State tax cap shrunk to 1.66%

A state tax cap imposed on governments and school districts will be a bit more restrictive in 2014 due to a decline in inflation.

The cap limits the amount school districts, counties, cities and towns can increase their tax levies annually. The cap has been 2 percent since 2012, but will be reduced to 1.66 in 2014, according to the formula from the New York state comptroller.

Gov. Andrew Cuomo, a Democrat and Westchester resident, made reining in skyrocketing property taxes a focus upon his election in 2011. Municipal government and school district officials have criticized the cap for being a hindrance to local budgets, forcing cuts and coming without relief of unfunded state mandates that drive a majority of public sector budgets.

State Sen. Greg Ball, a Patterson Republican, supports the tax cap, but announced he has set up a mandate relief advisory council” and will be hosting an “Unfunded Mandate and Tax Relief Roundtable” at Mahopac High School Sept. 7.

“From burdensome testing requirements to local reporting nightmares and mountains of administrative bureaucracy, there is a great deal that Albany can and must still do to lighten the administrative stranglehold on our local governments and schools,” he said. “Simply put, there are myriad opportunities for Albany to deliver relief and we should get back to Albany to do exactly that.”

Although the levy cap is set at a 2 percent increase annually, a complex formula and several exceptions can slightly alter the levy allowable for local municipalities. The cap cannot exceed the rate of inflation, based on a 12-month average of the consumer price index. The formula is determined six months prior to the start of the fiscal year.

Governments can override the tax cap by a supermajority vote. School districts, whose budgets are voted upon in public referendum, must receive 60 percent voter support of a budget that overrides the tax cap.

Locally, overrides of the tax cap have been rare. Notable instances include the village of Bronxville, which overrode the tax cap in its 2012-13 fiscal year after consecutive, cap-free years in which it issued zero percent increases.

The Scarsdale Union Free School District issued a cap-busting $144 million budget that was soundly defeated in a record-turnout vote, the first time a Scarsdale budget had failed to get community support since the 1970s. A revised budget, now under the cap, was approved by voters in a June revote.