By CRAIG FREILICH

As students settle into a new year, St. Lawrence County school boards soon will face another budget cycle with rising costs and even tighter limits on tax increases.

While schools got more in state aid for the current year than last year, they are still well behind where they think they should be. And with state tax cap expected to limit tax levy increases to less than 1 percent next year, budget pressures should be even greater.

“Overall, it was better this year. Schools got more aid this year,” said St. Lawrence-Lewis BOCES District Superintendent Thomas Burns.

“But the Gap Elimination Adjustment continues, and as long as that’s there, we won’t know how much we’re actually getting. Okay, foundation aid is up, but there is the GEA deduction, so where do we stand?”

Although state aid to schools increased overall by about $1.3 billion in the current budget, Bob Lowry of the Council of School Superintendents calculates that large urban districts tended to benefit most from increases per pupil in foundation aid, averaging $407, while high need rural districts gained $94 per pupil.

And Lowry has noted that for GEA restoration funds in the current budget, average-need districts gained strongly, with an average of $356 more per pupil, while high-need rural districts gained just $225 per pupil.

Schools In A ‘Tight Box’

“I don’t see any school being in great shape. I don’t see an aid increase this year and the cap will put them in a tight box,” Burns said.

“It would be a challenge for the Legislature to deliver that much aid again.”

The tax cap plan compounds the effects of cuts to school aid that were spurred by the recession beginning in 2008 and by demands from business groups and property owners that taxes were too high to be healthy for business. The formula allows an increase in the annual tax levy of 2 percent or a percentage equal to inflation, whichever is lower, and with inflation so low now, the cap will probably be well below 1 percent – “close to zero percent,” the New York State Council of School Superintendents is warning -- for the next budget cycle.

Taking Away Local Control?

Burns is also concerned that school district voters are being disenfranchised and control of how schools are run is being taken away from local people.

Burns says he’s hearing from school leaders who say the tax cap rules dictate what their tax levies can be, “so why vote on a budget? Villages and towns don’t vote on their budgets.

“Why do we have these school budget votes at all if the state is going to tell us what the tax rate will be?” Burns said.

“It has drastically changed how we do budgets, but none of the referendum rules have changed. If a small district wants to exceed the cap, and holds an election, shouldn’t the majority vote count? If we can’t live within the cap, we need discretion in how we set budgets.

“Under these rules, if a school stays within the cap, we don’t need an election. They’re expensive. If the budget exceeds the cap, we should stay at a majority – 50 percent plus one. Sixty percent seems to violate the constitutional presumption of ‘one man one vote’ when 47 percent decide an election.”

Burns said schools fear that they “cannot offer an acceptable educational program and maintain the cap.”

School districts can present a budget with a levy increase over the prevailing cap, but it can only be adopted if a “super-majority” of 60 percent or more of voters approve.

“Almost all school boards will be in the same situation,” said Burns.

Nearby, Parishville-Hopkinton Central School asked voters to approve a budget that exceeded the cap last spring but was shot down by the super-majority provision twice. In both votes, a majority of school district voters approved the higher levy, but the number of votes, while it was very close, did not amount to 60 percent of them, so it failed.

Burns said he thought Parishville-Hopkinton ended up being punished for being fiscally responsible by paying down debt, which could result in a better position down the road. Parishville-Hopkinton Central saw their over-the-cap budget “as a moral obligation” to the education of their students and the solvency of the district, Burns said.

“It’s fiscally responsible from a budget standpoint to pay off a bus or pay down debt,” Burns said, “but that good fiscal practice works against you in the next fiscal year.”

Governor’s, Business Point of View

The governor’s answer to lower revenues with a state tax cap site is that schools must consider “consolidation” as a way to rein in costs. Much of the information on the state tax cap web pages are devoted to how citizens can attempt to force consolidation or dissolution of school districts and local governments in order to lower taxes for property owners (http://reforminggovernment.ny.gov/reforminggovernment/guide-to-the-property-tax).

The cap plan was not designed to be a panacea for funding schools and village and town governments, but as a way to limit increases in property taxes, effectively limiting the amount revenues could grow.

Is the tax cap succeeding?

For business groups and property owners, who have been complaining loudly about high taxes for decades, the cap seems to be working.

Edmund J. McMahon, president of the tax watchdog group Empire Center for Public Policy, said in the New York Post in June, “the tax cap’s actually working.”

The cap “has had an especially dramatic impact on school taxes, which account for the lion’s share of New York’s exceptionally high property-tax bills,” McMahon said.

But it does not appear to be working for North Country schools, Burns said.

“I think that can be debated -- at 50,000 feet, from a policy perspective or statewide fiscal perspective -- whether the tax cap is working or not,” Burns said. “But it’s not a debate that’s particularly useful for school districts.”