York public school budgets

by Grace

In the wake of New York’s new 2% property tax cap, Lower Hudson Valley taxpayers are learning that “not a single district is likely to seek a cap override when budget votes are held May 15”.  According to school officials, it’s simply too risky to propose a budget that would exceed 2% growth.

Under the new system, districts must keep the increase in their tax levy — the amount of money raised in taxes — below their cap. The “starting” cap for each district is 2 percent, but several exemptions will give most districts slightly higher caps in the 2 percent to 3 percent range.

A new twist is that if a district has two budget proposals rejected by voters, it will have to freeze its property tax levy at this year’s level — requiring deep spending cuts. So if a district goes for an override and does not get a 60 percent super-majority, it will have only one chance to pass a budget under the cap….

“If you try for a super-majority and lose, you only get one more chance and could wind up with a zero (percent tax levy increase),” said Anne Byrne, Nanuet’s school board president.

Taxpayers have no appetite for bigger increases.

It was clear from superintendents’ responses that given the economic climate — and with all the attention heaped on Cuomo’s much-publicized cap — there is a consensus that trying to leapfrog the cap in its first year could be a bad move.

“I have met with our Citizens’ Budget Advisory Committee, held Superintendent’s Coffee Hours, and held a Community Budget Forum, in addition to many internal meetings with administrators, staff and the Board of Education,” Mount Pleasant Superintendent Susan Guiney wrote, “and it appears that while everyone does not wish the school district to endure any reductions in staff or programs, everyone feels that we should respect the tax cap levy and present a budget that complies.”

Is this cap on spending sustainable?

Going forward, many officials said, it will be increasingly difficult to stay under the cap without making staff and program cuts that no one likes.

“It will be next to impossible to continue cutting our budget by these unsustainable amounts,” Putnam Valley Superintendent Barbara Fuchs said.

Schools are working on short-term solutions.

Meanwhile, many districts are pushing legislators to eliminate costly state mandates for transportation, special education and other areas that would produce short-term savings.

But ignoring unsustainable pension cost increases

Meanwhile, they seem to be ignoring the single most costly mandate that is hurting education – skyrocketing pension expenses.  In my local school district, pension costs alone have risen over 50% in the last two years.  Meanwhile, the entire budget has only increased 6%.  Talk about unsustainable.

You can read the entire article below the break.

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