More About the Tax Cap

See what the New York State School Boards Association has to say about the tax cap:

http://www.nyssba.org/clientuploads/nyssba_pdf/NYSSBA-Tax-Cap-Q&A.pdf

The New Meaning of the Contingency Cap

March 20, 2012--Pre-Budget Hearing


Forget almost everything you once understood--or thought you understood--about contingency caps. The new New York State law about contingency caps for school budget votes that are twice declined by the voters means one simple thing: school districts cannot collect more in the tax levy than they did the previous year. This means a zero percent tax levy increase (which does not necessarily translate to a zero tax rate increase, a calculation dependent upon assessments and equalization rates). Regardless of necessary increases in spending due to salaries, benefits, fuel costs, interest rates, or the price of pencils, the tax levy cannot increase under a contingency cap. 


Is this a serious concern at Haldane? Absolutely. For the past few years Haldane's Board of Education has presented spending plans for voter approval which contain, according to Superintendent Mark Villanti, incremental reductions to staff and adjustments to benefits in order to cut costs and balance the budgets. This budget, which the school board is likely to adopt at the next Business Meeting on April 10, includes reducing the staff by one full time teacher and one part time driver, refinancing the debt on the high school building, realizing savings in breakage from teacher retirements, reducing some benefits costs, and utilizing some reserve funds and fund balance to meet reductions sought by the school board for a lowest-possible budget increase. (See Dr. Villanti's 3/20/12 presentation here) Budget-to-budget, the spending plan has become leaner, and the "low hanging fruit" has been picked clean. Future cuts will, of necessity, be painful.


Consider this: the budget-to-budget increase over 2010–11 is $297,463. A contingency cap will mean a budget cut of $415,629. To give readers an idea of what this number means for Haldane, the athletics portion of the budget (see Budget Proposal #3, and then go to page 13) which does not include the salary of the Athletics Director is $303,898. Cutting this entire portion of the budget would still require additional spending cuts elsewhere. (NOTE: The District has no plans to eliminate athletics, this is simply to illustrate the potentially devastating impact of a contingency budget.) 


Dr. Villanti has characterized this budget year as a two-headed dragon because the new mandate for a tax cap combined with the formula which was revised a few years ago for calculating state aid (the Gap Elimination) creates considerable economic pressure on the school to balance its budget. The tax cap effectively discourages the district from seeking an above-cap tax levy to pay for rising costs, and at the same time the district bears the burden of reduced state aid. To navigate the budget process in the years to come, without some concessions for state aid or other forms of revenue enhancement, will likely become increasingly difficult if the school hopes to maintain excellent programs. 


Other business at the 3/20/12 meeting included two special presentations, from Seamus Carroll, Chairman of the Fine Arts Committee, and HS Principal Brian Alm provided an update on the iPad Pilot program. Mr. Carroll offered a succinct, clearly defined abstract of a larger project proposal for refurbishment of the Haldane Auditorium, which included a timeline for each phase of the project. The Board voted to approve matching a Haldane School Foundation donation to fund Phase 1, the Projection Room conversion to a Control Room with new sound and lighting controls. This work should begin over the summer as it will involve some asbestos abatement in the demolition portion of Phase 1.


Mr. Alm's presentation on the iPad Pilot program focused on the enhanced learning opportunities a digital device can provide for students. "It's about digital collaboration," he said, offering examples of how students can use the iPads to practice and improve 21st century skills. Mr. Alm recommended that Haldane should look at the iPad initiative for another year and then possibly go forward to phase in the devices for one entire grade level to use.


The next school board meeting is scheduled for April 10, 2012 at 7:00 pm in the Mabel Merritt Building Fireplace Room (or Board Meeting Room). The Board will formally adopt the budget which will be presented to voters at this meeting. The Board will also hear and decide on tenure recommendations at this meeting. Please note the following changes to the district schedule due to snow make-up give-back days and State Education Department changes in test scoring dates:

1. May 25, 2012--give-back day NO SCHOOL
2. April 9, 2012--give-back day NO SCHOOL
3. April 27, 2012--scoring day change SCHOOL IN SESSION

Another schedule change:
Earth Day Family Night Rescheduled from April 27 to May 4, 2012. This year's theme is Student Advocacy for the Environment.

