Bill Matejka

CTA President’s Message

SCHOOL TAX CAP HYPE

How Would Commack Schools Be Affected?

            Recently I attended a panel presentation on School Tax Caps sponsored by the League of Women Voters of the Hamptons. The forum was presented by the League to allow the general public to hear and become familiar with the pros and cons of both the school tax cap and “circuit breaker” legislation currently on the agenda in Albany. The panel consisted of NYS Senator Kenneth LaValle; NYS Assemblyman Fred Thiele; Gary Bixhorn, Chief Operating Officer of Eastern Suffolk BOCES; and Richard Iannuzzi, President of the New York State United Teachers.

            A tax bill, based on the recommendations of the NYS Commission on Property Tax Relief, passed the NYS Senate on August 8, 2008. It would cap a school district’s property tax increase in any given year at 4% or 120% of the consumer price index, whichever is less. The Senate cap bill excludes taxes that might be needed to fund capital improvements. It provides that the voters in a school district can override this cap if 55% of the voters approve the budget that is presented with an increase that is above the 4% cap.

            On August 19, 2008, the NYS Assembly passed an alternative bill. This bill seeks to cap taxes using a different approach. It establishes a “circuit breaker” that limits the amount of property taxes a family must pay, based on family income. The current bill sets an income cap of $90,000 at which point ALL property taxes, not just those taxes that fund schools but ALL property taxes, are caped at 5% of income. Any property taxes that are paid beyond this 5% of income cap would qualify for a 25% rebate. At higher income levels, this rebate percentage would be reduced or eliminated. The Assembly legislation also slightly increases NYS income taxes on those with incomes of over one million dollars per year.

            Many of the members of the Commack Teachers Association are also Commack residents. They pay the same property taxes as anyone else. Others are homeowners in neighboring districts. All appreciate that ever increasing property tax bills have become a major problem. WE SUPPORT PROPERTY TAX RELIEF; however, a simplistic solution like a school tax cap will simply “throw out the baby with the bath water.” We need a progressive tax system to fund schools based on a taxpayer’s ability to pay. We believe that the NYS Assembly concept of a circuit breaker, albeit not perfect since in its current form it does not factor in regional differences in cost of living around the state, at least begins the transition away from the use of local property taxes to fund schools.

            Listed below are a few of our concerns about the school tax cap:

1. The Senate bill would discriminate against middle class districts, like Commack. Wealthier districts will be more likely to pass budgets above the 4% cap with a yes vote over 55%, and poorer districts already receive and are likely to continue to receive, a larger percentage of state aid. This will offset the need to raise the local tax levy above the cap levels.
2. If state aid is not maintained or increased in the future, local taxes will need to be increased to keep up with costs to simply maintain the programs we currently have. A major factor for Commack that has been part of the state aid package over the years has been high tax aid. If this item was suddenly eliminated Commack would instantly lose 2 million dollars. In order to then stay within the limits of the property tax cap, programs would have to be cut.
3. The cap does not take into account large expenditure increases due to mandated special education programs, energy costs, mandatory bus transportation costs and other similar escalating costs that are outside the power of the local school district to control.

            The circuit breaker approach would provide property tax relief to senior citizens and families struggling to keep their homes. Instead of a one size fits all property tax, school taxes would be based on income. Eighteen states currently use a type of circuit breaker.

            In his presentation at the Bridgehampton public forum, NYSUT President Richard Iannuzzi stated that the 4% tax cap could, in many instances, be a tax increase. The average yearly increase in NYS in property taxes to fund schools, as raised by the local tax levy, has averaged 3.3%. If there must be a tax cap then it should be determined locally. That is the basis of local control of our school districts. A solution must be found to make the funding of schools a system that is based on the ability to pay and one that does not punish and scapegoat our fine school districts. After all, are not our schools one of the main reason why families that move to Long Island look to districts like Commack as desirable communities in which to live?

Join us in supporting NYS Assembly Bill # 11838

(with modifications based on regional costs)