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New York's new cap law holds down school tax hikes

Voters head to the polls at Spring Valley

Voters head to the polls at Spring Valley High School to vote on the East Ramapo Central School District's 2012-13 budget. (May 15, 2012) Credit: Angela Gaul

So far, the new tax cap seems to be doing its job, controlling the budget and tax increases of school districts.

Across New York State, schools proposed to increase levies by an average of 2.2 percent -- among the lowest in years. Voters in the majority of Westchester, Orange, Ulster and Putnam school districts approved their budgets. In Rockland County only one budget, East Ramapo's, was rejected; its board had proposed a 1.91 percent increase.

Of the five districts in the region trying to exceed the cap, two -- Highland and New Paltz -- fell short of the necessary 60 percent approval. Statewide, 24 out of 675 budgets were defeated, and the failure rate was much higher for districts that tried to exceed the cap on property tax increases than those that did not.

The new law holds down taxes in two ways. Districts know they need 60 percent approval to break the cap -- which limits property tax increases to 2 percent, plus a bit more for exceptions like increased pension costs. But they also know if they lose that first vote, and then a second plan goes down in a later vote, their budgets will be frozen.

That's a far cry from the "austerity budgets" that used to kick in after two "no" votes. Austerity budgets often included significant tax increases.

There's no shortage of money in the school districts. Average spending per student in Westchester County is $24,000, one-third higher than the statewide average, and the state is among the highest in per-student spending and teacher salaries nationally.

Think about what that means: The 25 students in a typical classroom have about $600,000 devoted to their education each year, yet when budget time rolls around we're often told by district administrators and the education establishment that it isn't enough.

Districts spent freely for years on teacher contracts and administrators, as well as for benefit packages that far exceed the ones most employees in the private sector enjoy. Those costs have to be brought under control, and the only way is to control the flow of money.

So the tax cap is working, but not just because it generally controlled costs. It also allowed voters in three Hudson Valley districts -- Pocantico Hills, Tuxedo and Kiryas Joel -- to override the cap and devote more money to their schools. That's their right, and it should be possible. It just shouldn't be easy. And thanks to a well-designed tax cap, it no longer is.


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