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Health & Fitness

"Two Percent Tax Cap" on Trial Today

Nine LI school districts are holding "Do-Over" budget votes today. The "Two-Percent Tax Cap is on the line.

Nine Long Island school districts are holding “do-over” budget votes today, including two Kindergarten through fifth grade school districts in Nassau County (Elmont & Floral Park-Bellerose) and seven various-sized districts in Suffolk, including very wealthy Mount Sinai and Three Village, altogether representing 25,721 students.  Averaging 2,800+ students, these districts range in size from 178 to 7,296.

If any of these budgets fail, then the tax levy will be frozen at its current level. Zero tax levy increase.  That is a significant incentive for frustrated taxpayers to turn-out and vote down any of those budgets.

Of course, a defeated budget and a frozen tax levy will have program and employment repercussions which no parent and most students would never want to confront.

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But the point of this blog is not about the fallout in the schools.  It is about the “two-percent tax cap”, which I deliberately surround with quotation marks in deference to the fact that, despite our governor and legislators running around touting the “two-percent tax cap”, is not a tax cap at all, and certainly is not a two-percent cap.  But worse, and this is my considered personal opinion, I believe that the current tax levy cap legislation is not constitutional at its core, and my premise could be born out as a result of today’s “do-over” budget votes.

If several of these budgets, or even all of them fail today, then those districts run the risk of becoming insolvent, unable to make scheduled bond payments and possibly unable to meet payroll and benefits payments.  (Pension payments are not at risk, as the state can simply deduct district pension assessments from their  state aid payments). Bonds and other contracts are protected by the state and federal constitutions, and, the New York Constitution gives school districts the right and power to levy taxes in order to fulfill obligations to bondholders and other contracts.

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If any of these districts becomes financially unable to make bond or other contractual payments, and asserts as a reason their frozen tax levy, then I believe the bogus “two-percent tax cap” would be declared unconstitutional.

This would be no great loss to taxpayers, since the cap doesn’t do what it was advertised to do, cap taxes. Then perhaps the legislature will address the real problems with school taxes: excessive spending by school boards, and, those mandatory killer public pension plans.

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