School taxes swing wildly as home values decline

As Nassau County officials scramble to fix what they call a "broken" tax system, many ordinary homeowners who had expected modest hikes in their school taxes this year are reeling instead from increases exceeding 10 percent or even 20 percent.

School officials acknowledge they are seeing "wild" swings in taxes this year - possibly, the most dramatic in more than 30 years - and blame the situation on the county's complex and controversial tax assessments.

They say many of those swings are particularly severe this year due largely to dramatic declines in the assessed value of homes. As the value falls, districts must raise tax rates for everyone to wind up with the same amount of revenue. And when school spending goes up - Nassau's average increase for 2010-11 was 2.5 percent - districts need even more revenue.

Assessments blamed

But town tax officials also contend that county assessments are riddled with errors; County Executive Edward Mangano has suggested that assessment errors may cause homeowners and employers to pay "more than their fair share" of taxes.

On Friday, Mangano fired the chief assessor, Ted Jankowski, while Mangano's senior policy adviser, Brian Nevin, promised a thorough review of Jankowski's office, aimed at "restoring the public's faith in our assessment system." Asked whether this would result in any relief for homeowners now overtaxed, Nevin replied that, for practical reasons, an overhaul of the assessment system already ordered by Mangano could not begin until 2012.

Monday, the county is to announce the forming of a transition team to oversee repairs of the assessment system.

Many Nassau taxpayers still wonder when and whether the county will find a way to ease their soaring tax bills and they voice outrage over the bills received earlier this month. School taxes account for more than 60 percent of property tax bills. Suffolk County's bills go out in December.

School taxes are up $2,848, or 22.7 percent, for Ralph Barash, who lives in Plainview's upscale Hamlet community. Barash describes former neighbors who recently sold their houses in frustration, and now divide their time between stays in local hotels and Florida vacation homes.

"It's cheaper to stay in a hotel for three or four months than to pay taxes," said Barash, 77, a retired company chief executive. "It's insane."

Denise Tufano, 45, a Woodbury homemaker and mother of three, is equally incensed that school taxes on her ranch-style house have jumped $2,431, or 15.4 percent. And she hopes the county's promised overhaul provides some relief.

"They have to find another way to figure this out, because it's not working," Tufano said.

School district administrators say they've been doing their best to curb taxes in a struggling economy. Barash's Plainview-Old Bethpage district has set a 2.9 percent increase in its tax levy, which is the total dollar amount raised through property taxes. In Tufano's Syosset-Woodbury district, the tax levy is up 2.79 percent.

Actual increases vary

Those percentages represent only average tax increases, however. Actual tax hikes on individual homes can vary widely, because of fluctuations in assessments and other factors. And school officials say this year's swings have been especially sharp, due to an average 15 percent drop in home values that is the largest in recent history.

That falling home assessments should be accompanied by soaring tax rates strikes many homeowners as inherently unfair. But school and county officials say it's simply a matter of math. When assessed values decline, tax rates have to rise proportionately, to produce whatever school revenues are approved by local voters.

On Wednesday, Jankowski denied that homeowners were experiencing any great volatility in tax bills. But the then-assessor did describe as "extremely complex" the county's system of setting four separate tax rates for homes and other properties, based on assessments that are often two years old.

"Heck - I'm still learning," Jankowski said in an e-mail message.

Hikes average 20 percent

This year's rate increases on homes average more than 20 percent, compared with less than 5 percent last year. That doesn't mean each homeowner pays 20 percent more taxes. To the contrary, a 20 percent rate increase on homes that decline 15 percent in value should translate into extra payments of about 2 percent, school and county officials say. School officials add, however, that tax bills for residential properties are running 3 to 5 percent higher because under Nassau's complicated system the tax burden is shifting more to homes and away from other types of properties.

On the other hand, residents whose homes retain their value - or simply decline in value less than other residences - can find their taxes skyrocketing. In effect, they are paying for their neighbors' tax breaks. And values are determined by a computerized system that county officials now admit is deeply flawed.

"So it's all luck of the draw," said Alan Adcock, assistant superintendent for business in the Massapequa district. "We've seen this year wild swings in people's taxes up and down. I've seen homes with tax decreases of a thousand, and homes with increases of a thousand."

Administrators in other districts agree the problem is widespread. Jericho's superintendent, Henry Grishman, says a spot check of tax bills for 30 homes in his district found changes ranging from a 2 percent decrease to an increase of more than 20 percent. Overall, more than 10 properties had tax increases under 3.9 percent, while about six had increases of 10 percent or more.

"The variance has never been this great," said Grishman, a schools chief for more than 30 years.

Public outrage over property taxes was widely viewed as a key to Mangano's upset election as Nassau County executive last year. In April, Mangano ordered that all homes and businesses be revalued every four years rather than annually - a move he said would stabilize the system and "reduce the number of assessment errors." The freeze on assessments begins in 2012.

Public-policy analysts have mixed feelings about Mangano's move, with some cautioning that a freeze, once lifted, might simply produce greater fluctuations in assessments. But others, such as Martin Cantor, director of the Long Island Economic and Social Institute at Dowling College, see the freeze as a positive first step.

"You stop this herky-jerky motion," Cantor said.

What Long Islanders are saying

RALPH BARASH, 77, Plainview, retired company chief executive

Assessed value: $2,067 (2011); $2,050 (2010); up 0.8 percent

School tax: $15,348.59 (2011); $12,500.45 (2010); up 22.7 percent from last year

Residence: Free-standing house in a planned community that also includes condominiums; adjusted market value, $898,800

Comment: "It's bizarre . . . They're going to force people not to pay."

DAN CARROLL, 78, Farmingdale, retired Grumman employee

Assessed value: $336 (2011); $330 (2010); up 1.8 percent

School tax: $2,536.58 (2011); $2,036.54 (2010); up 24.5 percent

Residence: One-bedroom condominium; adjusted market value, $206,400

Comment: "I thought this has got to be some kind of mistake. But then, everybody said they were getting the same kind of increase."

GABRIELLA GENNARO, 29, Wantagh, office manager

Assessed value: $1,110 (2011); $1,023 (2010); up 8.5 percent*

School tax: $8,218.57 (2011); $6,139.61 (2010); up 33.8 percent

Residence: High ranch; adjusted market value, $444,200

*STAR tax exemption also lost when new homeowner learned of deadline too late.

Comment: "There's no forewarning - there's just a new surprise every year."

STEVEN STRULL, 46, East Rockaway (Lynbrook school district), New York City school administrator

Assessed value: $1,768 (2011); $1,917 (2010); down 7.8 percent

School tax: $12,951.40 (2011); $11,251.01 (2010); up 15.1 percent

Residence: Colonial-style house; adjusted market value, $779,200

Comment: "I opened up my tax bill, and it was a thousand dollars more than I thought I owed - with no warning."

THOMAS M. THOMAS, 54, Floral Park, postal clerk

Assessed value: $1,374 (2011); $1,495 (2010); down 8.1 percent

School tax: $7,614.63 (2011); $6,694.31 (2010); up 13.7 percent

Residence: Colonial-style house; adjusted market value, $621,500

Comment: "The difference is about $900. I wouldn't care, a couple hundred dollars. But this is a lot of money."

DENISE TUFANO, 45, Woodbury (Syosset-Woodbury school district), homemaker

Assessed value: $2,546 (2011); $2,575 (2010); down 1.1 percent

School tax: $18,168.71 (2011); $15,736.98 (2010); up 15.4 percent

Residence: Ranch-style house; adjusted market value, $1,090,300

Comment: "They tell you you're going to get a 3 percent increase, and it goes up 15 percent."