School tax cap debate eyes California, Massachusetts
Melissa Abbate, 16, writes an essay required to achieve international baccalaureate credentials. She is enrolled in an international baccalaureate program at Commack High School. (Aug. 31, 2010) Credit: Newsday / Audrey C. Tiernan
In the ongoing debate over whether to cap Long Island's school taxes, taxpayer groups point to Massachusetts as an shining example while school groups counter by citing California as an abysmal failure.
In 1980, Massachusetts imposed statewide property tax caps under a referendum known as Proposition 21/2 because it set the annual limit for taxes at 2.5 percent. Its math and reading test scores now rank as the nation's highest.
California passed Proposition 13 in 1978 that limited raising property tax to no more than 2 percent a year as long as the property was not sold. Now, its test scores rank among the lowest two or three states, along with Alabama and Mississippi.
Long Island school officials contend the effect of tax caps in New York would more likely resemble California than Massachusetts. "Massachusetts is very different from New York - it doesn't have the high level of poverty," said William Johnson, superintendent of Rockville Centre schools.
The percentage of children in Massachusetts living in poverty is 16 percent compared with 19 percent in California and 20 percent in New York, according to the National Center for Children in Poverty at Columbia University, which drew on census data.
Analysts point out that Massachusetts schools also benefitted from increased state aid to municipalities - and thus, indirectly to school districts - to compensate for insufficient revenue from local property taxes.
The push for tax caps in New York became a topic of debate this summer when state Attorney General Andrew M. Cuomo launched his gubernatorial campaign by announcing he would push for a 2 percent cap on annual increases in property taxes.
The restriction would apply to all local governments, but its impact would be greatest in school districts, which account for about two-thirds of property taxes.
Cuomo notes that this state's property taxes are among the highest in the country. And he asserts that residents "will vote with their feet and leave" if taxes keep rising. A big win in November could strengthen Cuomo's bargaining position with State Assembly Speaker Sheldon Silver, who questions the 2 percent limit but insists he can work with Cuomo.
Among the Republican candidates, Rick Lazio favors a 2.5 percent cap while Carl Paladino favors outright cuts in taxes.
School representatives insist tax caps would inevitably widen the spending gap between rich and poor schools and they offer this example: Say, District A and District B both have $100 million budgets. District A is affluent, so state aid provides only 20 percent of its revenue. District B is poorer, so state aid provides 60 percent of revenue.
Now, suppose both districts want to raise next year's spending by a modest 1 percent, or $1 million. With property tax increases capped at 2 percent, District A, which gets $80 million from taxpayers, can raise $1.6 million - more than enough to meet its goal. District B, which gets $40 million from its taxpayers, can raise only $800,000, and winds up $200,000 short.
