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Valley Stream school district sets tax levy amid tax lawsuit

The Green Acres Mall tax break is at

The Green Acres Mall tax break is at the center of a lawsuit over school tax levies in Valley Stream. April 27, 2017 in Valley Stream. Credit: Howard Schnapp

A Valley Stream school district has set its property tax levy amid a lawsuit spurred by tax breaks granted to the Green Acres Mall.

The Valley Stream Central High School District sued one of its three elementary districts, District 24, in Nassau County Supreme Court over $1.4 million of its tax levy that District 24 withheld earlier this year. The districts are due to return to court next month.

The school districts are at odds over the tax levy funding formula. District 24 officials have said they believe properties that receive payments-in-lieu-of-taxes — such as the Green Acres Mall — should be treated as if they remain on the tax rolls. Valley Stream Central High School District officials say the formula should be calculated as if the PILOT properties are not on the tax rolls.

PILOT tax breaks are granted by industrial development agencies and allow developers to pay lower taxes for several years in exchange for economic development and job creation.

District 24, one of three elementary school districts that forwards a percentage of its tax levy to the high school district, withheld about $1.4 in taxes from the high school district in May over the funding formula dispute. The high school district sued in June to get the money, which remains in a custodial account until the lawsuit is resolved.

Under Nassau County administrative code, school districts must set their 2017-2018 tax levies by Aug. 15. Nassau Supreme Court Justice Jack Libert said he would probably not issue a decision before then.

“We’ve got to get the tax levy in or we’re all in a tough place,” high school district attorney John Gross said Wednesday after a court appearance.

On Aug. 2, District 24’s board of education set its tax levy at $40.46 million — $20.3 million of which will be given to the central high school district. District 24 used the high school district’s formula, where PILOT properties are not counted, but reserved the right to contest it.

“It was a matter of making sure the operations for both school districts would go forward while we await the judge’s decision,” District 24 attorney Michael Raniere said after Wednesday’s court appearance.

If District 24 had used the formula it contends is correct, it would instead pass on $18.2 million to the central high school district, Raniere said.

The attorneys are to return to court on Sept. 6 to “iron out as much as we can” and come up with an undisputed statement of facts, Gross said.

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