March 20 Haldane Pre-Budget Hearing

Voters will have an opportunity to hear and comment on Haldane's Budget (or Spending Plan) on Tuesday, March 20, 2012 at 7:00pm in the Board Meeting Room. A recently-revised draft version of the budget is available on the Haldane School website. Public input is sought now, and especially in Tuesday's public meeting, before this budget is adopted by the Board and presented for voter approval. 

Changes and challenges to the budget process this year: 

Superintendent Mark Villanti has illustrated the mounting pressures to school funding, including the Tax Cap and state aid reductions through the Gap Elimination Adjustment. For Haldane, this adjustment accounts for a $500K cut in state aid each year over the past few years. Thus far, Haldane has been able to weather these cuts because of Federal ARRA money and by using savings from its own reserve funds. However, the ARRA money has run out, and district savings will as well. 

Dr. Villanti has suggested that the public may consider writing to New York State representatives in Albany to request reform to the Gap Elimination. Without some reform in Albany, school budgets face pressures which will continue to seriously undermine public school funding next year and for the foreseeable future, and risk decimating New York State public education.

Some definitions:

Annual Budget (or, more accurately, the Annual Spending Plan): the total amount of revenue the School Board determines will be needed to pay all of the district's bills for the entire year. The Spending Plan is what voters decide to approve on Budget/Trustee Vote Day, May 15. The Board of Education must try to craft a budget so that there are adequate funds to see the district through the entire school year. If a district overspends its budget, and if the money runs out before the end of the school year then bills will go unpaid (unless the district borrows additional money to pay for them). At the same time, a district is not allowed to hold more than 4% of the budget in its fund balance left over from the prior school year. The difficulty in budgeting is to balance having enough money—but not too much—in the district checking account, simultaneously bearing in mind the financial burden on taxpayers.

Revenue: income from property taxes, government aid, tuitions, and grants.

Tax Levy: the number of dollars collected through taxation. In the case of a school district's Tax Levy, this includes the portion of the dollars collected from property tax which are specifically allocated for the school district. In Philipstown the school tax bill is separate from the Town tax bill. A property owner's total property tax bill will include both municipal (i.e., town, village, fire department, etc) and school taxes. Haldane's Tax Levy for the 2011–12 fiscal year was $16,996,875. 

Tax Cap: a calculation defined by New York State which limits the Tax Levy Revenue to a maximum dollar amount. Budgets (or Spending Plans) whose Tax Levy Revenue falls under this Cap would need only simple majority approval by voters. A School Board may present a budget which is over the Cap, but a super majority of voters (60%) would be needed to pass an over-Cap budget. This year for Haldane, the Tax Cap is calculated at $17,586,003. It should be noted that this is not a "2% Cap," which is a misnomer. This Tax Cap for Haldane as calculated following New York State rules is actually 3.16% over the 2011-12 levy. However, the Haldane Board of Education is seeking to whittle the spending further to a levy of $17,462,504, which is below the Tax Cap.  

Tax Rate: a calculation defined by assessments and equalization rates which are set by the county New York State Office of Real Property Services. Voters often ask, 'How much are my taxes going to increase with this budget?' This is a difficult question to answer with precision. The tax rate is defined in August, after the budget (or spending plan) vote and therefore cannot be determined—only estimated—during budget season. With the anticipated cuts requested  by the Board, the projected tax rate for the 2012–13 budget year will be approximately 1.95%. Haldane makes every attempt to make a conservative estimate, and last year's tax rate was actually lower than what was estimated at budget time.

Absentee ballot applications and Haldane Board Trustee candidate petitions now available

• Petitions for nominating candidates for the office of Member of the Board of Education, Applications for absentee ballots for election of a Board Member and the Budget may be applied for at the office of the District Clerk. Such application must be received by the District Clerk at least seven days before the election if the ballot is to be mailed to the voter, or the day before the election if the ballot is to be delivered personally to the voter. 
• Petitions for nominating candidates for the office of Member of the Board of Education must be filed with the Clerk of the District no later than April 16, 2012 between the hours of 9:00am and 5:00pm. 

Special Budget Meeting 3/13/12 at 6:30 pm

The Haldane Central School District Board of Education will meet on Tuesday, March 13, 2012 at 6:30 PM in the Board Room of the Merritt Building in order to continue their conversations related to the 2012-2013 School Budget. 

Also, nominating petitions are now available in the District Office and on the Haldane website for those interested in pursuing a candidacy for one of the available Board of Education Trustee seats.