Deborah A. Coder, Assistant Superintendent for Finance and Management Services
February 7, 2018

Current Expenditure Budget

• As of February 7, 2018 – The 2018-2019 Expenditure Budget amount is:
• $100,174,970 or 3.47% above last year. Net expense reductions of $ 777,457 have been made as a result of upcoming retirements and resignations. 

Summary of Changes to Expenditure Categories

• RETIREMENTS/RESIGNATIONS as of 2/1/2018
  • Six (6) Elementary Positions
  • Two (2) Secondary Positions
  • Two (2) Special Education Positions
  • Five (5) Special Area Positions
  • One (1) Administrator Position
  • Three (3) Support Staff Positions

Net Employee Salaries/Benefits increases were: $2,057,270
Net Employee Salaries/Benefits increases now: $1,279,813
Expenditure Budget decrease of: $777,457

Summary of Changes to Revenue Budget

• USAGE of RESERVES
  • Projected Reserve usage was: —$2,145,958 
  • Projected Reserve Usage is now: —$2,629,047
  • Revenue Budget increase of: —$483,089
• TAX LEVY CAP ADJUSTMENT
• Tax Levy Cap was: —$758,796
• Tax Levy Cap now: —$758,796
• Tax Levy Cap decrease of: $0
• Revenue Budget Net Increase $483,089

 2018-2019 Tax Levy Impact

• Current Expenditure Budget  $100,174,970
• Preliminary Revenue Budget  $60,780,440
• Preliminary 2018-19 Tax Levy Needed  $39,394,530
• 2017-2018 Current Tax Levy  $37,658,476
• Preliminary Tax Levy Increase   $1,736,054

2018-2019 Tax Levy Limit Calculation

• Simple Majority Limit is 2.014941873739130% or $38,417,272
• Current Tax Levy Amount is $39,394,530
• This budget is OVER the Tax Levy Limit by $977,258

Next Steps

• By March 1st, 2018 the district must certify with the Office of the State Comptroller the estimated tax levy increase for the 2018-2019 fiscal year.
• The district must also declare its intentions in this certification on whether or not it intends to exceed the Tax Levy Limit Cap.
• If the district exceeds the cap it must have a 60% or greater passage rate at the May budget vote.

Property Tax Cap Legislation

Overview

School districts generally may not adopt a budget that requires a tax levy that exceeds the prior year's levy by more than 2% or the rate of inflation, whichever is less, unless they officially override the tax levy limitation.

The Tax Cap is Not Always 2%

• The allowable levy growth factor is equal to the lesser of 1.02 or 1 plus the inflation factor.
  • Inflation factor calculation is defined by law
• School Districts have an allowable levy growth factor of 1.0200 for the 2018-19 fiscal year.

Calculation Involves Several Components

• Prior Year Levy
• Allowable Levy Growth Factor - 2% or rate of inflation, whichever is less
• Tax Base Growth Factor
• PILOTS
• Carryover
• Exclusions (Capital, Retirement and Torts)

Override For School Districts

• The law allows school districts to override the levy limit.
• If a district intends to override the tax cap law, a ballot statement must be included.
  • At least 60% VOTER approval required.
  • If an override budget fails to get 60%, the school district can:
    • Resubmit the original budget (requires at least 60% voter approval when it's an override budget)
    • Submit a revised budget
      • If revised budget contains a tax levy within the levy limit, then only 50% voter approval required but if the revised budget seeks to override the levy limit, then at least 60% voter approval is required.
    • Go to a contingency budget (0% levy growth)

Reporting Requirements

• School District CFOs must calculate the tax levy limit and report the data elements to the State.
  • Must use OSC's form to report.
  • User IDs and Password are required to access and submit forms.
  • Form must be submitted by March 1st.
• Report must be submitted even if an override is planned.

Property Tax Relief Credit

Overview

• Property Tax Relief Credit
  • Tax Law Section 606 (n-1)
  • Provides a Real Property Tax Credit to qualified taxpayers between 2016-2019
• Program only applies to School Districts and the Big 4 Cities (Buffalo, Rochester, Syracuse and Yonkers)
• To qualify for the credit
  • School District must certify that tax levy is within the levy limit
    • Certifications is submitted in the same portal as the Tax Cap form (OSC Online Services)
      • Click on link for Tax Cap Compliance
    • Certification is due by July 21st.
  • Qualified taxpayers must:
    • Live in a school district that is complying with the tax levy limit law
    • Receive the Basic or Enhanced STAR property tax relief
    • Have an income of $275,000 or less

What does this mean for Lockport

• Scenario #1 Increase Revenue
  • 2018-2019 State Aid Increase: $1,332,600
    • If 2018-2019 State Aid DOES NOT increase: $0     
      • Current amount over tax levy limit: $977,258
      • Amount needed to adhere to tax cap: $977,258
• Scenario #2 Reduce Expenditures
  • 2018-2019 Expenditure Increase: $ 3,356,503
    • Current amount over tax levy limit: $977,258
    • Amount needed to adhere to tax cap: $977,258