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Tax cap proposal could be costly
7/16/2008 |
By Patsy Nicosia |
Even with New York State legislators on summer “break,” the discussion over a proposed cap on school property taxes is continuing.
Legislators failed to act on Governor David Paterson’s plan to cap school tax increases at four percent, but the Governor has promised to put what he admitted is a “blunt instrument” back on the table in the fall.
That scares local school administrators like Pat Green, superintendent at Sharon Springs Central School.
“The property tax issue is huge and needs to be dealt with,” Mr. Green said. “But four percent means a lot to a district like SSCS.
“From the figures we’ve seen, we’d be losing $166,000 every year or $567,555 over the past four years. For us, that’s three to four teachers—every year. We couldn’t survive.”
Mr. Green said it also doesn’t make much sense to limit a district’s ability to tax when there’s no way to put a lid on most expenses and state aid is always unpredictable.
Similar efforts in states like California and Massachusetts have led to larger class sizes, the elimination of transportation, and even consolidations, he said, all things SSCS taxpayers have argued against, he said.
“Property taxes have been a problem for a long time,” Mr. Green added. “There’s no easy or overnight solution. Something like this would mean a radical change for all schools.
Or for most of them.
The Governor’s proposed legislation wouldn’t apply to districts in New York City, Buffalo, Rochester, Syracuse, or Yonkers.
“All of us understand that the cap is a blunt instrument,” Governor Paterson said, “but it is needed to force hard choices and to address the fact that New York’s tax burden is the highest in the nation.”
Like Mr. Green, Howard Anderson, business manager for the Cobleskill-Richmondville Central School District, is concerned about both the rising expenses everyone is facing and the potential impact on a cap on taxes.
“Had it been put in place a few years ago, the district would have had to have cut several million dollars from its budget and it wouldn’t be the same district it is today,” Mr. Anderson said.
Three or four years of a four percent cap would have meant close to $7 or $8 million, he said, which would have brought with them serious program cuts—among other things.
Chris Spies is president of the Schoharie Central School Board of Education.
He pointed out any tax cap would likely require districts to renegotiate their teachers’ contracts.
SCS’s teachers’ contact limits class size “but there are only so many teachers we could lay off [because of the tax cap] without breaking that,” Mr. Spies said.
“It’s a really complicated topic. It’s hard to argue with the intent, but the devil is in the details.”
If the Governor’s proposal is eventually adopted, Mr. Spies said he’s confident SCS will be able to work through it without changing the quality of education it provides, but he added that it may be a bigger pill for smaller schools to swallow.
“Caps are very simple, but draconian,” he said. “They’d create a problem for schools to deal with and it would take a while to see how things would sort out. It would have a bearing on negotiations, but it’s not going to make us close our doors.”
According to the Empire Center for New York State Policy—which endorses the tax cap—key provisions of the new limits would include the following:
* Property taxes generated by new construction would be limited from the cap, but there would be no other exclusions or loopholes.
* District proposals to “override” the cap would require the approval of at least 55 percent of the voters.
* District residents could also petition school boards for a referendum to “underride” the cap.
* Capital construction projects would continue to require voter approval and debt service payments on voter-approved debt would not be subject to the cap.
State Senator Jim Seward said he could support a “responsible tax cap plan” with heavy emphasis on the word “responsible.”
“Things are at the breaking point, but the Governor’s proposal is not a panacea,” Senator Seward said. “To make it work in our area, the state would have to ‘backfill’ [with aid] to rural schools.
“We’d also have to look at mandate relief. Things like pension costs, health insurance, energy—these are out of the control of our local schools.”
Senator Seward said he likes the idea of a “circuit breaker” provision that would cap an individual’s property taxes at six percent of their income.
Something like that would really help the lower- and middle-income residents of our area,” he said. “There are plenty of proposals out there. I could support something that’s responsible—and workable.”