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DiNapoli: Most budgets comply with tax cap

State Comptroller Thomas DiNapoli has said in a

State Comptroller Thomas DiNapoli has said in a report that local sales tax revenue on Long Island grew at a slower rate last year than in other parts of New York. (Feb. 23, 2011) Credit: Howard Schnapp

ALBANY -- Most municipalities and taxing districts managed to pass budgets that stayed under the new 2 percent property tax cap, but a few exceeded it improperly, state Comptroller Thomas DiNapoli said Monday.

Out of a sample of 798 audited budgets, 73 percent stayed under the cap, 22 percent chose to override the cap as is allowed under a tax-cap law passed last year and 5 percent exceeded it inappropriately.

"Basically we see general compliance," DiNapoli said at a breakfast with reporters. Those that inappropriately broke the cap did so through miscalculations, he said.

"We'll continue to work with them to make sure that they understand what they have to do in the future and the need for them to set up a reserve if they collect more money than they're supposed to," the comptroller said. In some instances the comptroller's office was able to catch errors or misunderstandings before the tax bills went out, he said.

State lawmakers last year passed legislation that limits growth in the property tax levy to the lesser of 2 percent or the rate of inflation. The cap does not apply to New York City.

The 43 municipalities and districts that breached the cap improperly were upstate. In percentages, the errors ranged from 0.1 percent to 15.4 percent and in dollar amounts from $142 to $154,760.

While the comptroller's office plays an oversight role, it is also trying to help localities avoid problems as they go through the learning curve of applying the new law, DiNapoli said.

Because school districts' budgets were completed before the cap was passed in June, their budgets won't be affected until they pass budgets for the next school year beginning in the fall.

While municipal boards can vote to exceed the caps, school districts will need such approval directly from their voters.

Steven Hancox, deputy comptroller for local government and school accountability, said about 4,100 units of government will be covered altogether, including towns, fire districts, counties and cities, as well as villages whose fiscal years generally starts June 1. Some costs, including tort payments and certain increases in pension costs, are exempted from the cap, he said.

"Certainly, in this era where pension costs are going up, the actual calculated cap is more than 2 percent," Hancox said.

DiNapoli also said Monday that the New York State and Local Retirement System, which had almost 673,000 state and municipal workers and almost 352,000 retirees at the end of its last fiscal year, will again need bigger contributions from government employers to continue to offset losses from the stock market crash three years ago. "I expect there most likely will be an increase next year," DiNapoli said.

With The Associated Press

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