To the long list of things at stake in the crafting of any state budget -- taxes, school aid, etc. -- add one more item this year: how to encourage school district mergers. The prospects for making the process easier, finally, look promising. Both Gov. Andrew M. Cuomo and a pair of Long Island legislators are trying to use the budget process to smooth the bumpy road to consolidation. Their proposals are similar and need to be reconciled, but each offers an easier merger path that deserves support from the State Legislature.
Cuomo and the team of Sen. Kenneth LaValle (R-Port Jefferson) and Assemb. Fred Thiele Jr. (I-Sag Harbor) are separately tackling one of the thorniest issues in school mergers -- property taxes. In virtually all mergers, taxes go up in one district and fall in the other. That rarely sits well with residents whose taxes will rise, and if the increase is too big, the merger proposal typically is voted down.
That's what happened last fall with a seemingly everybody-wins merger of two East End school districts, Southampton and Tuckahoe. The proposal was sensible in so many ways -- among them, the financial future for each district without a merger is troubling. But Southampton's taxes would have risen nearly 9 percent, Tuckahoe's would have declined 65 percent. Southampton voters rejected the merger by a solid margin.
Cuomo's plan would phase in any change in taxes over 10 years. For Southampton, that would mean an increase of less than 1 percent a year, which in most years would be offset by the rise in assessed value in the district.
LaValle and Thiele's plan is more complicated. It would freeze for the first year the tax levy of the district whose taxes would rise, with the other district making up the difference. So Southampton's taxes would not change in Year 1, while Tuckahoe's would decline by 38 percent, with the reduction coming from budget savings in the combined district. And the proportion of the levy paid by each district's taxpayers would remain in perpetuity. That means tax increases each year would be the usual, presumably small, increases subject to the 2 percent tax cap.
Each plan is practical, and fair to taxpayers in both districts.
There are two other praiseworthy elements to the LaValle-Thiele plan. One would allow Southampton to take $9 million in a capital reserve fund for a new administration building it would no longer need and convert it into a tax reduction reserve fund. The second would increase state merger incentive aid in a case in which a wealthy district such as Southampton is annexing a high-needs district, like Tuckahoe.
In responding to one failed merger, Cuomo and the legislators could facilitate a host of consolidations -- a welcome development, given the potential savings for taxpayers. A half-dozen school districts on the East End alone have expressed interest in some form of consolidation and are monitoring the outcome. A handful of districts upstate also are studying merger plans. A successful Southampton-Tuckahoe merger under new guidelines could set a tone for a generation of mergers.
The timing is good. Cuomo has been trying for years to create a climate for mergers and his budget includes incentives for all layers of government to consolidate. And property tax relief -- especially in this election year -- is a white-hot issue. Cuomo, LaValle and Thiele need to agree on one proposal and the legislature needs to approve it. School mergers are too important to let this opportunity slide.