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School vote today with new tax caps

Tuesday, May 15, 2012
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Today is the first school vote since the state adopted a 2 percent tax cap, and the main thing to understand about the 2 percent cap is that it’s not really a 2 percent cap. There are exceptions to it — for pension increases, for capital expenses, for growth in the tax base, for payments in lieu of taxes — which mean the actual cap for any given district could be almost anything.

It wouldn’t make sense, for example, to limit the rise in taxes to 2 percent if there were a lot of new building going on in a district and new families moving in with more kids to educate. That kind of growth naturally means more money needs to be raised.

The local share of construction projects already approved by the voters is also exempt from the calculation.

And given the lobbying power of teachers’ unions, a portion of increased pension costs is also not counted.

Nine different elements are taken into consideration in calculating the permissible increase in the tax levy, according to the state comptroller, and the 2 percent limit is only one of those.

The actual limit will vary from district to district, but statewide this year, the average limit will be 3 percent, not 2 percent. So we fooled you there.

Locally, the tax cap in the Schenectady school district is actually a slight decrease of 0.2 percent.

In Niskayuna it’s plus 3.29 percent. In Shenendehowa it’s plus 2.88 percent.

Most districts jiggered their budgets to exactly meet the limit.

Cobleskill-Richmondville, for one contrary example, went over its limit of 2.72 percent and is offering voters a budget that requires a 4.54 percent increase.

Ballston Spa and Stillwater found themselves in the novel situation of having to significantly reduce their tax collections if they wanted to comply with their tax caps on account of the big payments in lieu of taxes that they expect to receive from Global Foundries — several million dollars each, depending on rates yet to be set.

Ballston Spa’s cap is not 2 percent higher than last year; it’s 2.87 percent lower. Stillwater’s is 4 percent lower. A very nice effect of this tax-cap law, if I may say so. Previously school districts would have taken a multi-million-dollar windfall and run, or built an Olympic swimming pool, or hired more teachers. Now they are obliged to reduce their taxes proportionately.

Neither school district could bring itself to do it. Never mind reduce its tax levy by 4 percent; Stillwater wants to raise it by 3 percent. Never mind reduce by 2.87 percent; Ballston Spa wants to reduce by just 0.4 percent. In each case, they will need the approval of 60 percent of the voters.

I emphasize that we’re talking about the levy when we talk about a tax cap. It’s not necessarily a limit on the tax rate, or a limit on one’s personal tax bill. It’s a limit on the total amount that a school district is allowed to raise in taxes, which I think is actually an effective way to get taxes under control and allows the least amount of cheating.

The tax rate will vary according to assessments, and so will your personal bill.

For those districts that have stayed within their individual limits, which means 92 percent of all school districts, the usual majority vote will suffice to adopt the budget. For those that want to exceed the limit, a supermajority of 60 percent will be necessary.

If they don’t get it, a second

vote can be held on June 19, and after that, if voters still don’t approve, a so-called contingency budget will go into effect that keeps the levy flat, which is another change from previous years, when the fall-back contingency budget was sometimes higher than the proposed budget, the classic example being Schenectady Superintendent Eric Ely’s contingency budget a few years ago that would have raised taxes 16 percent.

Anyway, I used to say every year that the school budget vote was the most meaningless vote in our wonderful democracy, since it affected almost nothing. Your taxes would go up a few percent if you voted no the same as if you voted yes, since almost all school spending is locked in by law and by contracts, and you don’t get to vote on the law or on the contracts.

Now I can cautiously say that the vote has become a little less meaningless.

RED-FACE DEPT.

Did I say the other day that the nine so-called swing states have 115 electoral votes among them, or 21 percent of the number needed to elect a president?

Yes, I did. And was I right? Not exactly. Their 115 votes are 21 percent of the total number of electoral votes (538); they are 42 percent of the number needed to elect a president (270).

 
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comments

May 15, 2012
9:30 a.m.
+0 votes
Woodrow says...

Carl, thanks for laying this out in a helpful summary of how the cap really affects us.

May 15, 2012
3:47 p.m.
+0 votes
tonijean613 says...

What is the result if the budget is voted down?

May 15, 2012
5:38 p.m.
+0 votes
ronzo says...

People here deserve the high tax rate and these "school taxes". Why? Because they are not willing to do anything about them. People here are not willing to change the "system". This is the only state I've lived in where there are "school taxes". And why are there "school taxes"? To support all the duplication and replication ad naseum because people here "WANT" more than one school district in a county, and all the duplicate costs associated with that "WANT". As long as people want to keep local government the same as it was in 1812 and not make changes like most states did in the mid-20th century, you will be writing about this New York State subject from wherever you are in your next life in the year 2112.

May 16, 2012
10:50 a.m.
+0 votes
jerryrock says...

The Greater Amsterdam School District DID adopt a contingency budget of 16.5% last year after voters turned down the same budget at the polls.

 

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