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What you need to know for 11/21/2017

On vets' tax exemption, districts caught between a rock and tax break

On vets' tax exemption, districts caught between a rock and tax break

“Boards would be in the difficult position of either denying the benefit to a deserving group or gra
On vets' tax exemption, districts caught between a rock and tax break
Niskayuna resident and veteran Gary Horton recites the Pledge of Allegiance during the middle of his talk to the Niskayuna School Board on the Alternative Veterans Exemption last month.
Photographer: Marc Schultz

It’s hard to say no to veterans. And it’s hard to raise taxes on people — even if it’s to help veterans.

But that’s the position that many school boards in the region have found themselves in as more and more veterans call for a school district tax exemption that, in some cases, would save them hundreds of dollars on their annual tax bills.

The situation plays out similarly in districts across the region and, at times, gets heated as veterans fill up public comments sheets and express dismay that the exemption isn’t already in place, and school board members balance supporting veterans on the one hand and raising taxes for the rest of the community on the other.

Even when board members eventually bow to pressure from veterans and approve the break, they often point to the fundamental difficulty of voting on an exemption for veterans that has to be paid for by other taxpayers.

“I believe this law is flawed. It’s putting school board members in a position they shouldn’t be in; this shouldn’t be our decision,” Niskayuna school board member David Apkarian said when he and all but one other member voted in February to approve the exemption.

Each year, school boards set a tax levy for the districts — sometimes increasing taxes — but those taxes are distributed evenly across the district. By forcing board members to choose how much certain taxpayers will or will not pay into that levy, the veterans’ tax exemption law introduces a new element into their job, board members argue.

“I ran for the school board to educate kids not to decide whether veterans deserve a tax break,” Apkarian added.

But veterans see the exemption as a small benefit they are more than deserving of — it only applies to wartime, combat and disabled veterans — and one that would help many veterans struggling to get by.

“Have you seen the situation that some of these disabled veterans are in?” said Don Collins, who said he first asked the Duanesburg school board to consider the exemption in 2014 and has been fighting them off-and-on to adopt it ever since. “There are guys that have lost their legs or lost a leg. . . . Don’t you think that’s worth more than $400 a year on their schools taxes? It’s insulting, it’s just insulting.”

Duanesburg has had one of the most contentious discussions over the veterans exemption of any local district. At a recent meeting — when the board voted 5 to 2 to hold a public advisory about how to move forward — veterans in the crowd implored the board to stop “kicking the can” and at one point accused the superintendent of lying about how the exemption would impact taxes. (School officials there said last week they had miscalculated how the tax shift from the tax break would impact other property owners.)

“I’m ready for it to be over with when they decide they can do something for the veterans,” said Art Crandall, a veteran in Duanesburg. “Let’s get the board not just saying we regard vets in good favor, actually do something for the vets.”

Duanesburg school officials, however, emphasize that the school board has to take into consideration how the exemption — which doesn’t lower the district’s overall tax levy so has to be paid for by the rest of the district’s taxpayers — effects other people in the community. And, in exasperation, they question what fighting over tax breaks for veterans has to do with education.

“The amount of hours we have spent on this, which has nothing to do with children, is very frustrating,” Duanesburg Superintendent Christine Crowley said this week. “We have struggled with it, and I suspect there are other districts that are struggling with it.”

Crowley had even more pointed words for Gov. Andrew Cuomo at the board meeting when the exemption was discussed earlier this month.

“I have complete and utter resentment for our governor. It was a sound bite for when he was running for re-election and then it was forced on school districts,” Crowley said. “It sets up polarization of communities… and certainly does not unite.”

The Shenendehowa and Burnt Hills-Ballston Lake school districts both started discussing the exemption at recent school board meetings. Shenendehowa will discuss it more at a board meeting later this week, and Burnt Hills officials put out a survey to solicit public input about how to proceed.

“The way the bill is designed requires we show respect for all of our community,” Burnt Hills-Ballston Lake school board President Peter Sawyer said at an informational meeting on the exemption last month. “We want community input; we want the community to be informed.”

Ultimately, it’s up to school boards to approve whether to extend the break to veterans, which has to be in place by March to take hold for the following year’s taxes.

Not a new problem

The New York School Boards Association raised similar concerns to those echoed across school board meeting when the legislation was considered and passed into law in 2013. In a letter urging Gov. Andrew Cuomo to veto the legislation at the time, the association argued that school boards would come under “significant pressure” to pass the break.

“Boards would be in the difficult position of either denying the benefit to a deserving group or granting the benefit which would require shifting an additional tax burden onto others in the community,” the group wrote at the time.

Since the exemption law went into place, more and more districts have approved it — roughly 40 percent of over 600 districts statewide had approved the exemption, according to a survey the association conducted last school year.

The group has pushed for legislation that would require the state reimburse districts for the amount of money exempt under the tax break, as well as cap income for veterans eligible to benefit from the exemption at $500,000.

“I’m sure it would not be an inexpensive proposition but that point shows the difficulty that districts are in right now,” said Brian Fessler, a member of the school boards association government-relations team. “Instead of the state, that dollar figure is spread across everyone else in the district without regard to ability to pay.”

But the school boards association isn’t naïve to the political benefits flowing from the legislation already in place.

“It’s win-win for them now,” Fessler said of lawmakers. “They get to approve the authorization of these tax exemptions and there can be a press release talking about support for veterans, . . . but right now none of the financial burden is on the state.”

Bipartisan support . . . in principle

For their part, local lawmakers concede that the state should pick up the tab for the tax breaks, benefiting both veterans and school districts as more districts would likely move to adopt the exemption.

Democratic Assemblymen Phil Steck, Colonie, and Angelo Sanatabarbara, Rotterdam, and Republican lawmakers George Amedore, Rotterdam, and Jim Tedisco, Glenville, all support legislation that would do just that. But last session the bill that would have done that didn’t pass, and funding for it wasn’t included in a final state budget.

How do lawmakers pay for it? Santabarbara said it’s a matter of “prioritizing” education above other expenditures, which he did not specify. He also proposed replacing the school district veterans’ exemption with a statewide property tax break for veterans — similar to the STAR exemptions currently in place.

Tedisco and Amedore each said there is plenty of room in the state’s multi-billion dollar budget to pick up the cost of the exemption. Amedore said he doesn’t want to see the tax exemption result in an “increase on already existing, overburdened” taxes on property owners.

“If you are going to put [school districts] in that bind, I think that is a burden,” Tedisco said. “I want to help them with that discrepancy and the cost to give the tax exemption to the veterans — they deserve it.”

But Steck said it would take new revenue for the state to pay for the cost of the veterans’ exemption.

“If we are going to have the state take over all of these things, revenue doesn’t come like manna from heaven, it has to be raised,” Steck said, suggesting a tax increase on the state’s top 1 percent of earners. “You can’t have the state supporting all kinds of programs without raising revenues.”

Until lawmakers can agree on how to pay for the tax break, school board members will be stuck in the middle, facing off with frustrated veterans, while trying to weigh the impact to other taxpayers.

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