Canisteo, N.Y. – A quirk in so-called 2 percent tax cap legislation passed last June could mean any proposed Canisteo-Greenwood budget not at least $24,520 less than the 2011-2012 plan will require 60 percent voter approval rather than a simple majority this May.
An incongruous culprit in the issue: a Howard wind farm that most town taxpayers probably consider a financial windfall, district superintendent Dr. Jeffrey A. Matteson said.
The complicated tax cap formula in future years will have a payment in lieu of taxes or PILOT to compensate for previous year PILOT deductions, Matteson explained to board members Monday night. Typical transactions envisioned in the legislation were simultaneous “PILOT payments out for a previous year and PILOT payments in” for the following year, he said.
The initial PILOT deduction with no offsetting credits apparently is an unintended consequence of tax-cap legislation harming taxpayers during the first year of implementation, Matteson said. Framers of the tax cap regulation apparently ignored the first year when no PILOT credits exist, he said.
The superintendent said a more accurate definition of the new formula is that the complex eight-step calculation results in the maximum allowable tax levy (MATL). That number may be more or less than 2 percent, he said.
Any school district budget of more than the calculated MATL, no matter the percentage, requires approval from a supermajority of 60 percent of voting district taxpayers, he said. After two failed school budget votes, any adopted budget must have a zero percent increase in the tax levy, he said.
The $21,192,430 district budget last May was approved 367-to-99. Meeting current tax cap legislation will require a district budget of $24,520 less or $21,167,910. “Even one dollar more will require a supermajority vote,” the school superintendent said.
The legislation name, 2 percent tax cap, is simplistic, Matteson said: Expenses such as local capital expenditures, certain pension payments and court judgments are exempt from the cap. In fact, a district’s final tax levy after exemptions could be greater than the 2 percent tax levy limit and still be legally within that limit, he said.
Howard is one of 11 Allegany and Steuben counties townships in the 100-square-mile Canisteo-Greenwood Central School District.
Another school district in New York state must reduce its budget $16 million with the existing formula, Matteson said.
State education department staff are contacting impacted school districts throughout the state to determine if “the tax cap formula needs repair,” Matteson said. The superintendent’s opinion: The cap “should protect tax payers but not punish school districts” as it does now, he said Monday.
State staff are canvassing all school districts to determine if legislation should be introduced before the March 31 deadline for a state budget, Matteson said. Gov. Andrew Cuomo and the Legislature met the deadline last year.
In another matter, board members asked Matteson to schedule meetings with the three lowest bidders of a request for proposal from architects and engineers to discuss a study of district facilities. A committee of teachers, administrators and board members last year surveyed conditions of the three district buildings to develop a capital project using some of $900,000 in capital reserves and approximately 98 percent state building aid reimbursement, Matteson said.
Matteson said the deadline for receiving up to 98 percent state building aid is July 1, 2014, 10 years after the merger of Canisteo and Greenwood schools. The board Monday night ironically voted unanimously to close the Greenwood middle school.
Board-selected architects and engineers will examine committee priorities next summer and present a capital project proposal next fall, Matteson said.
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