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Tax cap goes to school

Area districts tangle with tax levy limits enacted by the state government

January 14, 2012
By CHRIS MORRIS - Staff Writer ( , Adirondack Daily Enterprise

For school districts across the state, a new cap on property tax growth means a fundamental shift in the way budgets are prepared.

The state enacted a 2 percent property tax levy cap last year to keep municipal spending in check and to curb New York's reputation as one of the highest taxed states in the U.S.

Locally, many towns and counties were able to comply with the cap, although there were some exceptions: Essex County and the town of Harrietstown, for example. With town and county tax bills sent out this month, the focus now shifts to school districts.

Article Photos

Students in Saranac Lake High School music teacher Keith Kogut’s music theory class have a bit of fun before class gets under way on Wednesday. From left are Julia Murray, Hudson Gray, Kogut, Josh LaDue and Garth Olsen.
(Enterprise photo — Chris Morris)

Superintendents from Tri-Lakes area school districts agree that the toughest part of the upcoming budget season will be convincing taxpayers that the tax cap isn't limited to a 2 percent levy increase.

"It's not 2 percent," said Saranac Lake Central School District Superintendent Gerald Goldman. "Everybody uses that. It's like a bludgeon. It's never been 2 percent."

In fact, 2 percent - or the rate of inflation, whichever is less - is just one of eight figures used to calculate a district's tax levy limit, according to an educational pamphlet issued by the Capital Region Board of Cooperative Educational Services.

The formula also includes exemptions for things like retirement costs, capital projects and court orders.

In other words, some districts could end up with a tax levy limit higher than 2 percent. But some school officials say the amount of media hype surrounding the tax cap has cemented public perception.

"The community is very cognizant of this 2 percent cap that's been laid out there, and that's what they're going to expect," said Randy Richards, superintendent of the Lake Placid Central School District.

For a district to adopt a budget that meets the tax levy limit, a simple majority vote (50 percent or more) is needed. If a budget aims to increase the levy beyond the cap, a 60 percent supermajority at the polls is required.

Keene Central School Superintendent Cynthia Ford-Johnston said her district's Board of Education has discussed the tax cap at nearly every meeting since it was signed into law.

"It's going to be changing the way we do budgeting completely, because we've always budgeted based on what our needs are: This is what we need to maintain the program, and therefore this is what our aid is going to be, and so this is what our levy is going to be," said Ford-Johnston, who also acts as the budget officer and principal of this one-building school district. "Now we're going backwards. We're doing, 'This is what our levy can be. What do we need to cut from what we're spending, and what will our programs look like to meet that?' That's where we are right now."

Richards said student need will still be the top priority in his district's budget. But Richards, like Ford-Johnston, said he's worried the cap will handcuff the way educational programs are developed.

"I think you still have to go look at the programs you need for kids and then figure out how are you going to pay for them and, if you have to eliminate anything, what goes?" Richards said.

School districts will need to make some tough decisions to meet the cap, on top of cuts from the last few years.

Many local districts have already made significant cuts to staffing, educational programs and other services. The Tupper Lake Central School District, for example, shed 32 positions - 28 layoffs and four unfilled retirements - in 2010.

Goldman noted that his district has closed two buildings, the Lake Clear and Lake Colby elementary schools, and cut its staff from 338 to 296 members.

"I can't be closing another school; I don't have another school to close," he said. "I'm down 34 positions over two years; that's a pile of dough."

Tim Kremer, executive director of the New York State School Board Association, told the Enterprise the tax cap will have a transformational effect on school districts. He said districts across the state have slimmed down to a point where further cuts aren't possible.

Kremer's organization released a report in December that tried to predict the tax cap's impact.

"Everything we're going to do is going to be anticipating a future that is yet unknown," he said. "We've never had a tax cap before. So what we did in putting this report together is, we based it on the theory (that) the best predictor of future performance is past performance."

NYSSBA took actual expense and revenue information from the current fiscal year and put it through the tax levy limit formula. Using data from 121 districts, the report found that 74 percent would have exceeded the cap if it had been in place for 2010-11 budgets.

"What that tells you is either they're going to have to go beyond the cap ... or they're going to have to stay under the cap and probably cut their expenses," Kremer said. "What we came away (with) are some predictions for how school districts will have to accommodate this."

Kremer said school districts will need to look beyond measures like wage freezes and job cuts toward long-term, structural changes. That could include privatizing or sharing services, restructuring salary schedules or combining entire athletic departments.

Local school officials say that's already happening to a certain extent. Saranac Lake and Lake Placid have consolidated their lacrosse and tennis teams, while cross-country skiers from Beekmantown train and race with Saranac Lake's squad. Goldman added that through Franklin-Essex-Hamilton BOCES, districts already share a wide variety of services, including special education instructors.

Richards said local district officials have had a "sincere" conversation about sharing services - two meetings in early 2011. He said the problem, in some cases, is civic and community pride.

"Not that that's a problem, but everybody wants to keep their own identity," Richards said.

Combining the Saranac Lake and Tupper Lake football programs, for example, would end a decades-old rivalry with deep-seated traditions in both communities. Lake Placid and Saranac Lake have a similarly hot rivalry in hockey, as shown when the teams faced off Tuesday.

"Those are pretty big jumps; people hate to give up those local pieces," Richards said.

Still, Kremer said bold decisions will be necessary for districts to survive.

"Unless we make fundamental changes, schools won't be able to provide students with the education they need," he said.

School districts, like towns and counties, will also look to the state in the coming months for serious mandate relief, especially when it comes to special education requirements.



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