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Guilderland Archives — The Altamont Enterprise, August 11, 2011

GCSD splits windfall between taxpayers and savings account

By Melissa Hale-Spencer

GUILDERLAND — In a split vote last week, the school board here decided to use some of an unexpected windfall to lower the predicted tax rate, and to save the rest in a rainy-day account.

Guilderland residents will pay $20.68 per $1,000 of assessed valuation on their tax bills next month.

When voters went to the polls in May, passing an $89 million budget for the upcoming school year, the district estimated that the tax-rate increase for Guilderland residents would be 3.48 percent. At that time, town assessments were not yet available, nor had the state set equalization rates.

The district had made a conservative estimate that assessments would remain the same. As it turned out, assessments in Guilderland, which accounts for about 94 percent of the district’s tax base, increased by $14.4 million, while assessments in Bethlehem, about 6 percent of the tax base, went up $2.9 million.

According to John Macejka, assessor for the town of Guilderland, the overall assessment total for the town is $2.999 billion; divided by the new state-set equalization rate of 86.25, this means the taxable value is $3.477 billion.

Macejka attributes the $14.4 million increase not to any single large project or development but rather to incremental changes. Twenty new homes were added to the Guilderland tax rolls this year, he said, and there were many instances of home improvements. “In spite of the poor economic times,” said Macejka, “there were quite a few renovations and additions.”

Also, there were increases in the values of special franchises in town, which amount to about 40 parcels. These are for railroads and utilities like gas, phone, and computer lines. Those assessments are set by the state.

“We tend to be a little conservative,” said Macejka, “when we give out to school districts what we think the increase will be. I think that’s the responsible thing to do.”

The $14.4 million increase on which the school district has set the tax rate won’t go up but still could go down, noted Macejka this week. “It’s subject to change with court orders and small claims hearings that are not factored in.”

School tax bills are to be mailed to district residents by Labor Day and are to be paid by Sept. 30 without penalty.

Three choices

The school board considered three choices in setting the tax rate.

If the district were to keep the tax-rate increase at 3.48 percent, as originally estimated, that would mean an additional $400,000 could be placed in its fund balance. This would be 70 cents more per $1,000 of assessed value than Guilderland residents paid the year before.

On the other hand, if all of the extra were returned to the taxpayers, the rate for Guilderland residents would go up 2.81 percent — 56 cents more per $1,000 of assessed value.

The district recommended a middle course — “striking a balance,” said Assistant Superintendent for Business Neil Sanders. This would increase the fund balance by $250,000 and set the tax-rate hike for Guilderland residents at 3.23 percent — 65 cents more per $1,000 of assessed valuation than paid the year before.

“It’s still below what voters anticipated but gives us flexibility,” said Sanders, noting that the economy is in bad shape and a tax-levy cap looms on the horizon. He compared the stock market to a rollercoaster and said, “We need financial resources to weather that storm.”

Sanders said that the district’s fund balance is between $5 million and $6 million; by law, it can’t be more than 4 percent of the next year’s budget. Sanders said that, with the additional money, he believed the fund balance would still be under that mark.

Board member Barbara Fraterrigo asked if $30,000 or so could be used to hire back a German teacher who was let go because of budget cuts. Sanders replied that would not be possible as the expenditure side of the budget is set by what the voters passed.

Board member Richard Weisz said that, if the board had known before the vote what the assessments would be, it could have had $400,000 more to spend.

“Don’t we have a stupid system?” he asked, noting the foreign-language program at the elementary level could have been saved, and the Friends of Guilderland Athletics wouldn’t have to work so hard to raise half the funds for freshman sports.

Board member Allan Simpson made an argument similar to the one he had made the year before — that the money should be returned to the taxpayers. He pointed out that the additional money in the fund balance wasn’t used last year.

Sanders responded that next year, the district would lose federal money and aid from the state for its conversion to full-day kindergarten; he also said that investment earnings are down.

“There are a lot of people struggling right now,” said Simpson. “I know people where every nickel counts, [where it’s] hard to put food on the table.”

“For me,” countered Weisz, “this is an edge on four jobs for next year…I would prefer to have a cushion. If the only way to meet our budget is to lay off staff, it would make me sad.”

Last year, when setting the tax rate, the board was presented with two choices — save the extra money since, again, assessments had been higher than expected, or return it all to the taxpayers. The district recommended saving the surplus. Simpson alone had favored returning the extra money to the taxpayers; this year, Emilio Genzano joined him.

The year before that, again presented with the choice of either returning extra money to the taxpayers or saving it, the board voted, 6 to 1, to use the money from rising Guilderland property assessments to reduce the tax rate — to $19.34 per $1,000. That was the first time in memory that Guilderland school taxes went down. The district had recommended decreasing the taxes.

This year, the district recommended a third, middle-ground option and the board majority voted for the district recommendation as it had in the previous two years.

Tax rates

Although Guilderland is the dominant town in the district, small parts of three other towns — Bethlehem, New Scotland, and Knox — also lie in the Guilderland School District. Since each town assesses property differently, the state sets an equalization rate to level the paying field.

In Guilderland, which has an equalization rate of 86 percent, residents will pay $20.68 per $1,000 of assessed value, an increase of 3.23 percent, or 65 cents over last year.

In Bethlehem, which has an equalization rate of 97 percent, residents will pay $18.39 per $1,000, an increase of 4.68 percent, or 82 cents more per $1,000 than last year.

In New Scotland, which has an equalization rate of 96 percent, residents will pay $18.58 per $1,000, an increase of 2.50 percent, or 45 cents per $1,000.

In Knox, which hasn’t revalued properties town-wide in years, the state set the equalization rate at 57 percent so residents will pay $31.30 per $1,000, an increase of 4.68 percent or $1.40 per $1,000 of assessed valuation.

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